Almost two years after its first car partnership and first country deployment in Israel, California-headquartered electric vehicle service provider Better Place has signed an agreement with an HSBC-led investor consortium for new equity financing of $350m, valuing Better Place at $1.25bn.
The series B equity financing round features participation from new investors including HSBC, Morgan Stanley Investment Management and Lazard Asset Management, joining existing series A investors Israel Corporation, VantagePoint Venture Partners, Ofer Hi-Tech Holdings, Morgan Stanley Principal Investments and Maniv Energy Capital among others, as shareholders of Better Place.
HSBC led the round with $125m, one of its largest financial investments. As part of the deal, following which HSBC will own ten per cent of the company’s shares, HSBC’s head of global capital financing Kevin Adeson will join Better Place’s board of directors.
The Better Place switchable battery solution addresses the range limitation of fixed battery electric cars as an alternative to current combustion engine and hybrid vehicles. Better Place said the financing will allow it to expand its geographic footprint while continuing to execute its R&D and deployment milestones. The company said it intends to expand into markets where the business model economics and investor returns are optimised, such as Europe and Asia.
Stuart Gulliver, executive director of HSBC Holdings and chief executive of global banking and markets, said, “We believe the switch from internal combustion engine vehicles to electric vehicles will create future growth opportunities in the auto and utility industries, and we are delighted to take the opportunity of investing in Better Place to put HSBC at the heart of these developments. Better Place is a private-sector solution to the issue of infrastructure provision for electric cars and can succeed without government subsidy and without sacrificing consumer expectations for personal mobility.”
Better Place said it has continued to meet its timetable to launch in Israel and Denmark at the end of 2011, when the first Renault switchable battery electric cars hit the road. The company also said it will continue to execute against its strategy of early deployment projects in Australia and select North American markets a few months after launching in Israel and Denmark.
The company’s R&D team is currently testing each element of the Better Place solution in global real-life scenarios in a multi-phase cycle, which started with the managed electric vehicle network in Denmark last December and will continue with a Tokyo electric taxi project with battery switch station in April this year. The company said the development milestones will lead up to full-scale trials in the second half of 2010 and commercial launch in 2011.
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