Lotus could enter China and float on the stock exchange as soon as next year
Parent company Geely is trying to pump serious money into the classic British brand
Ever since it was acquired by Chinese automotive giant Geely, it's looked like Lotus has been well on the way to getting back on track. Of course, we've all seen the mental Evija hypercar that'll be coming very soon and we all know about its plans to become a fully-electric manufacturer in the future, with a new generation of Lotus sports cars set to appear soon as well after their ICE descendants take their final bows. It's also begun a programme to certify its used cars to make buying a used Lotus as trouble-free as possible and has partnered up with Jenson Button's JBXE Extreme E team. Now, according to some reports, the next step of Lotus's evolution is well underway as Geely reportedly has huge plans for the classic British brand!
According to a report from Bloomberg that cites "people familiar with the matter " as sources, Geely is attempting to raise a huge amount of money so that Lotus can be brought into the Chinese market. This cash injection could be as much as $5 billion according to Bloomberg's sources and Geely is currently working with advisors to see if there is any potential interest. Geely is also considering an IPO of the company, which Bloomberg reckons could be valued at as much as $15 billion.
Lotus isn't the only Geely-owned company that's considering going public, either. According to another report from Bloomberg earlier this year, Polestar has been weighing up options about its future. These options could include taking the company public via a special purpose acquisition company (SPAC). This has been helped because of the explosion in demand for electric vehicles, particularly within Geely's home market of China, as well as the investor mania surrounding EV-specific companies such as Nio and Xpeng and smaller EV upstarts that are trying to get investors in a frenzy so they can use SPACs to race into the stock exchange.
Geely has been doing particularly well in the last few months. Shares in Geely Automobile Holdings Ltd. rose as much as 7.6% on Wednesday April 14, the company's biggest intraday gain since January 26. With a gain that significant in a period when business is still very much being affected by the pandemic, it's pretty easy to understand why Geely might be considering such an optimistic move as trying to raise money to get Lotus into the Chinese market or even floated onto the stock market in an IPO.
Of course, the deal and all the details associated with it are ongoing. Factors such as the size and timing of the deal could still change. A representative from Geely declined to comment when asked by Bloomberg and representatives from Lotus didn't immediately comment either. If this deal really is going ahead at full steam, Lotus and Geely are both definitely keeping it well under wraps.
Would this cash injection and a potential move towards being floated to the general public help Lotus? I absolutely think so. Any amount of financial help is nothing but good news for a brand that has always struggled with maintaining enough cash in its coffers. With more money on board, the development of the next generation of Lotus sports cars would be able to have a bigger budget. Hopefully, that would mean a brilliant bunch of new sports cars that'll give Lotus a great start into the first stage of its fully-electric future.