- Stem, Inc. to become publicly listed through business
combination with Star Peak Energy Transition Corp. (NYSE:
STPK).
- Founded in 2009, Stem is an energy storage leader that offers
customers a complete solution of integrated battery storage
systems, network integration and battery optimization via its
proprietary AI-driven software platform called Athena™.
- Stem delivers significant customer value by lowering energy
costs, stabilizing the grid, alleviating intermittency and reducing
carbon emissions – addressing electric grid constraints and driving
the rapid global transition to zero carbon, renewable
generation.
- Transaction to provide up to $608 million in gross proceeds,
comprised of Star Peak’s $383 million of cash held in trust,
assuming no redemptions, and a $225 million fully-committed common
stock PIPE at $10.00 per share, including investments from funds
and accounts managed by BlackRock, Van Eck Associates Corporation,
Adage Capital Management, L.P., Electron Capital Partners, and
Senator Investment Group.
- Following the expected first quarter 2021 transaction close,
the combined company will have an estimated equity value of
approximately $1.35 billion and will remain listed on the New York
Stock Exchange under the new ticker symbol “STEM.”
- All Stem shareholders will roll 100% of their equity holdings
into the new public company.
- Transaction positions Stem to capitalize on significant growth
opportunities, expand globally and continue to advance its Athena™
software platform.
- Stem’s energy storage systems address a $1.2 trillion market
opportunity, and offers investors a unique ESG opportunity to
invest in a pure play clean energy company helping to revolutionize
the electric grid.
Stem, Inc., (“Stem” or “the Company”), a global leader in
artificial intelligence (AI)-driven clean energy storage systems,
and Star Peak Energy Transition Corp. (“Star Peak”) (NYSE: STPK), a
publicly-traded special purpose acquisition company, announced
today a definitive agreement for a business combination that will
result in Stem becoming a public company. Upon closing of the
transaction, the combined company will be named Stem and remain
listed on the New York Stock Exchange under the new ticker symbol
“STEM.” The combined company will be led by John Carrington, Chief
Executive Officer of Stem.
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the full release here:
https://www.businesswire.com/news/home/20201204005244/en/
Founded in 2009, Stem is an industry leading provider of
AI-driven energy storage systems and market leader in the clean
energy ecosystem. The Company generates revenue by providing
customers with integrated energy storage systems, long-term
recurring software services and energy market participation through
its proprietary software platform, called Athena™, which enables
AI-automated system operations. The Company empowers its customers
and partners to optimize energy usage by automatically switching
between battery power, onsite generation and grid power. Its
storage solutions address a $1.2 trillion opportunity for leading
fortune 500 companies, commercial and industrial customers,
independent power producers and renewable asset owners, among
others.
Stem’s smart energy storage technology solves many of the
challenges facing today’s dynamic power market and is well
positioned to manage the increasing decentralization and
democratization of the electric grid, significantly accelerating
renewable growth and virtual power plants. Stem’s network of energy
storage systems supports utilities in reducing the dependency on
conventional power sources. The network helps alleviate grid
intermittency issues and promotes the adoption of renewable energy
generation as a replacement for fossil fuels while supporting
customers in meeting their ESG goals.
Management Commentary:
John Carrington, Chief Executive Officer of Stem, commented,
“This transaction is transformative for us and we expect it to
significantly accelerate our growth. Stem is a market leader and
our Athena™ software platform is proven in the U.S., Japan and
Canadian markets, and this merger will enable expansion to several
additional global markets. Our systems deliver value to our
customers by lowering energy costs, enhancing renewable returns,
and meeting ESG and sustainability goals, while increasing grid
reliability. We are excited to partner with the Star Peak team and
share a collective vision. The balance sheet strength of the
combined company will empower Stem to expand its technological
leadership and geographic reach. We look forward to creating
long-term value for our customers, employees and shareholders as a
public company.”
Mike Morgan, Chairman of Star Peak who will join Stem’s Board of
Directors, said, “Stem is a leader in one of the fastest growing
markets in clean energy and the first pure play smart energy
storage company to go public. Stem and its highly experienced
management team perfectly align with Star Peak’s mission to provide
growth capital to a market-leading business focused on climate
change initiatives, emissions reductions and energy efficiency. In
support of global decarbonization objectives, the entire power grid
is being decentralized and democratized. We believe Stem is at the
epicenter of this clean energy transition and its AI-driven
software systems will be critical in accelerating renewables
adoption and addressing climate change.”
