Topic: How To Invest

Spinoffs & Takeovers Hotline – Friday, June 4, 2021

Article Excerpt

LION ELECTRIC CO., $24.67, symbol LEV on Toronto, is a Quebec-based manufacturer of electric medium- and heavy-duty commercial trucks and buses. In April 2021, Northern Genesis Acquisition Corp., a U.S. special purpose acquisition company, or SPAC, announced that it would merge with privately held Lion Electric to complete the qualifying transaction required for this type of acquisition. SPACs are a specialized kind of IPO (Initial Public Offering, or new stock issue). One key difference is that SPACs, also referred to as “blank-check companies,” raise money from investors without providing a detailed business plan. The SPAC goes through an IPO-like process, raising some money and getting listed on an exchange. Its next goal is to find another business to buy, usually within two years. Then the two companies merge, giving the purchased company a relatively quick stock exchange listing and the liquidity that comes with it. On April 23, 2021, Northern Genesis Acquisition Corp. and Lion Electric completed their merger transaction. Lion Electric’s stock…