The Five Worst SPAC Deals Still Above $5
The Five Worst SPAC Deals Still Above $5
The Bear Cave sifted through hundreds of SPAC mergers to find the worst ones still trading above $5. Here’s what we uncovered:
1/ Energy Vault Holdings ($6.57 share price, NYSE: NRGV — $879 million) describes itself as “a leader in sustainable, grid-scale energy storage solutions.” The company plans to build gravity-based energy storage towers that lift concrete blocks into a tower formation during times of energy surplus and release energy by lowering the blocks during times of energy shortage. The company projects $1.4 billion in revenue by 2024 and has announced a variety of partnerships. Investors should be skeptical.
For one, Energy Vault’s technology has been repeatedly debunked. CleanTechnica called the concept “so obviously flawed” and one viral video titled, “Energy Vault: MEGA-BUSTED!” said the company uses “Theranos style optimistic timelines and goals” and is “dumb beyond words.” The top comment reads,
“Holy market capitalization Batman! I had no idea they were a listed company. I thought they'd just wither away and die a quick death. Now this boondoggle is going to drag on for years!”
Another area of concern is the company’s partnerships.
In October 2021, Energy Vault announced an energy storage project with DG Fuels that would “provide up to $520 million in revenue.” More recently, Energy Vault is being sued for misleading investors about the partnership because “DG Fuels has no revenue and has nothing in operation at present.”
The Energy Vault representative cited on the partnership press release is Energy Vault’s Chief Marketing Officer, Laurence Alexander. Mr. Alexander appears to have previously been a promoter of the cryptocurrency DasCoin, which has fallen over 90% and currently trades for less than two cents.
Energy Vault also has a partnership with Palantir Technologies, which agreed to invest $8.5 million in the PIPE. After the SEC pushed for more disclosure around the Palantir investment, Energy Vault published a $7.5 million contract it signed with Palantir for its “Foundry Cloud Subscription.”
Energy Vault also announced that it “separated” from its CFO in April 2022 after about one year. The company’s co-founder and director, Bill Gross of Idealab, is also the CEO and Chairman of solar company Heliogen Inc (NYSE: HLGN). That company is down ~80% since its December 2021 SPAC merger.
2/ Fisker Inc ($10.00 share price, NYSE: FSR — $2.97 billion) is a California-based electric vehicle company led by Henrik Fisker. The company’s predecessor, Fisker Automotive, declared bankruptcy in 2013. Now, despite “no commercial operations and limited revenues derived from merchandise sales” the company has disclosed a material weakness in financial reporting, dismissed its auditor, and employs the CEO’s wife, Dr. Geeta Gupta-Fisker, as CFO. Let’s dig in.