RSVA Stock Price Increased Over 80% Intraday: Why It Happened

By Amit Chowdhry ● February 22, 2021
  • The stock price of Rodgers Silicon Valley Acquisition Corp (NASDAQ: RSVA) increased by over 80% during intraday trading. This is why it happened.

The stock price of Rodgers Silicon Valley Acquisition Corp (NASDAQ: RSVA) increased by over 80% during intraday trading as it went from a previous close of $15.75 to a day high of $28.50. Investors are responding to Enovix Corporation, the leader in the design and manufacture of next generation 3D Silicon Lithium-ion batteries, and Rodgers Silicon Valley Acquisition Corp. (Nasdaq: RSVA, RSVAU, RSVAW), a special purpose acquisition company (SPAC) announcing today that they have entered into a definitive agreement and plan of merger for a business combination that will result in Enovix becoming a publicly listed company. 

And upon closing of the transaction, which is expected to occur in the second quarter of 2021, the company will be named Enovix Corporation and is expected to remain listed on the Nasdaq Stock Market under the new ticker symbol “ENVX”.  The deal reflects an estimated pro forma enterprise value for the combined company of approximately $1.128 billion.  

Enovix has designed, developed, and sampled advanced lithium-ion batteries with energy densities five years ahead of current industry production. And the company’s first products include batteries with energy densities as high as 900 Wh/L. 

This breakthrough alters a 30-year trajectory of energy density improvements (<4.4% annually) by the Li-ion battery industry — which is modest by the standards of Silicon Valley and Moore’s Law. And unlike traditional “jelly roll” Li-ion batteries, Enovix products are encased in precision stainless steel and manufactured with a high-speed precision stacking process. This proprietary 3D cell architecture enables Enovix to use silicon as the only active lithium cycling material in the anode.

The proceeds from this deal will enable Enovix to build out its first two production facilities to support demand from blue chip customers in fast-growing mobile computing markets (wearables, mobile communications, PCs and AR/VR), totaling 1.78 GWh of capacity, while continuing to develop cells for EVs.

As part of the deal, Enovix is going to retain its highly experienced management team, led by Enovix co-founder and CEO Harrold Rust while gaining new board members Manny Hernandez and Dan McCranie from the Rodgers team.

The deal reflects an implied pro forma enterprise value of $1.128 billion. And upon the closing of the business combination and assuming no redemptions of shares of Rodgers by its public stockholders, Enovix will receive approximately $385 million in net cash after expenses. 

The proceeds will be funded through a combination of approximately $230 million cash in trust by Rodgers and a $175 million concurrent PIPE of common stock issued at $14 per share, anchored by leading institutional investors.

The boards of directors of both Enovix and Rodgers have unanimously approved the proposed transaction, which is expected to be completed in the second quarter of 2021. The deal is subject to, among other things, the approval of the stockholders of both Enovix and Rodgers, satisfaction or waiver of the conditions stated in the definitive merger agreement and other customary closing conditions.

KEY QUOTES:

“In 2007, the co-founders of Enovix set out to build a better battery by changing the cell architecture. Today, we stand at the threshold of producing the first advanced silicon-anode lithium-ion battery for mass-market applications from our U.S. manufacturing facility. Credit goes to the engineers and scientists of Enovix who designed and developed our advanced battery and our high-volume production operation. We are excited to partner with the accomplished team at RSVAC,” Rust added, “who understand that the success of any advanced product is the ability to produce it at scale. With their help and the capital provided by this transaction, Enovix will produce the advanced batteries that power our mobile future.”

— Harrold Rust, co-founder and Chief Executive Officer of Enovix

“Enovix has made industry-altering breakthroughs in two areas: battery design and battery manufacturing. Every chemistry professor has a better battery idea in his notebook. But only Enovix is building a world-class fab for actually putting a high-energy density silicon anode battery into the hands of the world’s leading technology companies. The company will have a big impact on products in mobile computing, wearables, and ultimately electric vehicles. Enovix has spent 13 years doing difficult work and refused to compromise on engineering integrity. Its toughness led Enovix to today’s transaction, and billions of consumers stand to benefit.”

— T.J. Rodgers, Chairman and Chief Executive Officer of Rodgers and a member of the board of directors of Enovix

“In my career, I have seen many claims of battery breakthroughs. But Enovix stands apart in that it has actually sampled cells based on its innovative architecture with leading customers and has a credible plan to manufacture at scale. Enovix has already delivered batteries with record-setting energy densities to customers and will do so at scale as soon as next year.” 

— Greg Reichow, a member of the board of directors of Enovix, a Partner at Eclipse Ventures and former VP of Production for Tesla

“The last speed limiter on how software can enhance our lives is battery energy density. Enovix technology alleviates those limits. When your vehicle’s computer can run another GPU core, you get home safely. When your phone can conduct real-time depth sensing, your video calls with family are more immersive. When your smartwatch can run a neural network locally, your health data is more secure. I am proud of Enovix’s twin breakthroughs in battery design and manufacturing, and we are honored to help them reach the public market.”

— Joseph Malchow, founding partner at the venture capital fund Hanover Technology, and a Rodgers board member

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