Star Peak Energy Transition (NYSE:STPK) is yet another blank-check company shooting for the stars this morning. In fact, STPK stock is up nearly 40% after the special purpose acquisition company announced it will take Stem public. So what do you need to know about the Stem SPAC merger? And what else is appealing about STPK stock?
To start, what exactly is the big news today? Well, Star Peak Energy Acquisition announced it will bring energy storage specialist Stem to the public markets. Investors seem to be celebrating the fact Stem is a leader in all things clean energy, tying it to recent trends.
With that in mind, here are 13 things to know about the Stem SPAC merger and STPK stock:
- Star Peak Energy Transition first came public in August 2020.
- At the time, it raised $350 million by selling 35 million units at $10 each.
- Additionally, the blank-check company said it wanted to focus on acquiring businesses aiming to improve energy ecosystems and reduce emissions.
- That is where the big announcement on Friday comes in.
- This morning, Star Peak announced it will acquire Stem, which has been around since 2009.
- Stem focuses on battery storage systems, network integration and battery optimization.
- Importantly, it uses an artificial intelligence platform called Athena for its energy storage solutions.
- How does this work? Well, Athena uses AI to forecast energy demand. This system works to optimize batteries and ultimately lower energy costs.
- The transaction will result in $608 million in gross proceeds, including from institutional investors.
- These investors include big names like BlackRock (NYSE:BLK) and Van Eck.
- Importantly, the deal is supposed to close in the first quarter of 2021.
- The combined company will have a value of close to $1.35 billion.
- Lastly, Stem will start trading on the New York Stock Exchange under the symbol STEM.
Why STPK Stock and the Stem SPAC Merger Matter
The story here is simple. To start, all things new to the public markets have attracted investors in 2020. This comes after the novel coronavirus massively disrupted initial public offerings and reintroduced special purpose acquisition companies to the public conscious. Now, we continue to see these SPAC mergers captivate attention and shoot higher. In fact, this morning we have watched CIIG Merger (NASDAQ:CIIC) and Collective Growth (NASDAQ:CGRO) rally because of SPAC merger news.
Additionally though, Star Peak and STPK stock now represent what investors really want. In recent months, clean energy stocks have been red hot. This includes electric vehicles, charging companies and even next-gen battery plays. Stem perfectly ties into this narrative, making the news even more appealing on Friday.
Lastly, with the upcoming inauguration of President-elect Joe Biden, even more attention is on this space. That is because Biden has promised to invest $2 trillion in clean energy initiatives.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer for InvestorPlace.com.