QuantumScape, a US-based solid-state battery developer backed by automotive manufacturer Volkswagen, agreed to a reverse merger with special purpose acquisition company Kensington Capital Acquisition Corp yesterday.
The deal will involve the merged business, which is expected to be valued at $3.3bn, taking Kensington’s listing on the New York Stock Exchange.
The company will also receive $500m through a private investment in public equity (PIPE) deal anchored by investment and financial services group Fidelity Management and Research and Janus Henderson Investors.
Founded in 2010, QuantumScape is developing solid-state lithium-metal batteries for electric vehicles that are designed to create an electric circuit by moving a charge from the positive terminal – the cathode – to the negative end – the anode – through the electrolyte.
Solid-state batteries utilise a solid material for the electrolyte instead of the liquid or gel typically used in lithium-ion batteries. They potentially offer higher energy density and added safety but have faced a range of challenges in their path to the market including cost and durability.
QuantumScape will use the proceeds from the reverse merger to drive continued product development and validation through to the production launch of its batteries for use in cars made by Volkswagen.
The proceeds from the merger, PIPE investment and series F funding from Volkswagen and sovereign wealth fund Qatar Investment Authority will cumulatively top $1bn according to the company, Volkswagen having committed in June this year to invest up to $200m.
Volkswagen and QuantumScape had formed a joint venture to mass produce the company’s batteries, and their initial collaboration dates back to 2012. The carmarker made a $100m investment in QuantumScape in mid-2018.
The company has not disclosed details about its earlier funding but its website lists automotive parts manufacturer Continental, carmaker SAIC Motor, Stanford University, Khosla Ventures, Kleiner Perkins, Lightspeed Venture Partners, Capricorn Investment Group, Breakthrough Energy Ventures and Bill Gates as investors.
The original version of this article appeared on our sister site, Global University Venturing.
