Harley-Davidson’s LiveWire Going Public via SPAC Deal

Deal Values LiveWire at $1.77 billion

LiveWire, the electric motorcycle unit of Harley-Davidson (HOG), is going public via a SPAC deal. The transaction values the unit at $1.77 billion. The 100-plus year old motorcycle company rolled out LiveWire earlier in 2021 hoping to reinvigorate a legacy brand that has seen its market share decline in recent years. An electric motorcycle was initially seen as a way to drive new interest and ultimately demand.

Under the terms of the deal, LiveWire will merge with special purpose acquisition company AEA-Bridges Impact (IMPX) and will trade under the symbol “LVW”. Harley-Davison will keep a 74% stake in the standalone public company.

LiveWire Expects to Raise $545 Million

LiveWire expects to raise around $545 million from the deal. Proceeds will go to develop products and boost its manufacturing and distribution capabilities. By spinning out the unit, Harley-Davidson thinks it will be more agile, operating like a startup rather than a company that has been around for over 100 years.

The electric motorcycle company is targeting new riders living in urban areas. The company plans to open up showrooms in cities like Los Angeles, with more slated to open in the early part of 2022. LiveWire’s One electric motorcycle goes about 146 miles on a single charge and costs a little under $20,000 when tax incentives are factored in.

Green Vehicles All the Rage

LiveWire is the latest green focused company to tap the public markets. Investors have been clamoring to get in on green deals as climate change awareness grows around the globe. Electric-truck maker Rivian (RIVN) went public last month with a $100 billion valuation. That is more than both GM (GM) and Ford (F).

Investors reacted favorably to Harley-Davidson’s move, sending shares higher yesterday. Wall Street is now paying close attention to other companies who might follow in Harley’s footsteps. After all, Harley-Davidson isn’t the only original equipment manufacturer with an electric-vehicle unit. Fund managers are betting similar companies may want to orchestrate a spin off via a SPAC deal or some other transaction if Harley-Davidson is successful.

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