The Iraqi federal government is…
Armenian Prime Minister Pashinyan and…
As blank-check SPAC mergers attempt a comeback after a volatile year, solar outfit Sunergy Renewables has announced plans to go public and list on the NASDAQ in a $475-million deal that is expected to close in the fourth quarter of this year.
The black-check merger with ESGEN Acquisition Corp (ESAC.O) is intended to help Sunergy expand its solar power, battery power and energy storage business which is currently operating in Florida, Texas and Arkansas.
“Proceeds to provide growth capital to Sunergy for expansion of customer offerings and general corporate purposes. Sunergy also plans to consider strategic acquisitions of attractive targets to fuel growth and consolidate smaller companies in the heavily fragmented residential solar industry,” the company said in a press release.
SPAC (special purpose acquisition company) mergers are intended to help offset market volatility because they are structured as trust units with a value of $10 per share. They have two years to complete an acquisition before they must return funding to investors. Over the past year, there have been a number of SPAC deals that failed to merger as a result of high inflation and rising interest rates.
The timing of the deal reflects strong headwinds for solar energy in the U.S., boosted by favorable government policy and a heightened sense of urgency to address climate change and energy security simultaneously.
Regulatory support has been particularly strong in sunny states, including those in which Sunergy operates.
Between 2021 and 2022, the rooftop solar market in the U.S. saw ~30% growth, according to a February 2023 report from Morningstar, which notes that growth was promoted by significant consumer incentives, including 0% loans for rooftop solar installations in some states. However, since then, the market has somewhat reversed, with the Biden administration’s Inflation Reduction Act (IRA) hoping to reinvigorate it with a 30% federal tax credit for solar installation until 2032.
By Charles Kennedy for Oilprice.com
More Top Reads From Oilprice.com:
Charles is a writer for Oilprice.com