A small Wilsonville battery maker, ESS Tech, is taking a big leap.
The company said Friday that it plans to trade its stock on the NASDAQ exchange through a deal with an investment fund, ACON S2 Acquisition Corp. The transaction values the company at $1.1 billion.
ESS is pitching a new class of iron-based battery technology that it says will make it easier for clean energy providers, like solar and wind farms, to bank the energy they generate for times when the sun isn’t out and the wind isn’t blowing.
Founded in 2011, the Wilsonville company said Friday’s deal will provide it $465 million to help fund its work. It employs a little more than 100, nearly all of them in Oregon.
ESS forecasts just $2 million in revenue this year and losses of $20 million. It said it anticipates $37 million in revenue in 2022, and 10 times that the following year, turning profitable in 2024. It forecasts $3.6 billion in revenue in 2027.
That’s the kind of lofty speculation usually pitched to venture capitalists rather than the public markets. ESS is going public through an acquisition by a “special purpose acquisition company,” which is essentially an investment fund looking for promising opportunities.
SPACs have grown quite popular in recent months as an alternative to an initial public offering, a cumbersome and expensive process.
But a tiny company operating in the public markets will face a high degree of expenses and scrutiny. It will have to disclose its financial results every three months, meaning it will face intense pressure to meet its ambitious projections.
Eugene electric vehicle startup Arcimoto, for example, has been public since 2017. It’s been buffeted by the markets in the past year, caught between the hype of investors touting Arcimoto’s stock online and short sellers betting it will fail.
ESS said it expects its deal to go public will close in September. Its stock will trade on the Nasdaq exchange under the ticker symbol GWH.