Evolv Technology to Go Public in $1.7B Merger With Investment Firm
Crowd-safety company Evolv is backed by investors including Microsoft Co-Founder Bill Gates and former Florida Governor Jeb Bush.
WALTHAM, Mass. — Evolv Technology, a leading provider in artificial intelligence (AI)-based touchless security screening, and special-purpose acquisition company (SPAC) NewHold Investment Corp. (Nasdaq: NHIC) have entered into a definitive merger agreement that will result in Evolv becoming a publicly traded company.
It is anticipated that Evolv will trade on the Nasdaq with the ticker symbol “EVLV” after the transaction’s expected close in the second quarter, according to an announcement.
SPACs are shell companies that raise funds to acquire a private company with the purpose of taking it public, allowing such targets to sidestep a traditional initial public offering to enter public markets.
The agreement calls for Evolv to merge with a wholly owned subsidiary of NewHold, with Evolv being the surviving entity of the merger and a wholly owned subsidiary of NewHold. NewHold, which currently holds approximately $172.5 million of cash in trust, will be renamed to Evolv Technology Inc. following the merger.
The combined entity will have an estimated pro forma enterprise value of approximately $1.25 billion and total equity value of approximately $1.7 billion.
The upsized and oversubscribed $300 million PIPE includes investors such as Motorola Solutions, Magnetar Capital, Eldridge, Senator Investment Group and UBS O’Connor. Investors in the PIPE include former NFL quarterback Peyton Manning and tennis stars Andre Agassi and Steffi Graf.
The transaction has been unanimously approved by the board of directors of both NewHold and Evolv and is subject to customary closing conditions, including the approval of NewHold’s stockholders.
Assuming no trust account redemptions by NewHold’s public stockholders, Evolv’s existing stockholders will own approximately 72% of the fully diluted shares of common stock of the combined company upon the transaction closing.
The combined company expects to receive approximately $470 million in gross proceeds from the trust account and PIPE investors, assuming no redemptions by NewHold’s existing public shareholders.
The cash proceeds are expected to be used to extend Evolv’s product portfolio, operating expenses incurred as a result of customer demand, and working capital to support increasing production demand. In addition, proceeds will be used to expand the company’s penetration of the physical security market and build new markets with its touchless security-as-a-service (SaaS) technology.
Following the closing of the transaction, the company will be led by CEO Peter George. Kevin Charlton, CEO of NewHold and Neil Glat, board member of NewHold, will join Evolv’s board of directors alongside Evolv CEO Peter George, Evolv Co-Founder Mike Ellenbogen, Chairman Alan Cohen of DCVC, David Orfao of General Catalyst, Bilal Zuberi of Lux Capital, an executive from Motorola Solutions, Merline Saintil and Mark Sullivan.
Evolv’s investors include Bill Gates; former Florida Governor Jeb Bush’s firm, Finback Investment Partners; DCVC; General Catalyst Partners; Lux Capital; SineWave Ventures; Motorola Solutions and Stanley Ventures. The company’s partners include Motorola Solutions, Stanley Security and Johnson Controls.
Evolv is the first company in the industry to introduce a subscription SaaS model with its customers, including, Uber, Lincoln Center, L.L. Bean and Six Flags Entertainment Corp., according to the announcement.
“Evolv Technology presents a preeminent opportunity to build the world’s most important enterprise in physical security, expanding the boundaries through AI and analytics,” states Charlton. “This transaction will provide Peter and the Evolv team with the capital to continue to develop the leading technologies that will make people safer and make their lives more convenient.”
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