Well they also say CIIG sponsor shareholders will get 1% of Arrival. Also the deal price was quoted at $5.392billion at a CIIG share price of $10. So if CIIC doubles to $20 a share the implied valuation is not $5.392billion x 2?
I think we need someone more experienced to explain how this works. The video makes it sound like CIIC will get 4% regardless of its market cap but Reuters claims it will get 12%.
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Slide 41 of the investor presentation explains things. The sponsor(the people who put the SPAC together) gets 1%, people who own CIIC shares get 4%, the PIPE investors buying in at $10/share get 7% so Arrival is giving away 12% in the deal. The enterprise value is $5.4bn, enterprise value is market cap after deducting or adding any cash or debt respectively. In this case, they are receiving ~600m so the market cap at $10 a share is ~$6bn and enterprise is 5.4. To find todays market cap youd take ~6bn and multiply by~2.7 as price is 27ish, giving you market cap of around 16bn, you could then deduct the cash giving enterprise value of ~15.4bn.
I’d echo the sentiments on looking for a pullback, in the months it may take for merger to go through people will likely get bored and move onto the next thing. Even some of the exciting post merger SPAC’s like Luminar and Quantumscape will have several quarters of reporting negligible/0 revenue. I dont see how their prices will remain high barring a major collaboration announcement every month.
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There is a very large volume of short-term investments, but without a financial results base that attracts many funds and long-term investors, I believe that. So there can still be a lot of sell offs. In addition, these are new stocks and very susceptible to volatility, I think.
You only have to look at how volatile Workhorse has been the last few months. Perhaps a good one to trade over the next few months? I’m going to reduce my holding on Monday (already sold a few on Friday).
Workhorse’s shares are burning due to a delay from UPS to choose the winner for fleet renewal, but it’s not the first time they’ve delayed a contract, as I was reading. As they invested in Arrival, I’m not sure if a delay in ordering 10,000 EVs could occur or even some change. Either way, the stock price of these small businesses is easily affected by negative news.
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Yes I agree in that the UPS contract with Arrival looks safer but the contract is able to be changed by UPS and only an initial amount of vans are confirmed right now.
Workhorse did have a run up a few weeks ago to $30 (ignoring their jump from H1 this year), before dropping to $16 and recovering slightly.
To be expected really when you don’t have any real revenue yet (like Arrival until 2022).
I think the best thing to do in these cases is to enjoy the dips, so buying Arrival at this price doesn’t seem really interesting to me. Too risky.
I started in on CIIG on Thursday, will put a bit more in if it dips below 21 then just watch it ride for a while. Definitely going to be another up and down ride, but I think long term it has some good prospects and with the way the market is at the moment I think it’s a good stock to be in
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Great video! Do you have, or can you make…a video for Li Auto, Xpeng & NIO?? Would like to hear your thoughts…
Price is strong today
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this stock is mad! Up 33% today.
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I jumped in the dip last week, then jumped out 2/3rds end of last week. It all looks good in the portfolio, my 1/3rd is running away with itself, but it’s totally mad. Nothing there except promises and it’s valued at nearly $30bn right now.
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I think this could go either way to be honest. As the crowd becomes more familiar with the symbol, it may be seen as a way to get in on “the next Tesla” early and at a fraction of the price.
It’s never been anywhere near $30bn. That would be over $49 a share for the common
I based it off the formula I got from a YouTube video breaking down the SPAC and merger. The formula given was CIIC Market Cap / 0.04 ( % of Arrival for CIIC shareholders ).
Based on that, using market cap on Google, and $36 point something a share makes it $29 point something billion…
How did you arrive at $49 a share for $30bn?
The market cap at $10/share is roughly $6bn, you can use that to estimate market cap at any other price, at $25/share market cap will be roughly 15bn
Looking at the outstanding shares on merger shows you and @James101 are correct
606.179 million shares x $49.491 = $30bn
So the other day it was around $22bn.
Sorry, my bad 
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Arrival looks very strong, the hype might be justified on this one
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