The electric vehicle market is charging up with yet another new entrant. Last week, investors learned that Nuvve, a vehicle-to-grid (V2G) charging company, is coming public through Newborn Acquisition (NASDAQ:NBAC). What exactly does that mean? And what should investors know about the Nuvve SPAC Merger? You can dive in below.
To start, Nuvve considers itself a leader in V2G technology. This means that, like many other recent initial public offerings and SPAC mergers, it participates in the hot electric vehicle niche. However, as we will explore below, Nuvve has a different approach. The California-based company uses a different sort of EV charging technology to power fleets of electric cars around the world.
So, if you want to understand the Nuvve SPAC Merger, you have to understand the potential of V2G. Essentially, there are two types of charging companies. On one hand, you have the likes of Blink Charging (NASDAQ:BLNK) and ChargePoint (NYSE:SBE). These companies support charging infrastructure for EVs, and they tap into electrical utilities to power electric cars. Investors could consider these companies participants in the V1G market. On the other hand, you have Nuvve, which is a V2G player. This means that not only do its chargers power electric vehicles, they allow power from the electric vehicles to flow back into the grid.
Why does this matter? Well, according to Nuvve, its solutions will help make the acceleration of EV adoption more sustainable. As public charging infrastructure develops, and as government incentives like those promised by President-elect Joe Biden take hold, electric cars could put a strain on the grid. One way to minimize that strain is to give back via V2G solutions.
As Nuvve puts it, these solutions are particularly ideal for commercial fleets, like electric school buses, transit vans or municipal EVs.
Nuvve SPAC Merger and Electric Car Stocks
How then should investors approach the Nuvve SPAC merger? Well, the company has primarily found success in European markets, where it has partnerships with different national utilities. However, it just formed a new partnership in California that will allow it to test out its V2G tech in that market.
This means that Nuvve offers investors a chance to watch an up-and-coming part of the EV market unfold. It will also provide investors access to the world of European electric cars as the U.S. angle ramps up.
Importantly, the U.S. angle for Nuvve is not 100% clear. Tesla (NASDAQ:TSLA), which also is building up a public EV charging infrastructure, has flirted with V2G tech in the past. During a recent shareholder event, CEO Elon Musk said that the company backed away from it after realizing consumer interest was not particularly high. Could that change? And will Nuvve be first in line to benefit in the U.S. if it does? One thing working for it is its current dominance in the V2G market.
Regardless, the Nuvve SPAC merger is one to have on your radar. When the reverse merger closes, Nuvve will trade on the Nasdaq Exchange. Investors should also note that the company will come public with an enterprise value just over $130 million.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer for InvestorPlace.com.