Harley-Davidson Inc. plans to merge LiveWire, its electric motorcycle division, with AEA-Bridges Impact Corp. or ABIC, a special purpose acquisition corporation, in a deal that would make the brand the first publicly traded EV motorcycle company in the U.S.
Harley will still retain 74% ownership of LiveWire and Jochen Zeitz, chairman and chief executive officer of Harley, will be chairman and acting CEO of LiveWire for up to two years following the transaction. Harley will also report the results of LiveWire as a separate segment within its financials while also recognizing amounts attributable to the noncontrolling interests.
The deal is expected to close in the first half of 2022.
“This transaction will give LiveWire the freedom to fund new product development and accelerate its go-to-market model,” Zeitz said. “LiveWire will be able to operate as an agile and innovative public company while benefitting from the at-scale manufacturing and distribution capabilities of its strategic partners, Harley-Davidson and KYMCO.”
KYMCO, a Taiwan-based maker of motorcycles and other powersport vehicles, is making a $100 million private investment in public equity of the new company. Harley will also invest $100 million. The deal will also be financed by $400 million of cash held in trust by ABIC. The SPAC is sponsored by executives from New York-based AEA Investors and Connecticut-based Bridges Fund Management, both private equity firms.
The deal will value the publicly traded LiveWire at more than $1.76 billion and will leave $545 million in cash on the company’s balance sheet.
“We are at the confluence of two seminal shifts impacting the industry – vehicle electrification and sustainability,” said John Garcia, chairman and co-CEO of AEA-Bridges Impact Corp. “LiveWire is well-positioned to become the premier sustainable electric motorcycle brand and redefine the industry by leveraging the manufacturing and distribution expertise of Harley-Davidson and KYMCO. We’re excited to partner with Harley-Davidson and the LiveWire team to help define the future of electric motorcycles as the industry continues its rapid transformation.”
