Vertical wins $4b pre-order contracts, plans to go public

Bloomberg

Vertical Aerospace Group Ltd, the developer of electric vertical takeoff and landing aircraft, won pre-order contracts of as much as $4 billion as it plans to go public through a merger with a blank-check company.
American Airlines Group Inc, Virgin Atlantic Airways Ltd and aircraft lessor Avolon Holdings Ltd agreed to buy as many as 1,000 of the vertical takeoff and landing aircraft, or eVTOLs, from Vertical Aerospace, the company’s first commercial order, according to a statement.
It is going public through a reverse merger with Broadstone Acquisition Corp in a deal that values the combined companies’ equity at about $2.2 billion.
Vertical Aerospace and the special purpose acquisition company also raised money through a private placement from investors including 40 North, an affiliate of Microsoft Corp, American Airlines, Avolon, Rolls-Royce Holdings Plc and Honeywell International Inc.
The transaction is expected to close in the second half of the year. Vertical is developing the VA-X4, a zero-emission four-passenger aircraft that it says can fly as fast as 200 miles per hour over a range of more than 100 miles. The company plans to conduct its first test flight of the VA-X4 later this year, with certification as early as 2024.
Founded in 2016 by Stephen Fitzpatrick, the company plans to deliver the orders between 2024 and 2027, Fitzpatrick said.
“There’s a real appetite in the US public market for this kind of technology,” said Fitzpatrick. “It’s not just flying taxi. This is the dawn of the electric aviation era.”
Avolon, an aircraft leasing company, said it may take as many as 500 of the aircraft in a deal valued at $2 billion. It expects to place them with other airlines and possibly new operators, and will use its network to help Vertical gain more orders, Avolon CEO Domhnal Slattery said in an interview. Avolon is investing $15 million in the company, he said. “We believe that this is the beginning of the next big evolution of urban air mobility,” Slattery said. “This is probably as significant as the jet age.”
The lessor agreed to order 310 of the eVTOLs with an option for an additional 190. American Airlines, which is investing $25 million in Vertical, placed a nonbinding order for 250 aircraft valued at about
$1 billion, with an option to purchase another 100.
American also will help
Vertical work on passenger operations and infrastructure development in the US. The airline said its order, which is part of a commitment to cut carbon emissions, could allow it to transport customers quickly between city centres and airports.