ChargePoint, an electric vehicle recharging network, has announced a public listing through a reverse merger with Switchback Energy Acquisition Corp. Switchback, based in Dallas, was created in 2019 specifically for the transaction and raised $300 million in its IPO. ChargePoint, based in Campbell, California, is valued at $2.4 billion with the acquisition. The deal includes a $225 million private investment in public equity placement valued at $10 per share according to a company announcement.

Who is ChargePoint

ChargePoint is the largest electric vehicle charging provider in the world and was previously backed by BMW, Daimler and Siemens as well as Baillie Gifford, a Scottish investment trust company. The company intends to use the funds raised to expand in Europe and North America aiming to ride the increasing uptake of electric vehicles by consumers. In 2019 it lost $133 million on revenue of $147 million as a result of continuing investment, according to the company.

Demand for Electric Car Charging Stations

The potential market for electric vehicles is massive and demand for electric cars have risen across the globe even as demand for traditionally powered cars has fallen. The availability of charging stations will become crucial as uptake increases and the company was established in 2007 to take advantage of this. According to the company, they have built a robust, scalable platform to meet the coming demand for charging stations around the world. The company claims it has installed about 100,000 charging stations across Europe and the US and has captured over 70% of the US market.

ChargePoint Reverse Merger

Some have criticized the merger because of its lack of transparency and the presence of investors who are looking for a quick return and unlikely to stay the course in the long term. However the chief executive, Pasquale Romano, has stated that the company is a legitimate business pointing to the fact that they have been in existence for over a decade, have a well-defined market and potential for growth worldwide as electric vehicle uptake accelerates. He went on to say that the timing for becoming a public entity is right given the increased financing that will be required to roll out their stations and that this was the only consideration when going through with the transaction.