By Joanna Glasner
Romeo Systems, a maker of batteries for electric vehicles, offered a first glimpse at its financials in a securities filing for a planned public market debut later this year.
The Los Angeles-based company, which does business under the name Romeo Power, announced earlier this month that it plans to go public on the New York Stock Exchange through a merger with RMG Acquisition Corp., a blank-check acquirer. The deal sets an initial equity valuation of US$1.33 billion for Romeo.
The filing shows Romeo had revenue of just US$3.65 million in the first half of 2020, paired with a net loss of US$13.8 million. In the same period last year, the company posted revenue of US$1.86 million and a US$38.5 million loss.
As an early-stage company founded in 2016, Romeo’s value proposition lies in its potential future performance, and not so much on its revenue generation to date. The company’s pitch to investors is that it is poised to play a leading role in the ongoing market shift to zero-emission vehicles.
Romeo’s specialization is designing and manufacturing lithium-ion battery modules and packs for trucks and buses. To this end, the company completed construction of a 7 GWh-capable manufacturing facility in Los Angeles, where it is “able to innovate, develop and manufacture battery modules and packs in high volumes,” according to the filing.
Romeo Power’s core product offering serves the electric vehicle medium-duty short-haul and heavy-duty long-haul trucking markets, as well as the specialty trucking and bus sectors.
A key investor and customer for the company is Michigan-based automotive supplier BorgWarner, known for its powertrain products. The two companies announced a joint venture last year that is focused on development of batteries and packs for electric vehicles. Romeo owns 40 per cent of the venture, while BorgWarner controls the remaining 60 percent.
Previously, Romeo raised US$123 million in known venture funding as well as a corporate investment of undisclosed size from BorgWarner. Other backers include HG Ventures and OpenDoor Venture Capital.
The company’s decision to pursue a public listing comes as an increasing number of venture-backed transportation technology startups are taking the same route. Others that have announced plans recently for a public listing via a merger with a blank-check company include electric carmaker Fisker, vehicle charging station-maker ChargePoint, and electric powertrain developer XL Fleet. https://news.crunchbase.com