By Alan Hatfield
Electric vehicle charging solutions provider Allego Holding B.V. announced in July that it plans to list on the New York Stock Exchange through a merger with Spartan Acquisition Corp. III (NYSE: SPAQ). Allego delivers end-to-end charging solutions to make it easier for businesses and cities to deliver the infrastructure needed by drivers of electric cars, motors, buses and trucks across an international charging network comprised of more than 26,000 charge points operational throughout Europe.
IPO Edge sat down with Allego CEO Mathieu Bonnet to find out more.
IPO Edge: Let’s start at the top. Could you give us a 10,000 foot view of Allego for those of us in North America who aren’t familiar with the company?
Yes, sure. So first of all, thank you very much again for having us, as we’re very excited to present Allego. We are the leading pan-European, fast and ultra-fast public charging network and we have pioneered the field in Europe, first in the Netherlands, and now in more than 12 countries. We have a very high top line because of our recurring revenue. We sell charging stations to our EV drivers and we have a very diverse customer base of corporate customers to whom we sell our charging solution. We have a very strong, proprietary technology platform that enables us to manage hundreds of thousands of charging stations already. We can manage in real time the energy we sell in real time and we process all the payments as well.
So with this, we think we are very well positioned to make the most of the supercharge rules of the EV industry. It’s really a revolution in Europe because we are shifting dramatically from fuel car to EVs. Already, we have more than 10% EV penetration for full battery vehicles, compared with old battery sales by month.
IPO Edge: Fantastic. Now before we dive into the details, we cover a lot of SPACs here at IPO-Edge and we always like to ask the question, why go public via a SPAC and why now?
Given the history we have, we have already shown that we have a very strong technology with almost 27,000 chargers on the ground in the different countries already. We are also ready to roll out our fast and super-fast charging station in all the countries we are in currently. To do that, we need to have some capital investment, and that’s the reason why we considered the SPAC route an efficient one. This kind of transaction also allows us to partner with a knowledgeable, very strong partner, which is something we wanted. We are very happy to have chosen to work with Apollo and Spartan, as they offer the kind of partnership we needed. So for us, it was a very interesting way to proceed. And we are very excited to reach out to the American investor with this transaction, because we will be listed on the New York Stock Exchange.
IPO Edge: Give us a sense of the competition in Europe, and in particular where you fit into that landscape.
In terms of true players, we are number one in the different countries we operate in. However, we are a bit distant from other networks because we are mostly in suburban areas and especially near big retail malls. We believe that’s where people actually are, and if you need to go to the highway to charge and ultra-fast charge, that’s a bit cumbersome. We will continue to develop highway charging, but at least that’s our peculiarity. And in term of market share right now, in the different countries we are in, we are around 12%. Because it is quite fragmented, with that our European footprint is number one.
I wouldn’t call certain other kinds of networks competitors to our pan-European network, because they don’t serve the same kind of customer. Local networks just focus on the areas they serve. Utilities networks will focus on individual countries or parts of countries. Then we have networks to address big roads and highways specifically. That’s usually OEM (Original Equipment Manufacturer) gas companies. In Europe, I think they’re moving quicker than in the US. Shell, BP, and Total are beginning to put some chargers in their fueling stations. But again, we don’t have the same sites, so we are not really competing with them right now. Otherwise, we have barriers to entry because it is CapEx (Capital Expenditure) intensive, so we don’t see many other newcomers to the market. We might also anticipate some consolidation in the industry along this journey.
IPO Edge: Can you just explain how customers look at you, and do you think a lot about brand building in that regard?
Yes, we do think that the brand is going to be important. The first thing you want to have is to be sure that customers can charge their vehicles, especially since this is a newer industry. Reliability is key because you don’t want to be stuck somewhere because your charger does not work. It requires the electricity itself, installing the chargers even in more rural areas, and a working payment structure. That’s reliability. When you get that, you build trust. When you know a station and you get used to charging at one, it’s convenient and for whatever reason you’re also likelier to have a shop all around it, tending to go to the same one. That’s a pattern we’ve seen with all the data we have. That’s the reason why we always see ramp up in the utilization rate of our charging stations.
IPO Edge: Are there some specific qualities that attracted you to Apollo as a partner?
Well, first of all, they know a lot about infrastructure, let alone their general expertise, and that was one reason why it was important for us to partner together. They have also invested in a pure EV OEM, Fisker. We have a relationship with them in terms of technology, and we are very proud of that because they bring us customer experience, which is of course very valuable to understanding the seamless charging experience. Apollo is here to bring that as well as help us understand where the relevant American investors are. I think that’s quite interesting because we can bring a flavor of Europe to American investors with this operation through Allego.