Zinc battery firm Eos agrees US$315 million facility with Cerberus Capital, retires existing senior loan
Eos agrees $305m facility with Cerberus, retires senior loan
US zinc hybrid cathode battery storage manufacturer Eos Energy Enterprises has agreed a financing package with private equity firm Cerberus, comprised of separate loan and revolver facilities totalling US$315 million.
The financing from an affiliate of Cerberus Capital Management comprises a US$210.5 million delayed draw term loan partially dependent on achieving operational milestones, and a US$105 million revolver that Eos can draw upon at Cerberus’ discretion.
Enjoy 12 months of exclusive analysis
- Regular insight and analysis of the industry’s biggest developments
- In-depth interviews with the industry’s leading figures
- Annual digital subscription to the PV Tech Power journal
- Discounts on Solar Media’s portfolio of events, in-person and virtual
Or continue reading this article for free
Eos said the funding will support its plan to scale operations and execute on its path to profitability, with losses narrowing in recent quarters. It manufactures a proprietary zinc-based battery which it sells to system integrators for projects with up to 12 hours of required discharge duration.
The company will use the proceeds to retire its existing $100 million senior secured term loan on favourable terms, which it said will strengthen its balance sheet. It said it has reached an agreement to extinguish that debt for US$27 million, of which US$20 million has been paid with the remaining US$7 million payable over the next 12 months.
Eos CFO Nathan Kroeker said: “The strategic investment announced today, combined with Eos’ highly efficient manufacturing capacity model, supports our capital needs as we execute on Project AMAZE. We look forward to working with Cerberus and their strong network to continue driving down product costs, improving performance of our storage systems, and developing financing alternatives for our customers.”
AMAZE – American Made Zinc Manufacturing – is the firm’s plan to ramp-up US manufacturing of its battery technology to 3GWh from 800MWh currently, which will mostly be funded by a Department of Energy loan announced in September 2023.
The announcement said Eos has a US$13.3 billion pipeline and $602.7 million orders backlog for its product as of 31 March 2024, though has in the past had to defend these claimed figures. It has primarily been active in the US to-date but was exhibiting last week at the ees Europe energy storage trade show and conference in Munich, Germany.
The Nasdaq-listed company’s share price appears to have temporarily been boosted by today’s announcement with Cerberus, which came just as the markets opened at 8am Eastern Time, although has mostly come back down after the initial jump.
Related Knowledge Center: Climate economics
Climate change is now a driver of the world’s economy. The impact is profound:
- Catastrophic weather events — hurricanes, floods, droughts, high temperatures — are more frequent and more extreme. The cost can be measured in both the initial damage caused and the longer-term impact on the economy.
- Vulnerable communities are increasing climate-related investments, hardening infrastructure and taking other protective measures.
- Investment in carbon capture and storage technologies is increasingly rapidly.
- Governments are making investments and crafting regulations to reduce emissions of carbon dioxide and other greenhouse gases.
On top of all of this is the cost of uncertainty. As the Fourth National Climate Assessment, released in 2018 by the U.S. Global Change Research Program, says, “The assumption that current and future climate conditions will resemble the recent past is no longer valid.”