U.S. Investors Lean on Blank-Check Firms in Search for Energy Transition Targets

Healthcare, financial technology and autonomous vehicles continue to be heavily represented, but alternative energy is gaining traction, the data shows.

“I would expect there would be more energy-related SPAC mergers,” Ritter said.

According to Reuters interviews with eight advisors, at least 10 companies are looking to launch additional renewable SPACs, beyond the 20 that have already publicly filed.

By contrast, only about three exploration and production SPACs are currently publicly filed with the SEC and none have launched in about 18 months, a sharp contrast with 2016 when oil prices crashed, and investors used SPACs to buy companies in a turnaround bet.

SPACs are publicly traded vehicles that raise capital with the explicit purpose of acquiring a private existing business and taking it public, sidestepping the traditional initial public offering (IPO) process.

Many of the renewable SPACs that are currently publicly filed with the SEC have raised about $250 million or more. They are looking to buy privately-held companies that produce batteries for renewable energy storage, hydrogen storage solutions, carbon storage, and even some drilling for natural gas, a lower-carbon fossil fuel, according to SEC documents reviewed by Reuters.

For example, Peridot Acquisition Corp, a renewable SPAC, closed on its acquisition of Li-Cycle, a lithium-ion battery recycler, on Aug. 10. Peridot has formed a second SPAC aimed at acquiring additional renewable companies.

Other SPACs, such as GoGreen Investments Corp, are nearing deals with targets, the advisors said, speaking on a condition of anonymity as the talks are not public.

Alternative energy SPACs that have publicly formed have come together under increasing pressure from investors who want to shift into renewables.

“Their limited partners are telling them that they don’t want them to look into traditional energy,” said Mike Blankenship, a partner in the Houston office of law firm Winston & Strawn. “They are creating SPACs to get a percentage of these companies and then a board seat in these companies.”

John Dowd, a former top energy portfolio manager for Fidelity, serves as chief executive for GoGreen Investment, a proposed $250 million SPAC that filed its S-1 this summer, with plans to target a wide variety of “energy transition” companies from hydrogen storage to software solutions.

Leadership and boards of the new renewable SPACs often include executives, bankers and portfolio managers who previously specialized in oil, gas and conventional utilities, according to SEC filings.

Beyond Peridot, a handful of renewable SPACs have already taken their targets public, including Chargepoint. Bill Gates-backed Heliogen Inc plans to go public through a $2 billion SPAC deal with Athena Technology Acquisition Corp.

However, few privately-held renewable companies are large enough to be ideal targets for SPACs, said Blankenship. Generally, companies need to be valued at over $1 billion to attract attention for a $250 million SPAC, Ritter said.

Because the industry is changing so rapidly, there are many start-ups that are not obvious targets, Blankenship said.

SPACs are also facing additional regulatory scrutiny. Last month, Reuters reported that U.S. securities regulators ramped up its inquiry on Wall Street’s SPAC frenzy, homing in on potential conflicts of interest and deal structures that may spur underwriters to create unsuitable deals.

For a look at all of today’s economic events, check out our economic calendar.

(Reporting By Jessica Resnick-Ault; Editing by Marguerita Choy)

Source link

0 0 votes
Article Rating

Notifier de
0 Commentaires
Commentaires en ligne
Afficher tous les commentaires
Reset Password

Avertissement sur les risques :

Le trading peut vous exposer à des risques de pertes supérieures aux dépôts et ne convient qu’à une clientèle avisée ayant les moyens financiers de supporter un tel risque. Les CFD sont des instruments complexes et présentent un risque élevé de perte rapide en capital en raison de l’effet de levier. Entre 74 et 89% des comptes de clients de détail perdent de l’argent lors de la négociation de CFD. Vous devez vous assurer que vous comprenez comment les CFD fonctionnent et que vous pouvez vous permettre de prendre le risque élevé de perdre votre argent. Ce site n’est en aucun cas une offre de conseil en investissement ni une incitation quelconque à acheter ou vendre des instruments financiers. Trader le Forex et/ou les CFD’s implique un niveau de risque élevé, et peut ne pas être approprié car vous pouvez subir des pertes supérieures à votre dépôt. L’effet de levier peut être en votre défaveur.

Vous devez être conscient et avoir une compréhension complète de tous les risques associés au marché et au trading. Le site peut être amené à produire des commentaires d’ordre général, ce qui ne constitue pas des conseils en investissement et ne doit pas être interprété comme tel.

Veuillez recourir aux conseils d’un conseiller financier extérieur. Le site décline toute responsabilité pour les erreurs, inexactitudes ou omissions et ne garantit pas l’exactitude ou le caractère complet des informations, textes, graphiques, liens ou autres éléments contenus dans cette documentation. Toute information et toute mise à disposition sur le site ont un caractère privé.