Beta Draws IPO Order Rush as Electric Aircraft’s Moment Comes
Company Is Focused on Initially Prioritizing Cargo and Logistics Over Passenger Travel Market
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Investors are warming to Beta Technologies' initial public offering as the electric aircraft developer and its peers look to distance themselves from unhappy associations with the 2021 blank-check company boom and bust.
The electric aircraft developer’s IPO is double-digits oversubscribed and is expected to price at $34 per share, above the $27-to-$33 marketing range, according to people familiar with the matter. That would give it a market value of more than $7.6 billion including a potential upsize option. That would pit it squarely between two publicly traded peers, Joby Aviation at $14.4 billion and Archer Aviation at $6.8 billion, according to data compiled by Bloomberg.
A representative for Beta didn’t respond to a request for comment.
Joby and Archer went public during the special purpose acquisition company boom, when investors were particularly receptive to early-stage companies — at least, for awhile. Both firms spent most of the period since then trading below their original $10 per share SPAC IPO price, but their shares have rallied over the past year or so on high-profile partnerships. The resurgence, and Beta’s IPO, are spurring hopes that relatively quiet and inexpensive-to-operate electric aircraft will soon become a regular sight in the nation’s skies.
“There is hot demand because there will be a market, there will be a product, and certification is something that is coming,” said Francois Duflot, Bloomberg Intelligence’s aerospace analyst and a witness to a demonstration of Beta’s conventional aircraft at June’s Paris Air Show. “The question is when, and do investors underestimate the time and money that will be needed to get there?”
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Founded in 2018 by CEO Kyle Clark, Beta has already racked up nearly 83,000 nautical miles of flight history for its conventional takeoff and landing aircraft, according to itsfilingswith the U.S. Securities and Exchange Commission. The company is focused on initially prioritizing cargo and logistics over the larger passenger travel market.
The company is seeking regulatory certification of that aircraft at the end of next year or in early 2027, and for its vertical takeoff and landing vehicles, at the end of 2027 or early 2028. Both already have backlogs of hundreds of orders.
For Beta and its peers, high-profile backers can help assuage concerns. General Electric Co., which formed a strategic partnership with Beta in September and made a $300 million investment, is also among the cornerstone investors agreeing to buy as much as $300 million in the IPO, more than a third of the base offering. Beta’s roster of existing investors also includes Amazon.com Inc. and biotech United Therapeutics Corp.
Amazon.com Inc. ranks No. 1on theTransport Topics Top 100 list of the largest logistics companiesin North America, No. 15 on theTT Top 100 list of the largest private carriersand No. 1 on theTT Top 50 global freight list.
Joby, whose stock has climbed 110% in the year to date, announced a collaboration in October with no less than AI chip high-flyer Nvidia Corp. as the only aviation launch partner for its new platform. Archer Aviation shares have more than tripled in the past 12 months, getting a sizable boost in December 2024 after sealing a partnership with weapons maker Anduril Industries to build a hybrid military aircraft.
Beta’s limited revenue and net loss may give some investors pause, even in an environment where a company like Fermi Inc., an AI infrastructure developer with a similarly limited operatinghistory, can snare a $15 billion-plus valuation in its debut.
Matt Kennedy, senior IPO market strategist at research and ETF firm Renaissance Capital, says the market for first-time share sales is about betting on new technology before it’s widely adopted.
“It’s definitely the type of company that would have normally gone public via a SPAC like Joby and Archer did, but we are starting to see some of these early-stage companies go public at multibillion-dollar market valuations helped by strong peers and demand for their shares,” Kennedy said.
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