Ready to take a quick trip in the skies? Thanks to some new merger news, you may be able to soon. Investors learned this morning that Atlas Crest (NYSE:ACIC) plans to take Archer public, helping launch its electric aircraft dreams. So with ACIC stock rallying, what do you need to know about the Archer SPAC merger now?
To start, Atlas Crest Investment is a special purpose acquisition company that will bring a private business public through a reverse merger. Archer is an electric aircraft startup. More specifically, it wants to make air transportation more sustainable.
With that in mind, here is what you need to know about ACIC stock and the Archer SPAC merger:
- Atlas Crest Investment first came public in October 2020.
- At the time, it raised $500 million by offering 50 million units at $10 each.
- Investors should note that Ken Moelis, the founder of Moelis & Company, chairs the SPAC.
- Today, ACIC stock is rallying on news the blank-check company would acquire Archer.
- Archer is an electric aviation startup working to make an electric vertical takeoff and landing (eVTOL) aircraft.
- The company is based in Palo Alto and launched in May 2020.
- It counts United Airlines (NASDAQ:UAL) and Marc Lore, the former CEO of Walmart eCommerce, as its backers.
- It believes this sort of aircraft will fix traffic problems in cities and make transportation more sustainable.
- The company is targeting affordable, safe and quiet vehicles to address travel problems.
- The goal is for its eVTOL to be able to fly for 60 miles at 150 miles per hour.
- Perhaps most importantly, Morgan Stanley estimates that this electric aircraft market will be worth $1.5 trillion by 2040.
- Investors should note that the Archer SPAC merger is a deal worth $3.8 billion.
- Merging with Atlas Crest will result in net proceeds of about $1.1 billion.
ACIC Stock and the Archer SPAC Merger
So what should investors know about ACIC stock and the Archer SPAC merger?
The first thing is that this next generation of aircraft is increasingly popular. In recent weeks, a handful of other blank-check deals stand out. Blade, another urban air mobility player, announced that it would come public via Experience Investment (NASDAQ:EXPC). Joby Aviation, which recently acquired flying taxi assets from Uber (NYSE:UBER), is also in talks to come public. And lastly, private jet play Wheels Up announced it would merger with Aspirational Consumer Lifestyle (NYSE:ASPL). These deals show there is real investor and consumer interest in avoiding traffic and taking to the skies.
The second thing to note is that the Archer SPAC merger stands out. That is because it comes with pretty significant institutional support. Besides backing it in the SPAC deal, United Airlines has placed a $1 billion order for 200 Archer eVTOL aircraft. It also has the option to purchase 100 more for $500 million. According to United CEO Scott Kirby, this backing is a way for United to support clean and efficient transportation. Stellantis (NYSE:STLA) is working to make the carbon-fiber fuselage of the aircraft.
Clearly, big names in the game think Archer is onto something. That is a good sign for investors, and a good reason to keep ACIC stock on your radar.
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 with InvestorPlace.com.