Archaea Energy, which combined with Rice Acquisition Corp. in September 2021, announced that it has agreed to be acquired by BP (NYSE:BP) for $26 per share.
The price is a 38% premium to Archaea’s 30-day VWAP and represents a major victory for a de-SPAC at time when the market has been rather short on good SPAC news. Rice initially struck its combination with Archaea at an enterprise value of $1.15 billion in April 2021 and now 18 months after the announcement, Archaea has more than tripled this valuation to $4.1 billion in the sale.
The original business combination was also somewhat unique in that it was a three-way merger between Aria Energy and Archaea, the former of which was larger, and the latter was a portfolio company of Rice’s sponsor, Rice Investment Group.
Archaea produces renewable natural gas captured from waste emissions out of farms and landfills, and, as such, in some ways cuts the profile of a new technology player at a time when the market has scrutinized such companies. But, it was also fully commercialized and profitable before launching its SPAC deal.
It generated $76.1 million in EBITDA in 2021 and has further benefitted from world events that have accelerated momentum towards energy resources that are renewable and not coming from Russia.
From BP’s point of view, Archaea will add more clean energy resources to its portfolio and by the same token reduce the weight of the dirtier sides of its operations. That could potentially be a strategy that other strategic players could employ with several renewable energy de-SPACs seemingly undervalued by market conditions.
Terms Tracker for the Week Ending September 13, 2024 Welcome to our weekly column where we discuss the findings from our IPO terms tracker based on the previous week’s pricings. We were expecting this week to be busier than it was since it was the first 5-day week post-Summer. However, it was actually very light....
Alpha Star (NASDAQ:ALSA) has entered into a definitive agreement to combine with fintech firm XDATA at an equity value of $180 million. Tallinn, Estonia-based XData provides payment software and digital banking systems for business clients. The combined company is expected to trade on the Nasdaq once the deal is completed in late 2024. Transaction Overview...
At the SPAC of Dawn The market shifted this week on the see-saw of the US election prospects, but, beyond the policies at play, another impact the election could have on the SPAC market is the potential for a fair amount of people movement. Many of the biggest names in SPACland have been bundling donations...
At the SPAC of Dawn After what appeared to a pause in activity around the presidential debate, Southport (OTC:PORT) and Future Vision II (NASDAQ:FVNNU) broke the seal yesterday on both new business combinations and IPOs, respectively. Two SPACs are about to come off of the board as well, however, as 99 Acquisition Group (NASDAQ:NNAG) has...
Future Vision II Acquisition Corp. announced the pricing of its $50 million IPO and its units are expected to begin trading on the Nasdaq under the symbol “FVNNU”, Friday, September 12, 2024. The new SPAC intends to focus its search on businesses within the technology, media, and telecommunications sector. Future Vision II’s sponsor team is...