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Electric vehicle technology startup REE Automotive has agreed to go public through a merger with a blank-cheque company, in a deal that values the Israeli firm at around US$3.6-billion, the companies said on Wednesday.

The deal with 10X Capital Venture Acquisition Corp. is expected to provide US$500-million in proceeds to REE. Shares of the blank-check were up nearly 46 per cent at US$15.99 in premarket trading.

The transaction includes a private investment of US$300-million from investors including Mahindra & Mahindra , Koch Strategic Platforms and Magna International Inc.

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The combined company will be listed on Nasdaq under the symbol “REE.”

Against the backdrop of an emerging electric vehicle market, Microvast, Faraday Future and EVgo Services are some of the companies in the industry that have agreed to merge with blank-checks so far this year.

Co-founded by chief executive officer Daniel Barel, REE makes products such as REEBoard, which is a flat, modular platform that can support autonomous vehicles. It also makes REEcorner, which according to the company’s website, “integrates all traditional vehicle components into the arch of the wheel.”

The firm signed an agreement with Indian carmaker Mahindra & Mahindra Ltd last year to explore joint development of electric commercial vehicles. REE also lists Mitsubishi Corp. and wheel and chassis maker Iochpe0Maxion SA as its partners on its website.

A special purpose acquisition company (SPAC), also known as a blank-cheque company, has the sole purpose of using proceeds from its initial public offering to buy a private firm, typically within two years. The private company then becomes public.

10X Capital went public in a US$175-million IPO in November. It is backed by a New York-based investment firm of the same name.

Mr. Cowen was the financial adviser to REE and Wells Fargo Securities advised 10X Capital.

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