Eric Scheyer, Chief Executive Officer of Star Peak, commented,
“Stem is an exceptional investment opportunity. We completed an
extensive due diligence process and view Stem as a market leader in
one of the most exciting segments of the clean energy ecosystem.
The Star Peak team has significant experience investing in the
broader energy infrastructure, renewables and technology sectors,
and we believe Stem represents a highly compelling opportunity to
capitalize on the scarcity of high-quality, public clean energy
companies with attractive ESG characteristics, significant scale
and visible growth.”
Stem Investment Highlights:
- Large addressable market and strong macroeconomic
tailwinds – the global energy storage market is expected to
increase approximately 25-fold by 2030, driven by the convergence
of two technologies (i) low-cost renewable generation and (ii)
rapid reduction in battery costs and improving efficiency. The
energy storage market is expected to grow materially faster than
solar and wind generation.
- Market and technology leader:
- More than 600 MWh of storage capacity commissioned since
2014.
- Over 900 systems operating or contracted with Stem’s
proprietary Athena™ software platform, in more than 200 cities and
representing approximately 1 GWh of storage capacity.
- 75% market share in the California commercial and industrial
storage market, the largest energy storage market in the U.S.
- First mover AI software platform has operated globally with
over 40 utilities and 16 million runtime hours across its customer
base.
- Balance sheet supports significant market expansion –
strong balance sheet with approximately $525 million of cash to
fully finance all U.S. and international forecasted growth.
- Highly visible growth – strong backlog and long-dated
recurring software revenue streams enhance near-term revenue
visibility.
- Capital light business model – AthenaTM AI-driven
software leads to strong operating leverage with low expected
capital intensity.
- Pure play clean energy company with attractive ESG
characteristics – Stem facilitates rapid adoption of renewables
and supports customer sustainability goals.
Transaction Overview
The business combination values the combined company at a $1.35
billion pro forma equity value, at a price of $10.00 per Star Peak
share and assuming no redemptions by Star Peak shareholders. The
transaction will provide $608 million of gross proceeds to the
company, assuming no redemptions, including a $225 million fully
committed common stock PIPE at $10.00 per share anchored by
existing and new investors, including funds and accounts managed by
BlackRock, Van Eck Associates Corporation, Adage Capital
Management, L.P., Electron Capital Partners, and Senator Investment
Group.
The Boards of Directors of each of Stem and Star Peak have
unanimously approved the transaction. The transaction will require
the approval of the stockholders of both Stem and Star Peak, and is
subject to other customary closing conditions, including the
receipt of certain regulatory approvals. The transaction is
expected to close in the first quarter of 2021. All Stem
shareholders will roll 100% of their equity holdings into the new
public company.
Additional information about the proposed transaction, including
a copy of the merger agreement and investor presentation, will be
provided in a Current Report on Form 8-K to be filed by Star Peak
with the Securities and Exchange Commission and will be available
on the Stem investor relations page at www.stem.com/investors and at www.sec.gov.
Advisors
Goldman Sachs & Co. LLC is serving as exclusive financial
advisor to Star Peak. Goldman Sachs & Co. LLC and Credit Suisse
Securities (USA) LLC are serving as joint capital markets advisors
to Star Peak and serving as co-placement agents on the PIPE
offering. Kirkland & Ellis LLP is serving as legal advisor to
Star Peak. Morgan Stanley & Co. LLC is serving as lead
financial advisor to Stem, Nomura Greentech is serving as a
financial advisor to Stem, and Gibson, Dunn & Crutcher LLP as
well as Wilson, Sonsini, Goodrich & Rosati are serving as legal
advisors to Stem.
Investor Conference Call Information
Star Peak and Stem will host a joint investor conference call to
discuss the proposed transaction Friday, December 4, 2020 at 8:30am
ET.
