LONDON -- British electric van startup Arrival, which is backed by Hyundai and BlackRock, has agreed to merge with CIIG Merger Corp. to get a U.S. listing at a market valuation of about $5.4 billion, it said Wednesday.
CIIG is a special purpose acquisition company -- a business that raises money on the stock market to buy an operating company.
SPACs have been behind some of the most high-profile recent public listings, including electric vehicle startup Nikola Corp. and electric carmaker Fisker Inc., as investors place bets on which startup will be the next Tesla Inc.
Arrival should receive roughly $660 million from the deal, due to be completed in the first quarter of 2021. This will include the $260 million CIIG raised in its IPO last year, and another $400 million raised from institutional investors, including BlackRock.
BlackRock is CIIG's largest shareholder with a 7.5 percent stake, according to Refinitiv Eikon data.
Arrival, which is developing electric delivery vans and buses, will trade on Nasdaq under the ticker symbol "ARVL" and use the funds to expand production capacity.
Its shareholders, including delivery firm UPS and Hyundai Motor Co., have approved the deal.
Arrival raised $118 million from BlackRock last month.
After the deal, CIIC will own around 12 percent of Arrival stock, with other investors including UPS and Hyundai owning about 88 percent.
Arrival, which is also developing self-driving technologies, has an order for 10,000 electric delivery vans from UPS, with an option for another 10,000.
Avinash Rugoobur, president of Arrival, said those UPS vans would be "depot autonomous" -- meaning they will be able to self drive, for instance, from their charging stations to be cleaned.
As autonomous driving technology advances, Arrival can then upgrade the vans UPS has under order.
"UPS can buy a vehicle today and we call it 'autonomous ready' because we can upgrade that existing asset to be autonomous," Rugoobur said.
Arrival is a potential rival to U.S. startup Rivian, backed by Ford Motor Co. and Amazon, among others, which is building 100,000 electric delivery vans for Amazon.
Tighter emissions regulations in Europe, China and California should boost demand for commercial electric vehicles. Research firm IDTechEx forecasts annual global commercial electric vehicle sales will hit around 2 million units by 2030, and 7.3 million by 2041.