Chijet Motor To Go Public Through Merger With Deep Medicine Acquisition (DMAQ)

By Amit Chowdhry ● Jul 13, 2022
  • Chijet Motor announced a plan to go public through a merger with Deep Medicine Acquisition Corp. (NASDAQ: DMAQ). These are the details.

Deep Medicine Acquisition (NASDAQ: DMAQ), a publicly traded special purpose acquisition company, announced the signing of a definitive business combination agreement, dated July 12, 2022, with Chijet Motor Company, a leading Chinese automaker, which is developing next-generation electric vehicles and expanding its manufacturing capabilities. And Chijet expects to use the transaction proceeds to fund the development and production of its planned next-generation electric vehicle with sales expected to increase as new models are launched and two production facilities, occupying a total area of 8.47 million square feet with an annual production capacity of 200,000 vehicles currently under construction in Xiangyang and Yantai, China, are completed.

Chijet is currently focused on expanding the business of electric vehicles while manufacturing, selling, and servicing traditional fuel vehicles. And currently, the company sells vehicles to more than 300 dealerships in China and the rest of Southeast Asia, and produces a variety of models through its Chinese subsidiary FAW Jilin Automobile Co., Ltd, including 3 SUV models sold under the Senya brand and 4 light truck models sold under the Jiabao brand. And Chijet partners with FAW Group, one of the ‘Big Four’ auto manufacturers in China.

With more than 3 million cars produced and over $100 billion in annual revenue in 2021, FAW ranked 66th on the Fortune 500 Global list in 2021. And in 2019, Chijet indirectly purchased a 64.28% interest in FAW Jilin from FAW. Plus Chijet is building a 5.15 million-square-foot factory in Yantai, China, dedicated to electric vehicle production and a new planned headquarters.

Chijet has a management team of industry veterans with decades of experience in engineering and design, management, financing, industrial production, and financial management. And the FAW Jilin production subsidiary has passed IATF16949 quality management system certification, ISO45001 occupational health and safety management system certification, ISO14001 environmental management system certification and ISO50001 energy management system certification. These certification registrations cover the design and manufacture of the sedan and minicar range.

Compared with its competitors, Chijet noted it has superior advantages in its production and supply chain. And its executive team has extensive experience in production technology and a management style modeled on Toyota Motor Corporation. The completion of construction of the two new production facilities and corporate new offices is expected to strengthen and optimize Chijet’s production capacity of electric vehicles, hybrid vehicles and gasoline vehicles. In addition, Chijet has established strong relationships with top institutions and suppliers from all over the world.

The business combination attributes an implied enterprise value to Chijet’s operating companies of $2.55 billion in the aggregate, including Chijet’s 85.17% ownership interest in Shandong Baoya New Energy Vehicle Co., Ltd., the Chinese company that is developing new EV models, and 64.82% interest in FAW Jilin, the Chinese company producing and selling traditional fuel vehicles. And upon completion of the transaction, Chijet is expected to have approximately $127.8 million in cash, assuming no redemptions by DMAQ public shareholders. The cash proceeds raised in the transaction are currently anticipated to be used for the construction of Chijet’s Yantai electric vehicle manufacturing base and to fund company operations, support its growth and for general company operating purposes. And following completion of the proposed transaction, Chijet plans to raise additional capital to further its planned expansion of production capacity and product offering to include new models of electric vehicles.

With the proposed transaction, both Chijet and DMAQ will be acquired by a newly-formed holding company named Chijet Motor Company, Inc (Pubco), which is expected to be listed on the Nasdaq Stock Market.

The boards of directors of DMAQ and Chijet have unanimously approved the proposed transaction. And its closing is subject to approval by DMAQ stockholders, completion of DMAQ’s satisfactory due diligence review of Chijet within 60 days of entering into the business combination agreement and is subject to other customary closing conditions. It is currently expected that the transaction will close by the end of the fourth quarter of 2022, assuming such closing conditions are met.


“We are focused on our vision to develop and produce electric vehicles with the latest energy-saving technologies, which has never been more important than today given the soaring cost of oil. Our management team is committed to delivering on our plans to expand our electric vehicle business and leverage our existing dealer network, our manufacturing permits and licenses, and supply chain and production capabilities.”

— Chijet Chairman Mu Hongwei

“We are delighted to have entered into a definitive agreement with Chijet and its experienced management team. Chijet designs, manufactures, markets and services a full line of cars, mini-trucks, sport utility vehicles and electric vehicles. China’s automotive market, especially the electric vehicle market, is growing substantially and Chijet’s current and planned products will target customers who are looking for cost-effective means of transportation. As a major player in this field, and with its relationship with China’s leading automaker FAW Group, Chijet has shown that it is capable of offering electric vehicles based on the latest technology. Therefore, we believe that Chijet will continue to expand its market position as the electric vehicle industry expands. DMAQ and our investors are excited to be part of Chijet and join their talented team to achieve their goals.”

— Humphrey Polanen, CEO of DMAQ

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.