The British auto data startup Wejo which is supported by the United States based auto giant General Motors Co, was accorded a valuation of $800 million including debt in a reverse merger deal with blank-check company Virtuoso Acquisition Corp for it to go public, the companies said on Friday.

The companies added that the deal will raise $330 million in proceeds for Wejo which will include $230 million from Special-Purpose Acquisition Company (SPAC) Virtuoso and another $100 million referred to as Private Investment in Public Equity (PIPE).

Institutional investors make up most of the PIPE, said Wejo Chief Executive and founder Richard Barlow. He however did not say the names of the companies involved. He added that the company was still negotiating with other potential investors which could help it to raise an additional $25 million within the next month.

The top auto company of the United States GE is among the investors included in the PIPE. GE had also previously invested in the startup.  The investors also include the data management company Palantir Technologies Inc which was co-founded by the billionaire Peter Thiel. This was revealed in their statements by Wejo and Virtuoso.The sizes of their investments or stakes were not disclosed.

The $800 million enterprise value for Wejo implies an estimated $1.1 billion pro forma equity value.

“The future is data and this is a company that’s sitting there right in the middle of this incredible wave of data that’s coming,” Virtuoso CEO Jeffrey Warshaw said in an interview. “All this opportunity to monetize it, it’s almost limitless.”

The companies said that the merger of Wejo with Virtuoso will expectedly be completed in the second half of the year. The companies have not yet determined the stock exchange but the new company will trade under the symbol “WEJO”,

Going public through an SPAC have become popular in recent times. SPSCs are essentially shell companies that raise funds for acquiring a private company and then take it public which allows such companies to avoid the complexities of a traditional initial public offering (IPO) for going public.

There were reports in March about the merger of Wejo and those reports had pegged the value of the company at more than $2 billion.

Despite being in popularity even during the Covid-19 pandemic, the SPAC market has cooled off in recent months because of concerns of frothy valuations. There were also suggestions by the SEC last week about considering and accounting for the warrants issued by SPAC as liabilities and not as equity instruments.

Data from almost 11 million vehicles connected to the Internet via modems that are fitted on the vehicles of its clients such as GM, Hyundai Motor Co and Daimler is collected and organized by the Manchester-based Wejo.

Such data can be used by auto companies to develop apps and services for fleets, smart cities and individual consumers as well as for advertising. Such data can also be used for fleet management, insurance, remote diagnostics, roadside assistance, parking availability and traffic information.

“Getting the data-software piece right is going to be critical for making the next best product,” Palantir global head of business development Kevin Kawasaki said.

(Adapted from Nasdaq.com)