XL Fleet Is Going Public Through SPAC

XL Fleet is going public, but not through the traditional IPO process. Instead, XL Fleet has chosen to take its stock public through a special purpose acquisition company (SPAC) called Pivotal Investment Corp. XL Fleet will follow in the footsteps of SPAC-sponsored companies like Nikola, DraftKings, and Virgin Galactic Holdings.

XL Fleet is focused on commercial electric trucks. The company doesn’t build its own brand of trucks. Instead, XL Fleet has developed a technology that transforms gas-powered trucks into electric vehicles. The company's electrification system can be fitted into commercial trucks from manufacturers like General Motors, Ford Motor, and Isuzu. 

XL Fleet is sitting on 12-month orders worth $220 million. The company generated $7.2 million revenue in 2019 and aims to generate $21 million in 2020 and $75 million in 2021. The addressable market for XL Fleet is about $1.0 trillion.

XL Fleet said that its technology helps customers cut costs and reduce emissions without impacting operations. The company has more than 200 customers including FedEx, Coca-Cola, PepsiCo, Verizon, Harvard University, and Yale University. The company is located in Boston.

Pivotal Investment is a SPAC sponsored by Jon Ledecky of Ironbound Partners and Kevin Griffin of MGG Investment Group. Also called blank check companies, SPACs like Pivotal Investment exist strictly to raise money through an IPO with the proceeds being used for acquisitions. Currently, Pivotal Investment doesn't have any commercial operations. The company will have commercial operations after it combines with electric vehicles startup XL Fleet. 

The XL Fleet-Pivotal Investment SPAC merger wants to capitalize on the demand for electric vehicles. EV stocks Tesla and NIO have soared in 2020. Many newly public electric vehicle companies are well above their IPO price, which indicates strong investor interest in EV stocks.

Investors who want to own a piece of XL Fleet stock may want to know when the company is going public. XL Fleet expects to complete the SPAC IPO merger deal with Pivotal Investment in the fourth quarter of 2020. However, closing the transaction will depend on several factors including existing Pivotal Investment and XL Fleet investors approving the deal.  

XL Fleet stock will trade on the NYSE under the ticker symbol “XL.” Pivotal Investment stock also trades on the NYSE. Going public through a SPAC guarantees that XL Fleet funds will go toward growing the business.

Pivotal Investment stock rose 1.59 percent to $11.50 during after-hours trading on Sept. 24. The stock recouped some of its losses earlier in the day. The stock fell 9.58 percent during the regular session on Sept. 24 and closed at $11.32. 

Since Pivotal Investment stock is publicly traded, you can buy it through your regular broker. Open a stock trading account with a broker of your choice and fund the account. Search for Pivotal Investment stock on the broker’s app, decide the number of shares you want to purchase, and place your order. Pivotal Investment stock will convert to XL Fleet stock after the merger transaction closes by the end of 2020. 

You will be able to buy XL Fleet-Pivotal Investment SPAC IPO merger stock on Robinhood. Online brokers like Robinhood, SoFi Invest, and Cash App Investing also allow investors to buy fractional shares for as little as $1.0.