ClimateRock, a special purpose acquisition (SPAC) and investment firm, and Eco Energy World (EEW), an independent global developer of utility-scale solar photovoltaic (PV) projects, announced the signing of a definitive business combination agreement to form a new holding company Pubco.

The new entity Pubco will acquire both EEW and ClimateRock to become a publicly traded entity under a new company name. The transaction would raise EEW to an equity value of $650 million.

EEW operates a portfolio of 1.5 GW solar PV projects across Europe, the United Kingdom, and Australia and specializes in building these projects from greenfield to ready-to-build stage worldwide.

EEW also has a stronghold of blue-chip institutional and industrial relationships in the renewable energy market.

Under the agreement, EEW’s shareholders will receive Pubco’s shares in exchange for EEW shares and are expected to hold around 80-85% of outstanding shares in the new entity.

Pubco is expected to be listed on the Nasdaq stock market and will be led by Svante Kumlin, EEW’s founder and Chief Executive Officer.

Svante Kumlin said, “We have been aggressively implementing our growth strategy, and through this business combination, we believe we will be well-positioned to continue executing our business plan. Together EEW and the ClimateRock management team members have a solid track record of creating value and driving growth in the renewable energy sector.”

The new company will also have two individuals from ClimateRock joining the board of directors.

ClimateRock, a SPAC or blank check company, is incorporated as a Cayman Islands-exempted company for mergers and asset acquisitions. The company closed $75 million in an initial public offering in May 2022.

ClimateRock’s CEO Per Regnarsson, commented, “In connection with our initial public offering, we made a commitment to be a trusted acquirer of and investor in the sustainable energy industry.  With today’s business combination announcement, we believe that EEW is the ideal partner with which we can fulfill this commitment.”

The closing of the business combination is incumbent upon $40 million of cash being available, after any ClimateRock shareholder redemptions and payment of transaction expenses, from ClimateRock’s trust account or additional equity or debt financing to be obtained before closing.

According to Mercom Capital’s 1H and Q2 2022 Solar Funding and M&A Report, there were a total of 148 project acquisitions for 38 GW of solar projects in 1H 2022, compared to 136 project acquisitions totaling 40 GW in 1H 2021.

In March this year, the European Commission proposed the REPowerEU plan to promote renewable energy installations, including solar, across the member states to help cut the dependency on Russian fossil fuels.