Bloom Energy Sees Promise in SK ecoplant Deal
Posted on 10/25/2021
SK ecoplant Co., Ltd., part of the SK Group, is buying 10,000,000 shares of zero coupon, non-voting redeemable convertible Series A preferred stock, par value $0.0001 per share in Bloom Energy Corporation as part of a strategic agreement. The purchase price is US$ 25.50 per share or an aggregate purchase price of approximately US$ 255 million. The deal was revealed on October 23, 2021. The partnership includes purchasing a minimum of 500 megawatts (MW) from Bloom Energy, representing a US$ 4.5 billion revenue commitment; co-creating two hydrogen innovation centers; and targeting an equity investment of approximately US$ 500 million. Bloom Energy is SK ecoplant’s largest strategic partner in clean energy. Bloom Energy and SK ecoplant agreed to create Hydrogen Innovation Centers in the United States and South Korea. The intent is to significantly accelerate the global market expansion for Bloom Energy’s hydrogen fuel cell and hydrogen electrolyzer products.
On September 23, 2019, Bloom Energy entered into a joint venture agreement with SK ecoplant, to establish a facility in South Korea for the procurement of local parts for the Bloom Energy Server and for assembly of certain portions of the Bloom Energy Server for the South Korean market. As part of the expanded strategic partnership, the parties have agreed to increase the scope of the assembly work done in the joint venture facility.
SK ecoplant to Invest Approximately $500 Million in Bloom Energy
SK ecoplant will invest $255 million in Bloom Energy by acquiring 10 million shares of zero coupon, non-voting redeemable convertible preferred stock at a price of $25.50 per share. SK ecoplant has the option to acquire a minimum of an additional 11 million shares of Class A common stock at a 15 percent premium to the prevailing stock price at the time, which must be no later than November 30, 2023 and is subject to a maximum ownership of 15 percent.
Upon completion of SK ecoplant’s purchase of its second tranche, SK ecoplant will add a member to the Bloom Energy Board of Directors. SK will give an irrevocable proxy to vote its shares to Bloom Energy.
Advisors
Centerview Partners LLC is serving as financial advisor to Bloom Energy.
