Bill Gates-Backed Solar Company Heliogen Lands SPAC Deal: What Investors Should Know

A company that uses concentrated sunlight to provide low-cost solar energy announced a SPAC deal Wednesday.

The SPAC Deal: Heliogen announced a merger with Athena Technology Acquisition Corp ATHN valuing the company at an enterprise value of $2 billion.

A PIPE of $165 million includes investments from Morgan Stanley, Saba Capital and the XCarb Innovation Fund of ArcelorMittal SA MT.

The SPAC is led by Bill Gross, the founder and CEO of idealab, which made over 150 company investments.

Public ATHN shareholders will own 10.6% of the company after the merger. The company will trade as HLGN on the NYSE after the merger is complete.

Among the investors in Heliogen is Microsoft Corporation MSFT founder Bill Gates.

“I’m pleased to have been an early backer of Bill Gross’s novel solar concentration technology. Its capacity to achieve the high temperatures required for these processes is a promising development in the quest to one day replace fossil fuel,” Gates said.

About Heliogen: A closed loop, artificial intelligence-enabled technology from Heliogen is working on commercialization efforts with customers in the industrial, mining and energy sectors.

Heliogen’s technology has the potential to revolutionize the energy market according to the company. The company’s technology flattens the power generation curve using concentrated solar power.

A proprietary heliosat layout has the ability to help increase solar output and produce green hydrogen fuel. The company’s goal is to provide near-24 hour renewable energy to replace fossil fuels.

Strategic partners include ArcelorMittal, Rio Tinto RIO and an unnamed global oil and gas producer in Australia.

Related Link: Sunlight Financial Strikes Deal With Apollo SPAC, Chamath Palihapitiya PIPE

Growth Ahead: The proceeds from the transaction will help the company expand its operations by scaling its manufacturing and increasing research and development for new technology.

Heliogen has a modular and scalable model that it said can help grow the business.

The company has six patents and 13 pending, which could add licensing revenue down the road. Further growth could come from additional government subsidies for the solar sector, which the company said is not priced into its financial projections past the current investment tax credit.

Financials: Heliogen projects revenue of $8 million in fiscal 2021 and $24 million in fiscal 2022. The company’s business is projected to scale over the next several years with triple-digit revenue growth projected for the next four years.

The company lists projections of $569 million for fiscal 2024 and $1.41 billion in fiscal 2025. A positive EBITDA of $287 million is projected for fiscal 2025.

Price Action: ATHN shares are up 3% to $10 on Wednesday.