Eve Air Mobility has entered into a definitive business combination agreement with Zanite Acquisition Corp, which will see the new company listed on the New York Stock Exchange under the ticker symbols ‘EVEX’ and ‘EVEXW’.
The deal, which is expected to close in Q2 2022, values Eve at an implied $2.4 billion and will give the company approximately $512 million in cash, resulting in a total pro forma equity value of about $2.9 billion. Cash proceeds are expected to be used to fund operations, support growth and for general corporate purposes.
This will be funded through a combination of Zanite’s approximately $237 million cash in trust and a $305 million PIPE of common stock at $10 per share, comprised of commitments of $175 million from Embraer, $25 million from Zanite’s sponsor and $105 million from a consortium of leading financial and strategic investors.
These include Azorra Aviation, BAE Systems, Banco Bradesco, Falko Regional Aircraft, Republic Airways, Rolls-Royce and SkyWest.
Eve will be led by co-CEOs Jerry DeMuro, who most recently served as CEO of BAE Systems, Inc., and Andre Stein, who has led Eve since its inception and served in leadership roles with Embraer for more than two decades.
Stein said: “Eve was founded on a vision to accelerate the UAM ecosystem, make safe and affordable urban air transportation available to all citizens, while reducing global carbon emissions. The transaction announced today with Zanite is a major milestone that will accelerate our strategic plan and support us in realising our vision.”
DeMuro added: “Urban air mobility is a transformational opportunity in the aviation sector. I joined Eve because I believe that there is no company better positioned to capitalise on the tremendous potential of this emerging market.”
Eve is the first company to graduate from EmbraerX, the market accelerator created in 2017 by Embraer, a global leader in the aviation industry with a more than 50-year history of aircraft manufacturing and certification expertise.
It has introduced a comprehensive, practical and capital efficient UAM solution spanning eVTOL vehicle design and production, service and support, fleet operations and urban air traffic management.
Additionally, Eve has formed a powerful network of dozens of highly respected strategic partners spanning the UAM ecosystem, including fleet operators, ride sharing partners, vertiport providers, aircraft lessors, financing partners, renewable energy providers and leaders in the defense and technology sectors.
From this partner network, Eve has secured launch orders from 17 customers, via non-binding letters of intent, resulting in a pipeline of 1,735 eVTOL vehicles valued at approximately $5 billion.
This SPAC deal will also see Embraer remain as a majority stakeholder with an approximately 80 per cent stake in Eve Holding following the closing of the transaction and includes its investment in the PIPE.
Francisco Gomes Neto, president and CEO of Embraer, said: “We believe that the urban air mobility market has enormous potential to expand in the coming years based on an efficient, zero-emissions transport proposition, and that with this business combination, Eve is very well positioned to become one of the major players in this segment.
“As a global aerospace company, with leadership position in multiple segments, we understand that innovation and technology play a strategic role in driving sustainable growth and redefining the future of aviation.”
Zanite is a special purpose acquisition company and was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganisation or similar business combination with one or more businesses in the aviation, aerospace and defense, urban mobility and emerging technology industries.
Zanite’s sponsor is managed by Kenneth C. Ricci, Principal of Directional Aviation Capital, and Steven H. Rosen, Co-Founder and Co-Chief Executive Officer of Resilience Capital Partners along with its Board of Directors and Strategic Advisors Larry Flynn, Dr. Ron Sugar, Patrick Shanahan and John Veihmeyer.
Zanite began trading on Nasdaq in November 2020 and its common stock, units and warrants trade under the ticker symbols ‘ZNTE’, ‘ZNTEU’ and ‘ZNTEW’, respectively.
Ricci, who is also Co-CEO of Zanite, added: “The Zanite team is extremely proud to partner with Eve and Embraer in this transaction. After an extensive search, we selected Eve because of its simple and certifiable eVTOL design, its capital efficient approach to fleet operations and Embraer’s global footprint that we believe will enable Eve to not only reach vehicle type certification, but to scale its manufacturing, support and operations globally.”
Zanite, Embraer and Eve will host a joint investor webcast and conference call to discuss the proposed business combination at 8am EST today (Tuesday). The live call and replay will also be available as a webcast, which can be accessed at Zanite’s investor site here.