Interested parties may listen to the prepared remarks call via
telephone by dialing 877-407-0784, or for international callers,
201-689-8560. A telephone replay will be available until December
18, 2020 by dialing 844-512-2921, or for international callers,
412-317-6671 and entering the passcode 13713852.
About Stem
Stem provides solutions that address the challenges of today’s
dynamic energy market. By combining advanced energy storage
solutions with Athena™, a world-class artificial intelligence
(AI)-powered analytics platform, Stem enables customers and
partners to optimize energy use by automatically switching between
battery power, onsite generation and grid power. Stem’s solutions
help enterprise customers benefit from a clean, adaptive energy
infrastructure and achieve a wide variety of goals, including
expense reduction, resilience, sustainability, environmental and
corporate responsibility and innovation. Stem also offers full
support for solar partners interested in adding storage to
standalone, community or commercial solar projects – both behind
and in front of the meter.
Headquartered in Millbrae, Calif., Stem is directly funded by a
consortium of leading investors including Activate Capital,
Angeleno Group, BNP Paribas, Constellation Technology Ventures,
Copec, Iberdrola (Inversiones Financieras Perseo), GE Ventures,
Magnesium Capital, Mithril Capital Management, Mitsui & Co.
LTD., Ontario Teachers’ Pension Plan, RWE Supply & Trading,
Temasek and Total Energy Ventures. For more information, visit
www.stem.com.
About Star Peak Energy Transition Corp.
Star Peak is a blank check company incorporated in Delaware for
the purpose of effecting a merger, capital stock exchange, asset
acquisition, share purchase, reorganization or similar business
combination with one or more businesses. Star Peak is led by a
management team with extensive experience investing in the energy,
energy infrastructure and renewables sectors, including Chairman,
Michael Morgan and Chief Executive Officer, Eric Scheyer. Michael
Morgan is Chairman and Chief Executive Officer at Triangle Peak
Partners LP and currently serves as a director of Sunnova Energy
International (NYSE: NOVA) and lead director of Kinder Morgan, Inc.
(NYSE: KMI), one of the largest energy infrastructure companies in
North America, a company he joined at its founding in 1997. Eric
Scheyer is a Partner at Magnetar and has served as the Head of the
Magnetar Energy and Infrastructure Group since its inception in
2005. For more information, visit www.starpeakcorp.com.
Forward-Looking Statements
Certain statements in this press release may be considered
“forward-looking statements” within the meaning of the “safe
harbor” provisions of the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements generally
relate to future events of Star Peak or Stem’s future financial or
operating performance. For example, projections of future revenue
and other metrics are forward-looking statements. In some cases,
you can identify forward-looking statements by terminology such as
“may,” “should,” “expect,” “intend,” “will,” “estimate,”
“anticipate,” “believe,” “predict,” “or“ or the negatives of these
terms or variations of them or similar terminology. Such
forward-looking statements are subject to risks, uncertainties, and
other factors which could cause actual results to differ materially
from those expressed or implied by such forward-looking statements.
These forward-looking statements are based upon estimates and
assumptions that, while considered reasonable by Star Peak and its
management, and Stem and its management, as the case may be, are
inherently uncertain factors that may cause actual results to
differ materially from current expectations include, but are not
limited to: 1) the occurrence of any event, change or other
circumstances that could give rise to the termination of the
definitive merger agreement with respect to the business
combination; 2) the outcome of any legal proceedings that may be
instituted against Star Peak, the combined company or others
following the announcement of the business combination and any
definitive agreements with respect thereto; 3) the inability to
complete the business combination due to the failure to obtain
approval of the stockholders of Star Peak, to obtain financing to
complete the business combination or to satisfy other conditions to
closing; 4) changes to the proposed structure of the business
combination that may be required or appropriate as a result of
applicable laws or regulations or as a condition to obtaining
regulatory approval of the business combination; 5) the ability to
meet the NYSE’s listing standards following the consummation of the
business combination; 6) the risk that the business combination
disrupts current plans and operations of Stem as a result of the
announcement and consummation of the business combination; 7) the
ability to recognize the anticipated benefits of the business
combination, which may be affected by, among other things,
competition, the ability of the combined company to grow and manage
growth profitably, maintain relationships with customers and
suppliers and retain its management and key employees; 8) costs
related to the business combination; 9) changes in applicable laws
or regulations; 10) the possibility that Stem or the combined
company may be adversely affected by other economic, business
and/or competitive factors; 11) Stem’s estimates of its financial
performance; 12) the impact of the novel coronavirus disease
pandemic and its effect on business and financial conditions; and
13) other risks and uncertainties set forth in the section entitled
“Risk Factors” and “Cautionary Note Regarding Forward-Looking
Statements” in Star Peak’s Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 2020. Nothing in this press
release should be regarded as a representation by any person that
the forward-looking statements set forth herein will be achieved or
that any of the contemplated results of such forward looking
statements will be achieved. You should not place undue reliance on
forward-looking statements, which speak only as of the date they
are made. Neither Stark Peak nor Stem undertakes any duty to update
these forward-looking statements, except as otherwise required by
law.
