Israeli commercial fleet vehicle electrification company REE Automotive. (Nasdaq: REE) saw its share price jump 44% yesterday on Wall Street, after announcing a global manufacturing agreement with Indian engineering company and manufacturing specialist for the auto industry Motherson.
The agreement includes a strategic investment in REE's $45.35 million share offering. M&G Investments, REE’s long-term supportive shareholder, led the investment with $20 million followed by Motherson participating with a $15 million investment. Following the closing of the offering, M&G will hold 16% of REE’s issued and outstanding ordinary shares and Motherson will hold 19%.
REE aims to increase production to meet growing demand and anticipated fleet orders from significant multi-national customers. REE offers a software-driven medium duty electric truck that can meet an expected fleet transition to electric of more than 240,000 medium duty trucks in the US alone and more than double across the rest of the world. By collaborating with Motherson, REE can focus on further growing its customer base, generating orders, increasing gross and cash flow margins, and expanding its patent portfolio.
REE cofounder and CEO, Daniel Barel, said, "We are very excited to enter into this agreement with Motherson, as I believe this agreement will enable us to leapfrog over many of the challenges others face when ramping up production. Motherson’s global footprint and manufacturing prowess combines perfectly with REE’s technology and innovation mindset. This combination will benefit our customers and investors alike, by pushing forward the transition towards electrification and carbon neutrality. We are proud to join forces with Motherson and looking forward to learning from their incredible story and amazing culture."
Following the jump in share price, REE has a market cap of $47 million, still a tiny fraction of the $3.1 billion pre-money valuation with which it completed a SPAC merger in July 2021 and was listed on Nasdaq.
Published by Globes, Israel business news - en.globes.co.il - on September 17, 2024.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2024.