November 22 (Renewables Now) - US renewable diesel and sustainable aviation fuel maker NEXT Renewable Fuels Inc has agreed to merge with blank check company Industrial Tech Acquisitions II Inc (NASDAQ:ITAQ) in a deal that will introduce it as a publicly traded entity with an expected equity value of about USD 666 million (EUR 649.3m) at closing.
NEXT is dedicated to recycling organic feedstock, such as used cooking oil, into renewable transportation fuels. The tie-up deal comes as the company is working on the construction of a 750 million gallon-per-year renewable diesel and sustainable aviation fuel refinery in Oregon which is expected to start production in 2026.
The agreed combination is expected to generate about USD 176 million in gross cash proceeds from ITAQ’s trust account, assuming no redemptions by the blank check company’s public shareholders, a joint press release said on Monday.
Upon completion, the combined company will be named NXTCLEAN Fuels Inc and it is expected to have an implied post-money pro forma enterprise value of about USD 530 million.
“West Coast states are demanding a clean fuels conversion of the transportation and aviation industries with aggressive targets necessitating rapid increases in clean fuel supplies,” NEXT’s chief executive Christopher Efird said, adding that the company aims at becoming one of the largest US-based suppliers for these markets while also pursuing potential vertical expansion into other clean fuels.
NEXT further disclosed in the Monday statement that it has attracted a strategic investment from the venture capital arm of United Airlines Holdings Inc. United Airlines Ventures could pour USD 37.5 million more into the business as long as certain milestones are met.