Lion Electric Company inks $142m funding deal with investor group

• The financing consists of the issuance of $74 million of senior unsecured convertible debentures to investors including Investissement Quebec, Fonds de solidarité FTQ and Fondaction
• It also consists of the issuance of C$90 million of senior secured non-convertible debentures to investors led by Mach Group and Mirella & Lino Saputo Foundation
• The deal is expected to close on or about July 19

Lion Electric Company, a Saint-Jérôme, Quebec-based manufacturer of all-electric medium and heavy-duty urban vehicles, has secured $142 million in financing.

The financing consists of the issuance of $74 million of senior unsecured convertible debentures to a group of investors including Investissement Quebec, Fonds de solidarité FTQ and Fondaction.

It also consists of the issuance of C$90 million of senior secured non-convertible debentures to a group of investors led by Mach Group and Mirella & Lino Saputo Foundation, as well as 22.5 million common share purchase warrants with an exercise price of C$2.81 per share.

The deal is expected to close on or about July 19, 2023, subject to the approval of the Toronto Stock Exchange and New York Stock Exchange and other customary closing conditions.

Lion Electric creates, designs and manufactures all-electric class 5 to class 8 commercial urban trucks and all-electric buses and minibuses for the school, paratransit and mass transit segments. It designs, builds and assembles many of its vehicles’ components, including chassis, battery packs, truck cabins and bus bodies.

Lion Electric plans to use the deal’s net proceeds for working capital, to strengthen its financial position and to pursue its growth strategy. The latter includes capacity expansion projects in Mirabel, Quebec and Joliet, Illinois.

“This financing transaction represents a key milestone for Lion, as it provides us with flexibility to execute our growth plans. We are extremely thankful to the province of Quebec and Investissement Quebec for their continued support of Lion, and to the new investors joining this round, including Fonds FTQ, Fondaction and a group of private investors led by Mach Group and the Mirella & Lino Saputo Foundation”, said Marc Bedard, founder and CEO of Lion, in a statement. “The diversity of this investor group, which stems both from the government and private sectors, speaks to the importance of Lion in the EV landscape”.

Lion Electric is also backed by Power Sustainable Capital, an affiliate of Power Corp of Canada.