Harley-Davidson Inc. said on Monday that its LiveWire electric motorcycle business will enter into a deal worth nearly $1.8 billion with a London-based acquisition company.
LiveWire will be listed on the New York Stock Exchange under the symbol LVW. Harley said in a statement that the transaction is expected to be completed in the first half of 2022.
Harley-Davidson will retain approximately 74% of LiveWire. The shareholders of partner AEA-Bridges Impact Corp. will own approximately 17% of the shares.
Jochen Zeitz, Harley's chairman, president and chief executive officer, will serve as the acting chief executive officer of the new company for two years. Ryan Morrissey's title is Harley's chief electric vehicle officer, and he will serve as president of the new company.
"Today's announcement is a historic milestone. LiveWire will become the first publicly traded electric motorcycle company in the United States," Zeitz said in a statement.
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"This transaction will allow LiveWire the freedom to fund new product development and accelerate its listing model," Zeitz said.
AEA-Bridges Impact Corp. is a special purpose acquisition company formed by private equity firms AEA Investors and Bridges Fund Management. Special purpose acquisition companies (SPAC) are used as a shortcut to going public, bypassing the long and expensive process of traditional initial public offerings.
One of the focuses of AEA-Bridges Impact Corp. is environmental sustainability projects. Another partner in the Livewire transaction is KYMCO, a Taiwanese manufacturer of motorcycles, scooters and utility vehicles.
"We are at the confluence of two groundbreaking shifts affecting the industry-automotive electrification and sustainability. LiveWire has the ability to become the premier sustainable electric motorcycle brand and by leveraging the manufacturing and distribution expertise of Harley-Davidson and KYMCO Redefining the industry," John Garcia, chairman of AEA-Bridges Impact Corp., said in a statement.
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LiveWire is the first electric motorcycle launched by Harley in 2019, aimed at attracting young customers. Fast and powerful street cars do not require clutches or gear changes, simplifying operations for novices. Bicycles can get energy from the brakes and charge the battery, which is useful in stop-and-go traffic.
The newly formed company will also include STACYC, a children's electric bicycle brand.
The transaction has been approved by the boards of Harley-Davidson and AEA-Bridges Impact Corp., with funding from AEA US$400 million, Harley-Davidson US$100 million and KYMCO US$100 million.
After the announcement on Monday, Harley’s share price rose and closed at $38.54 that day, up 4.7%