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.
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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.
