Benzinga | Nov 12, 2020 01:53AM EST

EV Battery Maker Microvast In Advanced Talks With Tuscan To Go Public Via SPAC Merger: Report

Texas-headquartered electric battery maker Microvast Inc's merger talks with the blank check company Tuscan Holdings Corp (NASDAQ:THCB) has progressed to advanced levels, Bloomberg reports.

What Happened The Special Purpose Acquisition Company (SPAC) will fund the merger by raising $200 million from new equity issues, Bloomberg's sources suggested. Reportedly, the merger would create a new entity with a total valuation exceeding $2 billion.

Since its inception in 2006, Microvast has raised $450 million from two funding rounds. Chinese investment bank CITIC Securities Co. Ltd (OTC: CIIHF) is the lead investor. Microvast's recent investors include the National Venture Capital Association (NVCA) and Chinese alternative asset management firm CDH Investments, as per Crunchbase.

Tuscan disclosed in a filing with the U.S. Securities and Exchange Commission in March 2019 that the initial focus was to spot acquisition targets from the Cannabis industry. However, it was also open to considering potential targets from other sectors and geographies.

Why Does It Matter The battery maker tops the leaderboard in designing and manufacturing batteries for electric buses, with a long shelf life and ultra-fast charging capabilities, according to Electrek. Microvast batteries are used in electric buses in Shangai and Auckland, including the winter Olympic games of 2018 in South Korea, Bloomberg noted.

The battery maker completed building a production facility in Ludwigsfelde, Germany in July, Inas reported by Electrive. Operations in this facility are expected to commence in March 2021.

Ludwigsfelde is close to Brandenburg -- a state that is attracting electric carmakers and battery producers alike. Tesla Inc's (NASDAQ:TSLA) is building a technologically advanced and high-volume production unit. Whereas, the German multinational company BASF SE (OTC:BASFY) is also setting up a production site to make battery materials, as per Reuters.

Price Action On Wednesday, Tuscan shares closed marginally higher at $10.18.