Important Information for Investors and Stockholders
In connection with the proposed transaction, Star Peak will file
a registration statement on Form S-4 (the “Registration Statement”)
with the SEC, which will include a preliminary proxy statement to
be distributed to holders of Star Peak’s common stock in connection
with Star Peak’s solicitation of proxies for the vote by Star
Peak’s stockholders with respect to the proposed transaction and
other matters as described in the Registration Statement, as well
as the prospectus relating to the offer of securities to be issued
to Stem’s stockholders in connection with the proposed transaction.
After the Registration Statement has been filed and declared
effective, Star Peak will mail a definitive proxy statement, when
available, to its stockholders. Investors and security holders
and other interested parties are urged to read the proxy
statement/prospectus, any amendments thereto and any other
documents filed with the SEC carefully and in their entirety when
they become available because they will contain important
information about Star Peak, Stem and the proposed transaction.
Investors and security holders may obtain free copies of the
preliminary proxy statement/prospectus and definitive proxy
statement/prospectus (when available) and other documents filed
with the SEC by Star Peak through the website maintained by the SEC
at http://www.sec.gov, or by directing a request to: Star Peak
Energy Transition Corp., 1603 Orrington Ave., 13 Floor, Evanston,
IL 60201. The information contained on, or that may be accessed
through, the websites referenced in this press release is not
incorporated by reference into, and is not a part of, this press
release.
Use of Projections
This press release contains financial forecasts of Stem. Neither
Stem’s independent auditors, nor the independent registered public
accounting firm of Star Peak, audited, reviewed, compiled or
performed any procedures with respect to the projections for the
purpose of their inclusion in this press release, and accordingly,
neither of them expressed an opinion or provided any other form of
assurance with respect thereto for the purpose of this press
release. These projections should not be relied upon as being
necessarily indicative of future results. The projected financial
information contained in this press release constitutes
forward-looking information. The assumptions and estimates
underlying such projected financial information are inherently
uncertain and are subject to a wide variety of significant
business, economic, competitive and other risks and uncertainties
that could cause actual results to differ materially from those
contained in the prospective financial information. See
“Forward-Looking Statements” above. Actual results may differ
materially from the results contemplated by the projected financial
information contained in this press release, and the inclusion of
such information in this press release should not be regarded as a
representation by any person that the results reflected in such
projections will be achieved.
Participants in the Solicitation
Star Peak and its directors and officers may be deemed
participants in the solicitation of proxies of Star Peak’s
shareholders in connection with the proposed business combination.
Security holders may obtain more detailed information regarding the
names, affiliations and interests of certain of Star Peak’s
executive officers and directors in the solicitation by reading
Star Peak’s final prospectus filed with the SEC on August 19, 2020,
the registration statement / proxy statement and other relevant
materials filed with the SEC in connection with the business
combination when they become available. Information concerning the
interests of Star Peak’s participants in the solicitation, which
may, in some cases, be different than those of their stockholders
generally, will be set forth in the registration statement / proxy
statement relating to the business combination when it becomes
available.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201204005244/en/
Investor – Stem Marc Silverberg, ICR, Inc.
stemIR@icrinc.com
Media Contact – Stem Cory Ziskind, ICR, Inc.
stemPR@icrinc.com
Star Peak Tricia Quinn Courtney Kozel
info@starpeakcorp.com 847 905 4400
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