The company builds hardware and software solutions that are needed for developing connected, automated, and electrified mobility


ECARX, an intelligent vehicle technology provider, to merge with COVA Acquisition. (Credit: Dariusz Sankowski from Pixabay)

ECARX, a Chinese mobility tech company, has agreed to merge with blank cheque company COVA Acquisition in a deal that values the combined entity at $3.82bn.

The deal with the special acquisition purpose company (SPAC) will enable ECARX to go public in the US with an expected listing on Nasdaq.

Founded in 2017, the Chinese firm builds hardware and software solutions that are needed for developing connected, automated, and electrified mobility.

The company caters to the global automotive industry and is claimed to have integrated its technology into more than 3.2 million cars.

Its co-founder Eric Li (Li Shufu) is also the founder and chairman of Chinese automotive company Zhejiang Geely Holding Group (Geely).

ECARX co-founder, chairman, and CEO Ziyu Shen said: “We believe vehicle DNA will transform more in the next decade than it has in the past hundred years, and this shift will drive an extensive change in OEM vehicle development, calling for all-new platforms, advanced computing power and continuous over-the-air software updates.

“ECARX’s vertically integrated, full-stack automotive computing platform and underlying core technologies are designed to help meet this evolving demand head-on.

“COVA’s leadership team has an exceptional track record backing high growth ventures, and we look forward to unlocking partnerships and paths for collaboration to accelerate development of next-generation technologies.”

Through the merger, the mobility tech company will gain $300m through cash held in trust by COVA and $45m in additional capital from strategic partners that include Geely and Luminar, as well as convertible note holder Lotus Technology.

Post-merger, ECARX’s existing shareholders are likely to hold a stake of around 89% in the combined company.

COVA board chairman and CEO Jun Hong Heng said: “Guided by the ambitions of co-founders Ziyu Shen and Eric Li (Li Shufu), ECARX is building on its strong foundation to forge new runways for growth both within China and internationally as it continues to scale.

“ECARX fits squarely into our approach and investment philosophy, which focuses on industries being disrupted by advances in technology and artificial intelligence. Together, we will create revolutionary solutions to shape the future of mobility.”

The deal, which is subject to the approval of both the firms’ shareholders, regulatory approvals, and other conditions, is anticipated to close in Q4 2022.