Eos Energy (NASDAQ: EOSE) stock surged during intraday trading Monday after the company secured a $315.5 million investment from Cerberus Capital Management LP affiliate.
Eos Energy has secured a strategic investment of up to $315.5 million from an affiliate of Cerberus Capital Management LP to support its growth and restructure its existing debt. The investment aims to enhance Eos’s operational capabilities, positioning the company to meet the increasing demand for long-duration battery storage solutions.
Details of Funding Package
The funding package includes a $210.5 million delayed draw term loan contingent upon achieving operational milestones, and a $105 million revolver available at Cerberus’s discretion. This capital infusion also facilitated the retirement of a $100 million senior secured term loan, improving Eos Energy’s financial position and liquidity.
Joe Mastrangelo, CEO of Eos Energy, expressed enthusiasm about the partnership with Cerberus, stating,
“We are thrilled to partner with Cerberus at a pivotal moment in Eos’ history. This investment provides the critical funding needed to execute our profitability roadmap, while also providing our customers with the confidence that Eos can produce at scale.”
Mastrangelo highlighted Cerberus’s deep operational and technical expertise, which will support Eos in expanding its manufacturing capacity, optimizing the supply chain, and strengthening its market presence.
Eos Energy will leverage this investment to capitalize on its significant market opportunities, which include a $13.3 billion project pipeline and a $602.7 million order backlog as of March 31, 2024. The funding will support Eos’s efforts to scale its operations and achieve profitability, aligning with its strategic growth plans.
Eos Energy received the initial funding of $75 million on June 21, 2024. Cerberus obtained penny warrants and shares of non-voting redeemable non-convertible preferred stock as part of this transaction. The investment underscores Cerberus’s confidence in Eos’s technology and manufacturing capabilities, with potential equity implications tied to performance milestones.
Moreover, Eos continues to engage with the U.S. Department of Energy regarding a loan guarantee, which could further bolster its growth trajectory. The company discussed the details of this strategic investment during a conference call on Monday.
Eos Energy (NASDAQ: EOSE) Stock Reaction
On Monday, EOSE stock soared 22.68%, closing at $1.05, marking a 28.93% increase for the week. The trading volume was 43,377,648 shares, significantly higher than the average daily volume of 6.14 million.
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