Troubled electrical automotive maker ElectraMeccanica Automobiles Corp. and U.Okay.-based Tevva Motors Ltd. have agreed to a merger that may give the British business truck start-up a North American foothold, whereas offering ElectraMeccanica a brand new route after the corporate deserted its three-wheeled Solo EV this April.

The all-stock deal introduced Aug. 15 will grant Tevva shareholders a 76.5 per cent stake within the mixed firm, whereas shareholders in Vancouver-based ElectraMeccanica will maintain the remaining 23.5 per cent curiosity. The merged entity will retain the Tevva title and deal with the Tilbury, U.Okay.-based firm’s lineup of medium- and heavy-duty electrical business vehicles.

ElectraMeccanica CEO Susan Docherty stated the “complementary” European and North American operations of the 2 companies will place the mixed firm for development.

“That is the suitable time and Tevva is the suitable associate with which to pivot from shopper autos to business autos,” she stated in a launch.

Docherty, who joined ElectraMeccanica in December 2022, is anticipated to go the mixed entity as CEO following the merger.

A former Common Motors govt, Docherty has overseen main modifications at ElectraMeccanica in her quick tenure, culminating within the abandonment of the corporate’s three-wheeled, commuter-oriented EV earlier this yr. The corporate has additionally been exploring strategic alternate options because it redirected its engineering efforts towards conventional four-wheeled autos.

ElectraMeccanica was based in Vancouver in 2015. Although it formally stays headquartered on Canada’s West Coast, it has consolidated most employees in Mesa, Arizona, the place it owns a 235,000-square-foot (22,000-square-metre) manufacturing plant.

FUTURE IN CANADA IS MURKY

Particulars concerning the firm’s future in Canada post-merger weren’t instantly obtainable.

However ElectraMeccanica’s plant in Mesa will probably be among the many mixed firm’s key property.

Tevva stated the location will complement the corporate’s present 110,000-square-foot (10,000-square-metre) truck manufacturing plant within the U.Okay., which started manufacturing in January. The corporate didn’t instantly share a timeline for when the Mesa plant might start producing Tevva vehicles, however stated the location will enable it “to scale its manufacturing to serve the U.Okay., European and U.S. markets.”

David Roberts, a member of Tevva’s present board, is ready to develop into govt chairman of the mixed firm.

The boards of each ElectraMeccanica and Tevva unanimously authorised the merger deal, which is able to go away the mixed entity with between US $70 and $80 million in money, and debt of about $26 million.

The ensuing firm is anticipated to function as Tevva Inc. and be legally headquartered in Delaware. It’s going to additionally assume ElectraMeccanica’s NASDAQ itemizing beneath a brand new ticker: TVVA.

The proposed deal is anticipated to shut within the fourth quarter of 2023, although it nonetheless requires a number of regulatory and investor approvals, together with the signoff of each ElectraMeccanica and Tevva shareholders.

ElectraMeccanica stated it plans to carry a vote on the proposed settlement within the third quarter.