nuclear-news

Don’t hold your breath waiting for NuScam’s small nuclear reactors to be profitable

As for valuation, the company is being valued on significant growth occurring in the potentially far distant future, so prospective investors would essentially be betting on the company’s ability to sell operating units at scale and profitably…and to do so in the coming near-to-medium term rather than the 2030s or beyond.

Spring Valley Completes NuScale Merger, But Growth Timing Is Unknown,  Donovan JonesMarketplace, Author of IPO Edge.  May 18, 2022 A Quick Take On NuScale.

Spring Valley Acquisition Corp. (NYSE:SMR) has announced the closing of its initial business combination with NuScale Power for an estimated enterprise value of approximately $1.9 billion.

NuScale has developed proprietary nuclear small modular reactors for utilities and industrial customers.

It is likely that NuScale will require significant time to generate material revenue growth and even longer for profits

…………….  Business Combination Terms

The Spring Valley Acquisition SPAC originally raised $230 million in gross proceeds in its IPO in late 2020, selling a total of 23 million units including underwriter allotments.

The previously announced transaction included a PIPE (Private Investment in Public Equity) which rose to $235 million from Samsung C&T, DS Private Equity, Segra Capital Management and Spring Valley’s sponsor Pearl Energy.

The deal will provide NuScale with gross proceeds of up to $413 million to pursue its commercialization initiatives and growth plans.

Major NuScale investor Fluor Corporation will retain approximately 60% ownership of NuScale, with other legacy shareholders retaining approximately 20.4%, the Spring Valley SPAC public shareholders having 6.5%, the Spring Valley Acquisition Sponsor retaining 2.4% and PIPE investors purchasing 10.7% of the outstanding NuScale stock.

……………….  As for valuation, the company is being valued on significant growth occurring in the potentially far distant future, so prospective investors would essentially be betting on the company’s ability to sell operating units at scale and profitably…and to do so in the coming near-to-medium term rather than the 2030s or beyond.

……………..  In any event, it is likely that NuScale will require significant time to generate material revenue growth and even longer for profits, so I’m on Hold over the near term for SMR.  https://seekingalpha.com/article/4512948-spring-valley-completes-nuscale-merger-but-growth-timing-is-unknown

May 19, 2022 - Posted by Christina Macpherson | business and costs, Small Modular Nuclear Reactors, USA