California lithium and power developer Controlled Thermal Resources will go public on the Nasdaq through a $4.7 billion merger with blank-check firm Plum Acquisition Corp IV, the companies said on Monday.
The listing has been CTR’s goal since at least 2021 and is part of a plan to attract investment from U.S. President Donald Trump’s administration.
The deal will bring in $300 million for CTR, funds that will be used to develop its Hell’s Kitchen lithium and geothermal power project, located in the Salton Sea region, roughly 160 miles (258 km) southeast of Los Angeles.
Deals by special purpose acquisition companies (SPAC) have bounced back on Wall Street after years of muted activity, with companies turning to the alternative route to list. SPACs are shell firms that raise money through an IPO to merge with a private business and take it public.
The deal is expected to close in the second half and the combined company is expected to be listed on the Nasdaq under the ticker symbol “CTRH.”
CTR plans to extract superhot brines from deep beneath the Salton Sea and use the heat to generate steam for electricity production. Lithium will then be extracted from the brine before being reinjected back underground using so-far unproven direct lithium extraction technology.
CTR plans to use that technology developed by privately held Aquatech, which counts private equity firm Cerberus as a minority investor.
CTR’s project, which was added to a fast-track permitting list by the Trump administration, is expected to produce 50 megawatts of power by 2028 and 25,000 metric tons per year of lithium by 2029.
Energy-intensive data centers, which are vital physical infrastructure for artificial intelligence, are driving U.S. power demand to record highs.
CTR aims to also produce zinc, manganese and potash from the Salton Sea brine.
“We have focused on diversification. We wanted to get away from just lithium,” CEO Rod Colwell told Reuters. Colwell and his family will remain the company’s largest shareholders once the listing is complete.
CTR signed lithium supply deals with General Motors and Stellantis several years ago. Those remain in place, but the volumes for the contracts may change, Colwell said, although he declined to provide details.
CTR’s faced a lawsuit from Earthworks over concerns about water use. A state court ruled last year against the environmental group, which is appealing.
Hall Chadwick advised CTR while Cohen & Company Capital Markets was Plum IV’s adviser.
Source: Reuters.com