Shares of the so-called blank-check company merging with electric carmaker Fisker fell 20 percent on Friday after it disclosed it would not close a deal by the end of July to use Volkswagen Group's EV platform for its vehicles.
Spartan Energy Acquisition Corp., backed by alternative investment manager Apollo Global Management Inc., announced a deal earlier in July to take Fisker public through a merger that valued the EV startup at $2.9 billion. The deal is expected to close in the fourth quarter.
A blank-check company, or SPAC, is a shell company that raises money through an initial public offering to buy an operating company, typically within two years.
Shares of Spartan fell 10 percent on Friday to close at $12.32, well below the highs of $23.86 when the deal was announced earlier this month. The stock is still above Spartan's IPO price of $10.
Fisker said at the time of the deal it was in talks with VW to use the German automaker's MEB EV platform to speed vehicle development and cut costs, but it disclosed the delay in documents filed on Friday with the U.S. Securities and Exchange Commission.
"We have not achieved our goal of signing a cornerstone agreement with VW by the end of July 2020 as we previously anticipated," Fisker said in the filing. "We look forward to continuing discussions with VW again in September after the traditional European summer holidays."
"We remain in conversation with several other potential (automakers) and suppliers that would be able to fit within our unique business model and we believe will enable us to enter into definitive manufacturing and supply agreements before year-end," the company added.
The Spartan deal will provide Fisker with $1 billion in gross proceeds. Fisker said in the SEC filing that it will use those funds to launch its Ocean SUV by late 2022, followed by a super-sports sedan, a sports crossover and a pickup truck by 2025.
Fisker previously said it was in talks with other companies, including Magna International Inc., about building the SUV.