A blank cheque company backed by investment banker Ken Moelis has agreed to merge with electric aircraft maker Archer, marking the first public listing of a company that hopes to commercialise urban air taxis.

Archer, which is trying to develop electric aircraft to transport urban commuters across cities, is combining with Moelis’ $500m special purpose acquisition vehicle Atlas Crest at a $3.8bn valuation.

Archer is the latest electric vehicle company to go public via a merger with a Spac, although most have yet to book any revenue or make a commercially viable product. Archer plans to unveil its prototype aircraft later this year.

Electric vehicle start-ups have been a favourite for Spacs, which take companies public by raising money from investors and then cutting deals, as well as retail investors hoping to bet on the next Tesla-like company.

Despite not having produced a vehicle for the market, Archer said United Airlines has committed to an order worth $1bn — a strong endorsement for the company founded by Brett Adcock and Adam Goldstein.

United hopes the electric vertical take-off and landing (eVTOL) vehicles will help it reduce its emissions by 50 per cent per passenger on a trip between Hollywood and Los Angeles International Airport, which is one of the first places Archer plans to launch its fleet. Archer said it expected its vehicles to travel distances of up to 60 miles at 150mph.

“Archer’s eVTOL design, manufacturing model and engineering expertise have the clear potential to change how people commute within major metropolitan cities all over the world,'“ said Scott Kirby, United’s chief executive.

The commitment from United comes a month after Fiat Chrysler agreed to give the Palo Alto group access to the carmaker’s supply chain to help Archer lower the cost of manufacturing electric aircraft.

Under the terms of the deal, Moelis’ Spac will inject about $500m into Archer. An additional $600m will come from a group of investors that includes United, Fiat Chrysler’s holding company Stellantis and the venture arm of Exor, the investment vehicle of Italy’s Agnelli family. Other investors include Baron Capital Group, the Federated Hermes Kaufmann Funds, Mubadala Capital, Putnam Investments and Access Industries.

“We founded Archer to address the environmental and societal issues caused by road transportation and urban overloading,” said Goldstein, Archer’s co-founder and co-chief executive.

“What started with a handshake deal from our lead investor and adviser Marc Lore, Archer’s latest funding and acquisition news brings this vision to life in a big way, enabling us to accelerate the future of sustainable travel at scale.”