Analysis: Lilium to lifts up on $3.3bn reverse merger

Germany-headquartered aircraft developer Lilium, which counts internet group Tencent among its backers, agreed to a reverse takeover with special purpose acquisition company (SPAC) Qell Acquisition Corporation. The transaction would value the merged company at $3.3 billion pro forma. It will take the spot on the Nasdaq Capital Market acquired by Qell in a $330m initial public offering in October 2020. According to Forbes, the company startup will raise nearly $830m with the transaction, including a total of $380m from the SPAC as well as an additional $450 million in private investments in public equity. For the latter, Tencent, data analytics service provider Palantir and Spain-based construction firm Ferrovial joined forces with Baillie Gifford, LGT and its Lightrock subsidiary, Atomico, FII Institute, funds and accounts managed by BlackRock and private funds affiliated with Pimco to supply $450m in financing.

Launched in 2015 a spinout of Technical University of Munich’s commercialisation arm, Unternehmertum, Lilium develops five and seven-seater electric vertical take-off and landing jets which are being developed for use as urban airborne taxi and logistics service. The proceeds from the reverse merger will support the completion of Lilium’s German manufacturing facilities, the launch of production jets and certification activities for the technology. A commercial launch of Lilium´s jet is expected to take place in 2024.

The company is part of the broader drones and robotics space, which has been given much attention by corporate investors over the past decade, as the GCV Analytics  chart below shows. The number of corporate-backed deals in that space reached an all-time high at 55 last year, while total estimated capital in those rounds amounted to $1.43bn.