Lilium SPAC IPO: Everything you need to know about Lilium
Rebecca Cattlin September 7, 2021 7:45 PM
Flying-taxi firm Lilium went public via a SPAC deal in September 2021. Discover everything you need to know about the company before you take a position.
Is Lilium publicly traded?
Lilium went public on the Nasdaq on September 15 2021 through a merger with Qell Acquisition Corp. It's ordinary shares started trading at $10, as most SPAC stocks do, under the ticker symbol LILM. A month after the IPO it was trading nearer to $9.02 despite some estimates it would hit nearer to $20.
Qell is led by Barry Engle, the former president of General Motors North America, and the SPAC company has a specific focus on next-generation sustainable motoring.
Total gross proceeds to the company were $830 million, including $380 million in cash currently held in trust and the proceeds of a $450 million private investment in public equity (PIPE).
Investors include Baillie Gifford, funds and accounts managed by BlackRock, Tencent, Ferrovial, LGT and its direct impact investing arm Lightrock, Palantir, Atomico, FII Institute and private funds affiliated with PIMCO.
Learn more about SPACs and how they work
How to trade Lilium
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- Choose your position and size, and your stop and limit levels
- Place the trade
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How much is Lilium worth?
Lilium’s SPAC deal values the combined company at a pro forma enterprise value of $2.4 billion and an approximately $3.3 billion pro forma equity value at the $10 per share PIPE price – according to a press statement from the company.
In March 2020, Lilium completed an internal funding round worth more than $240 million. The round was led by Chinese tech giant Tencent, with other existing investors including Atomico, Freigeist and LGT.
What does Lilium do?
Lilium GmbH is a German aerospace company that is one of the global leaders in electric air mobility. It was founded in 2015 by engineering students at the Technical University of Munich; Daniel Wiegand, Sebastian Born, Matthias Meiner and Patrick Nathen.
Lilium designs and develops emissions-free regional air mobility services, including its prototyped Lilium Jet.
The seven-seater Lilium Jet is a high-speed regional shuttle service that will provide travel for both people and goods faster than rail or road, but just as competitive in price. The shuttle takes off vertically, which minimises the ground infrastructure needed – meaning Lilium can create landing sites in more highly-populated areas. The electric aircraft is expected to be an inter-city flying taxi service in 2025.
The first prototype of the aircraft flew in May 2019 as a five-seater, fully-electric take-off and land vertically (eVTOL) vehicle. The company has projected that by 2027 it will have 1,000 jets in operation with 30,000 tickets sold.
How does Lilium make money?
Once Lilium’s jets are operational, it will be selling them for an estimated $2.5 million apiece, although it’s likely this figure could decrease as manufacturing operations scale up.
Lilium expects that ticket sales will make back this initial investment. Based on calculations of 4.5 of every six seats being filled, Lilium expects to make $10 in revenue per mile, a daily revenue of $15,000 per jet – which totals an annual revenue of $5 million per jet.
Is Lilium profitable?
No, currently Lilium is not profitable. As outlined, the company has projected that it will make $5 million in revenue per jet, per year and is aiming to achieve profitability by the end of 2025.
However, this seems quite ambitious. Lilium aims to begin flight testing of its aircraft in 2022 and to win safety certification by the end of 2023. That’s a short timeline for conventional airplanes – which can take from one to five years to be approved – let alone an eVTOL, baring in mind that no similar vehicle has managed to jump through the regulatory hoops yet.
What is Lilium's business strategy?
Lilium states that its vision is to ‘create a sustainable and accessible mode of high-speed travel’ and will eventually aim to bring its technology to every community in order to fix the current transport system. The company expects to tap into a sizeable global market that connects communities at a fraction of the cost of conventional high-speed infrastructure, with zero operating emissions.
The proceeds from the SPAC deal are going to be used to fund the launch of the company’s commercial operations, hopefully as soon as 2024. This includes putting the finishing touches on its facilities in Germany, launching the production of its aircraft and completing its certifications.
Lilium’s aircraft will have 30 times fewer components than a commercial airliner, which the company says will make it easier to manufacture and scale production. In the coming years, Lilium hopes to develop a 16-seater aircraft.
To help with its manufacturing launch, Lilium has partnerships with world-leading aerospace, technology and infrastructure companies. These include Toray Industries, who will be providing the carbon composites for the aircraft’s primary structures; Aciturri, who are manufacturing the fuselage and wing systems; and Lufthansa Aviation Training, who will be training Lilium’s pilots. Lilium’s partnerships with Ferrovial and Tavistock Development will also be responsible for building and operating up to 14 vertiport sites across Europe.
However, earlier this year three former Lilium employees anonymously spoke to Forbes about the internal frustrations of employees. They said that said that Wiegand has held to an unrealistic timeline in the face of development delays, pushback from his engineers and a planning process that was throwing up red flags.
Who owns Lilium?
Lilium's shareholders notably include Tencent, Palantir and Honeywell. At the time of the SPAC, existing investors' rolled 100% of their shares into the combined company.
Lilium CEO Daniel Wiegand will hold 3:1 super voting shares upon completion of the transaction.
Who are Lilium’s competitors?
Lilium is part of a growing list of electric vertical takeoff and lift companies that are going public through SPAC deals including Joby Aviation (RTP) and Archer Aviation.
Joby Aviation started trading under the ticker ‘JOBY’ via a SPAC deal. According to the company, its eVTOL (electric vertical takeoff and landing) jet can transport four passengers and a pilot, flying up to 150 miles on a single charge with a cruising speed of 200 mph. That’s faster than Lilium’s jet, which only boasts flying speeds of 175 mph but has higher passenger capacity and a maximum range of over 155 miles.
Archer Aviation is preparing to go public via a SPAC deal, but recently had its valuation cut by $1 billion. Archer’s Maker aircraft can only travel in a 60-mile range and up to 150 mph.
Unlike its competitors, Lilium has yet to log as many flights, which could end up delaying its progression through regulatory certificates.
Board of directors of Lilium
- Daniel Wiegand, board member, CEO and co-founder of Lilium
- Tom Enders, board member and former CEO Airbus
- Frank Thelen, board member and CEO of Freigeist Capital
- David Wallerstein, board member and Chief eXploration Officer at Tencent
- Niklas Zennström, board member and founder of Skype
- Gabrielle Toledano, board member and COO of Keystone Strategy
- Henri Courpron, board member and President and CEO of Airbus
Following the merger, Qell CEO Barry Engle was added to the board along with Chairman of Azul Brazilian Airlines David Neeleman.
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