- EV sales rising despite declining economy due in part to policy initiatives, government incentives
- EV share prices making triple-digit percentage gains since Q2 2020
- NETE divesting payments processing business model, entering EV industry through definitive merger agreement with Mullen Technologies
- Merger expected to accelerate process of taking Mullen public in addition to catalyzing manufacturing operations in United States
While sales of internal combustion vehicles continue to trend downward, electric vehicle (“EV”) sales are holding up – particularly in countries like Germany where EVs are heavily subsidized and central to the country’s economic recovery plan (http://ibn.fm/RqaIF). Investors continue diverting capital into the EV industry as a result, pushing EV stock prices to unprecedented levels. Through a bold move aimed at maximizing shareholder value, Net Element (NASDAQ: NETE) announced its plans recently to enter the EV industry through a definitive merger agreement with Mullen Technologies. Pending requisite approvals, the reverse-merger with the Southern California-based EV company will allow the stakeholders of privately-held Mullen to acquire a majority of the new stock and accelerate the process of taking the company public, giving potential investors an opportunity to buy the relatively undervalued shares within the rapidly growing sector.
“We feel, after considering an array of strategic alternatives, that the agreement with Mullen provides our shareholders with the most compelling opportunity,” said Net Element chairman and Chief Executive Officer Oleg Firer (http://ibn.fm/mOdKv). “We conducted an extensive search of companies that have disruptive technologies and believe that Mullen represents the best path forward.”
EV stocks have been on the rise since March – seemingly immunized against any COVID-related fallout by government-backed incentives that are pushing EV use on a global scale, particularly in Europe (http://ibn.fm/IzzCb) and China (http://ibn.fm/TsbTD). Despite their high volatility, EV stock prices saw massive net gains since last spring as Tesla shot up over 500% (http://ibn.fm/FJlCT), newly-public Nikola increased almost 300% (http://ibn.fm/Y1Yk5), NIO rose over 700% (http://ibn.fm/BxW9N), and Workhorse shot up 1000% within a few weeks (http://ibn.fm/BQPU9).
Investor sentiment appears to be fueled by research such as BloombergNEF’s latest report (http://ibn.fm/lVjQM) that paints a picture of an electrified future where EVs make up more than half of global passenger car sales by 2040, fueled in part by policymakers setting lower emission targets, fuel economy regulations, quota systems and urban policies that favor EVs. Besides their expected widespread adoption in the passenger market, EVs are also expected to account for 81% of municipal bus sales, 56% of commercial vehicle sales and 31% of the medium commercial market (http://ibn.fm/lgrnz).
Pending the definitive agreement, fairness valuation, stockholder and board approval, the merger between NETE and Mullen is expected to catalyze the process of taking Mullen public in addition to expanding its manufacturing operations in the United States through a proposed plant in West Plains, Washington. The agreement, once finalized, will give both new investors and existing stakeholders an unprecedented opportunity to invest in an industry that is poised to significantly alter the global transportation landscape while playing a key role in revitalizing the global economy.
For more information, visit the company’s website at www.NetElement.com.
NOTE TO INVESTORS: The latest news and updates relating to NETE are available in the company’s newsroom at http://ibn.fm/NETE
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