SPAC Watch: VectoIQ Prepares for its Second SPAC; Investors May be Cautious after Nikola Saga
January 11, 2021

VectoIQ Acquisition Corporation II priced its $300mm IPO last week. They will be targeting an industrial technology, transportation and smart mobility business. While a specific price range was not announced, VectoIQ stated a middle-market business will be ideal.

This is the second SPAC for the team, following the very well publicized round 1 with Nikola (NKLA) that was at first lauded and then experienced an escalating set of controversies.

The VectoIQ Team

VectoIQ returns the same team from the Nikola deal, led by Girsky.

Stephen Girsky: Girsky is the CEO of VectoIQ Acquisition. He is currently a managing partner of VectoIQ, and has previous leadership experience at General Motors Company and Centerbridge Industrial Partners.

Mary Chan: Chan is President and COO of VectoIQ Acquisition. She is also a managing partner at VectoIQ, and has previous leadership experience at General Motors Company and Dell.

Steve Shindler: Shindler is CFO of VectoIQ Acquisition. He currently is a director of NII Holdings, and has previous leadership experience at NII and Nextel Communications.

In addition to management, VectoIQ has assembled four knowledgeable nominees for the SPAC’s board.

Sarah Hallac: Hallac is retired investment banker, who has expeience consulting for BlackRock. She served on the board of the first VectoIQ SPAC.

Richard Lynch (D): Lynch is president of consulting firm FB Associated, and has previous leadership experience at Verizon. He served on the board of the first VectoIQ SPAC.

Sherwin Prior : Prior is Director of U.S. ventures at Orbia, a venture capital firm. He has previous leadership experience at numerous other VC firms.

Marc Sulam: Sulam is Managing Member of Healy Circle, a hedge fund.

Round 1: VectoIQ Acquisition Corporation

The first VectoIQ SPAC took alternative fuel source automobile company Nikola (NKLA) public.

  • The first VectoIQ Acquisition Corporation raised $200mm
  • The deal was announced March 3rd
  • Valued Nikola at an enterprise valuation of $3.3b, for a multiple of 16.6x EV/IPO
  • Included a $525m PIPE

Investor intrigue shot Nikola shares up to $80, resulting in a new market cap more than 10x its SPAC valuation. The hot streak was short-lived, with subsequent analyst downgrades and warrant controversy dragging down returns. Then the bodyblow came: a damning short seller report from September accusing Nikola of “Fraud”, resulting in the departure of co-founder and executive chairman Trevor Milton from the company. Current share prices of $17 give the company a market capitalization of $6.56b.

Nikola Corporation performance since listing

Take Away

The VectoIQ team has shown that they can find a deal and get it done. However, given the major issues around Nikola post-merger and the absolute glut of SPACs in and coming to the market, investors may be much more cautious the second time around.

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