QuantumScape, the 10-year-old Silicon Valley battery startup backed by Volkswagen AG, mentioned on Thursday it plans to go public via a reverse merger with Kensington Capital Acquisition Corp with an enterprise worth of $3.Three billion.

San Jose-based QuantumScape, a 2010 spinout from Stanford College, mentioned it’s going to kind a three way partnership with VW to provide solid-state battery cells, beginning in 2024, for the German automaker’s electric vehicles, and finally for different carmakers.

“Our ambition is to be a (battery) provider to the trade as an entire,” QuantumScape founder and CEO Jagdeep Singh mentioned in an interview.

QuantumScape is the newest transportation startup to tie up with a special-purpose acquisition firm, or SPAC. Among the many latest SPAC-backed transactions: Lidar maker Luminar, electrical truck maker Nikola, electrical shuttle maker Canoo and electric car maker Fisker.

A SPAC is a shell firm that raises cash via an IPO to purchase a non-public working firm, sometimes inside two years.

Shares of the Kensington SPAC have been up 58.4% at $15.84 in late morning on Thursday.

VW has dedicated greater than $300 million to QuantumScape. Different company buyers embrace Shanghai Auto, which is partnered with VW in China, and German auto provider Continental AG.

Enterprise backers embrace Invoice Gates, Khosla Ventures and Kleiner Perkins. The Qatar Funding Authority additionally participated within the newest funding spherical.

Forward of the merger announcement, QuantumScape raised $500 million from institutional buyers, led by Constancy Administration & Analysis.

The SPAC deal is anticipated to shut in late 2020, when the brand new firm will commerce on the NYSE underneath the ticker image QS.

Singh mentioned QuantumScape’s lithium-metal battery makes use of a strong ceramic electrolyte which he mentioned is safer than a traditional liquid electrolyte. It additionally eliminates the necessity for an anode, permitting the battery to cost extra rapidly — as much as 80% capability in simply 15 minutes. Additionally, its power density is way greater, exceeding 400 watt-hours per kilogram, which far surpasses 250 Wh/kg for the very best present lithium-ion batteries.

“The corporate has a possibility to redefine the battery panorama,” mentioned J.B. Straubel, a member of QuantumScape’s board who’s CEO of battery recycling startup Redwood Supplies and a co-founder of Tesla.

Kensington is a SPAC headed by funding banker Justin Mirro, a specialist in transportation-related offers who will be a part of QuantumScape’s board. Kensington’s administrators embrace Tom LaSorda, former vice chairman of Chrysler; Don Runkle, former vice chairman of Delphi, and Matt Simoncini, former CEO of Lear Corp.

(Reporting by Paul Lienert in Detroit; Further reporting by Joshua Franklin in New York; Modifying by David Gregorio and Matthew Lewis)

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