Canadian electric vehicle maker Lion Electric Co. plans a $50 million stock offering to strengthen its balance sheet and expand factories.
The Montreal company said the expansion will focus on factories in Joliet, Ill., and Mirabel, Quebec. Lion Electric manufactures electric buses and medium-size urban cargo trucks.
Lion Electric said in a Securities and Exchange filing that it expects to net roughly $47 million from the offering after U.S. and Canadian underwriters B. Riley Securities and National Bank Financial take their fee of $3.25 million. The underwriters are floating 19.7 million shares for $2.54 each.
If the offering on the New York and Toronto Stock Exchanges sells out, both companies will have the option to buy an additional 2.9 million shares at $2.54. Lion Electric shares were trading at just over $2 at midday on the NYSE on Wednesday.
The largest investor in Lion Electric is financial services conglomerate Power Corporation of Canada, which holds roughly 35 percent of the company’s shares. The second largest shareholder is company founder and CEO Marc Bedard, who owns 14 percent of the EV maker’s stock.
Lion Electric opened a $185 million battery manufacturing plant in Mirabel a year ago. The province of Quebec and the Canadian government invested $100 million in the plant’s construction.
In May 2021, Lion Electric chose Joliet over sites in Michigan and Texas to build a facility to make up to 20,000 electric buses and trucks a year.
The company said it would spend $70 million over three years and bring over 800 jobs to Illinois, in exchange for $7.9 million in Illinois state tax credits if it meets that goal.
Lion Electric said in November that its Joliet factory has a backlog of 2,408 vehicles, valued at $575 million, that has yet to be delivered. That same month, the Caisse de Depot et Placement du Québec, Canada’s second-largest pension fund, and Montreal’s Finalta Capital also extended a $22.5 million line of credit to Lion Electric.
Founded in 2011, Lion Electric has raised $222.4 million over four funding rounds since its May 2021 initial public offering at $10 per share.
Lion Electric’s customers include Amazon, Ikea, and New Jersey’s school bus services contractors Student Transportation of America and First Student. The latter is owned by Sweden’s EQT Partners, a real estate and infrastructure investment fund.
Lion Electric’s market capitalization stands at $539.78 million, down 74 percent from a year ago, according to data compiled by PitchBook.
In the third quarter of 2022, Lion Electric lost $17.2 million, citing $29 million in capital investment on its manufacturing facilities, including $17 million spent on the Joliet plant.