- The valuation of Archer Aviation, an electric air taxi startup, was cut by $US1 ($AU1) billion by the SPAC taking it public.
- Archer’s new $US1 ($AU1).7 billion valuation creates a more attractive entry point, said the company and SPAC sponsor Atlas Crest.
- The former CEO of United Airlines, Oscar Munoz, is joining Archer’s board.
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Archer Aviation, an electric air taxi startup, is preparing to be taken public with its valuation cut by $US1 ($AU1) billion in a revised deal between the company and Atlas Crest, its blank-check sponsor.
Archer’s pro forma enterprise value now stands at $US1 ($AU1).7 billion, down from $US2.7 ($AU4) billion, according to a joint statement Thursday. The companies said the change establishes a more attractive entry point and recognizes Archer’s commitment to driving long-term value creation for its shareholders.
Archer and Atlas Crest first announced their merger agreement in February, with a pro forma equity value of $US3.8 ($AU5) billion. The combined company is still in line to receive $US1 ($AU1).1 billion in proceeds under the amended deal.
San Francisco Bay Area-based Archer makes aircraft that feature vertical take-off and landing. The company in February received a $US1 ($AU1) billion order from United Airlines, with an option for an additional $US500 ($AU681) million of aircraft. Oscar Munoz, the former CEO of United Airlines, will join Archer’s board, according to Thursday’s statement.
“Archer’s commercial partnerships and unparalleled talent set us apart from any other company in the eVTOL space,” said Adam Goldstein, Archer’s co-founder and co-CEO, referring to the electric vertical takeoff and landing concept. “We believe these qualities and our meaningful recent business progress, combined with an adjusted valuation, support a highly compelling investment thesis on an absolute and relative basis.”
The revision comes at a time of heightened regulatory scrutiny of blank-check companies, or SPACs. Special purpose acquisition companies allow private companies to bypass the slower and costlier traditional IPO process for going public. The Securities and Exchange Commission earlier this year issued a warning to SPACs about presenting projections that only give an optimistic view of future growth, and said it would carefully review SPAC filings and disclosures and those of their private deal targets.
Archer will be listed on the New York Stock Exchange with the ticker “ACHR.”