California-based LiDAR company Quanergy to go public through US $1.4B SPAC deal

Quanergy, a US-based industry-leading provider of LiDAR sensors and 3D perception software, has entered into a definitive business merger agreement with special purpose acquisition fund (SPAC), CITIC Capital Acquisition Corp. (NYSE: CCAC). According to both companies, the close of the deal by the second half of 2021 (subject to customary closing conditions) is expected to bring the valuation of the combined business up to US $1.4 billion.

Purpose of the merger

Quanergy announces that the proceeds from the SPAC deal will be used to accelerate research and development, fund working capital, and pay down debt. Upon closing of the deal, the combined company is expected to be listed on the New York Stock Exchange (NYSE) under the ticker symbol “QNGY”. With the addition of CCAC’s knowledge and resources, Quanergy is expected to be optimally established as a market leader in the LiDAR sector.

Details of the deal

• The deal features an anticipated pro forma net cash of nearly US $278 million to be used to fully fund and accelerate Quanergy’s growth strategy, based on approximately US $276 million in cash currently held in trust (assuming no public shareholders of CCAC exercise their redemption rights at the closing of the transaction).
• The deal also involves the proceeds of a US $40 million fully committed private placement investment in public equity (PIPE) funding.
• Quanergy’s 100% CMOS silicon solid-state OPA technology is a game-changer for the automotive industry, designed for industry-leading performance, reliability, and cost.
• Pro forma implied equity value and enterprise value of the combined business are approximately US $1.4 billion and US $1.1 billion, respectively. 

Trends in the industry

The SPAC, CITIC Capital Acquisition Corp., is backed by CITIC Capital Holdings Limited, an investment firm backed by Chinese conglomerate CITIC Group. Quanergy announced in January 2020 that its co-founder and CEO, Louay Eldada, would be leaving the company. Kevin Kennedy later took charge as interim CEO, then became the permanent head in April. The company states that it has over 40 partnerships and 350 clients globally, across both the internet of things (IoT) and automotive sectors. 

Quanergy is not the first lidar company to go public through a SPAC merger. Others include Volvo-partnered Luminar at a US $3.4 billion valuation and AEye, which will merge with CF Finance Acquisition Corp. III at a US $2 billion deal.

Company Profile

Quanergy Systems is a Silicon Valley-based technology company offering smart sensing solutions. It is a provider of time-of-flight LiDAR sensors and perception software for real-time capture and processing of 3D spatial data and object detection, identification, classification, and tracking. Quanergy’s sensors are disruptive in price, performance, reliability, size, weight, and power while meeting the mass deployment requirement of being a solid-state. 

The company’s solutions are applicable in numerous sectors, including navigation, mining, transportation, 3D HD mapping, robotics, surveying, localization, aeronautics, agriculture, drones, industrial automation, security, smart spaces, and 3D-aware smart devices, delivering improved efficiency, safety, and quality of life.

Founded on November 1, 2012, by Louay Eldada, and Tianyue Yu, Quanergy has its headquarters in Sunnyvale, California, United States.

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