Volta, a very unique charging network, will be acquired by Shell USA (a subsidiary of Shell plc) in an all-cash transaction valued at approximately $169 million.
The transaction is expected to close in the first half of 2023, which would add on top of multiple other acquisitions conducted by Shell around the world, as the group prepares for mass electrification.
Volta is a quite interesting company, as it operates a dual charging and media network - charging stalls display ads while the charging itself is usually free.
According to the recent Q3 2022 financial report, Volta has some 983 charging sites in the United States, including 3,093 charging stalls and 5,627 screens (*some stalls do not have screens, and some wall-mounted stalls have a single screen). The number of stalls increased by some 45 percent year-over-year.
As the EV charging business is a new one and has been constantly evolving over the last 10+ years, we don't really know whether dual charging and media network will succeed.
Even the more conventional charging networks, which require EV drivers to pay for charging, were struggling during the past decade.
In the case of Volta, we can see quickly growing revenues (by 66 percent year-over-year in Q3), but at the same time, the revenues are still not high enough to cover costs.
The report indicates that in Q3 alone, the company noted a net loss of $42.5 million, while during the nine-month period, it was $128 million, compared to $38 million in revenues.
That would explain why the start-up will be acquired by a bigger player like Shell. The expansion of such a network, even with mostly Level 2 AC charging stalls, requires serious cash, before the scale would be enough to eventually generate profits.
It will be very interesting to see Shell's strategy. The company said that following the completion of the transaction, there will be no immediate change in driver experience.
In the long-term, we might see a mix of Shell conventional charging stations with an additional advertiser-sponsored stalls maybe.
