EVgo Services, the largest electric vehicle public fast-charging network in the U.S. and a wholly owned subsidiary of LS Power, will become a publicly listed company following a recently announced agreement with Climate Change Crisis Real Impact I Acquisition Corporation (CRIS).
EVgo meets CRIS’s investment criteria, which focus on investments in disruptive energy infrastructure opportunities that are aligned with environmental, social and governance principles.
Upon closing of the transaction, the combined company will be named EVgo Inc. and publicly listed under the symbol “EVGO.”
The pro forma implied market capitalization of the combined company is US$2.6 billion at the US$10 per share PIPE subscription price, assuming no CRIS shareholders exercise their redemption rights. Net cash proceeds are estimated to be approximately US$575 million, comprised of US$400 million from the PIPE and approximately US$230 million of cash held in trust by CRIS before any adjustments due to redemptions by CRIS shareholders and payment of deferred underwriting compensation, less transaction expenses.
Proceeds will be used to fuel EVgo’s growth strategy, including the buildout of its charging infrastructure network, and will enhance the company’s position as the market leader in the transition to clean mobility. LS Power and EVgo management, who together own 100% of EVgo now, will be rolling 100% of their equity into the new company and is estimated to represent approximately 74% of the company upon transaction close.
EVgo’s leadership will remain intact, with Cathy Zoi continuing as CEO of the combined company, overseeing its strategic growth initiatives and expansion. Zoi will work alongside other existing executive team members, including Olga Shevorenkova, chief financial officer, Ivo Steklac, chief operating and chief technology officer, and Jonathan Levy, chief commercial officer.
The board of directors of the combined company will include representation from EVgo, LS Power and CRIS, as well as independent directors. David Nanus of LS Power will serve as chairman and will be joined by Zoi of EVgo and Beth Comstock, chief commercial officer of CRIS; other board appointments will be made prior to closing.
The transaction has been approved by the EVgo board of directors and the CRIS board of directors. Completion of the proposed transaction is subject to customary closing conditions, including the approval of the stockholders of CRIS, and is expected to occur in the second quarter of 2021.
“Just a few years ago, electric vehicles were considered niche,” said Zoi. “Today, improved technology, lower costs, greater selection and a better appreciation for the performance of EVs is increasingly making them the vehicle technology of choice. With that, the need for fast charging is on the rise. An estimated 30% of Americans do not have access to at-home charging, and EVs will be increasingly deployed by fleets to transport goods and people in an environmentally friendly way. Time is precious for all of us, so a public fast-charging option with an expanding footprint like EVgo is essential to meet the rapidly growing needs of EV drivers of all types.”
“EVgo is a crown jewel in our portfolio and is one of the LS Power businesses leading the charge toward decarbonization,” commented Nanus, LS Power’s Co-Head of Private Equity and EVgo Chairman. “EVgo’s extensive nationwide network and deep relationships with its customers and other stakeholders create a real competitive advantage for the company, and this business combination, which will both fully fund and accelerate the company’s growth plans, positions EVgo to further strengthen its market-leading position.”
"Starting from our IPO in September, we set out looking for a purpose-driven company making a meaningful contribution in the fight against climate change that was best in class in its sector. We are excited to have found that company in EVgo," said David Crane, CEO of CRIS. “We spent a substantial amount of time conducting extensive due diligence on EVgo, affirming our belief of its enduring first-mover advantage. It has a distinct and highly advantageous owner-operator business model, supported by strategic partnerships with key industry players singularly focused on an essential and growing factor necessary for supporting widespread EV adoption. EVgo’s comprehensive national DC fast-charging network capable of charging every type of electric vehicle is unparalleled, and we are proud to be a part of its ongoing success.”
Founded in 2010, EVgo is a leader in the transportation electrification space. Through its partnerships with automakers, fleet and rideshare operators, retail and other site hosts, utilities, governments and other stakeholders, EVgo has expanded over the last decade to become the largest platform for EV public fast charging in the U.S. EVgo's network, spread over more than 800 locations in 67 major metropolitan markets across 34 states, is powered 100% by renewable electricity and caters to 220,000 customers.
The company has benefited from strong partnerships with automotive OEMs, site host partners, rideshare providers and other stakeholders in the e-mobility landscape. These include a strategic relationship with General Motors, which selected EVgo for a nationwide EV charging infrastructure buildout, whereby EVgo expects to add more than 2,700 additional fast chargers to its network over the next five years. Corporate partners also include Uber and Lyft, which selected EVgo as one of their first charging providers. EVgo has also worked with Tesla, to enable native fast charging on EVgo’s network. Additionally, EVgo partners with governments and utilities across the U.S..
EVgo also has developed a dedicated suite of software-enabled products and services, such as charging reservation capability, smart access to host sites, integrated retail promotions and loyalty programs.
EVgo’s business model is underpinned by over US$300 billion in industry-wide automaker and battery manufacturer commitments to electric vehicle programs, trends towards mobility as a service and industry expectations for the EV market to increase over 100x between 2019 and 2040. Market growth is expected to be driven by both commercial and consumer market segments.
