NET Power Inc. Chief Financial Officer Akash Patel and General Counsel Jim Mahon joined Ayaz Shaikh, a Mintz Partner and Chair of the Projects and Infrastructure Practice, to discuss NET Power’s (NYSE: NPWR) recent SPAC business combination with Rice Acquisition Corp. II. The $1.5 billion dollar enterprise value transaction was one of the few successful SPAC transactions of 2023. The transaction provided NET Power with more than $675 million in gross proceeds, including $540 million in PIPE capital from financial and strategic investors, and only a 60% redemption rate — well below the industry average for SPACs in recent years. With this investment, NET Power plans to lead the development of proprietary utility-scale plants that will provide reliable, on-demand natural gas power with life cycle emissions that are 90% below today’s combined cycle natural gas systems.
Among other topics, the panelists discussed the challenges faced in completing the SPAC transaction. Specifically, NET Power had to demonstrate to Rice and its other investors that the company’s IP portfolio was adequately ring-fenced from competitors and that the proprietary Net Power Cycle was deployable and scalable. The NET Power team emphasized that vigilant long-term planning was required to develop, manage, and protect their portfolio of IP as they actively engaged regulators and partners for the development and construction of their 50 MWth natural gas power test facility in LaPorte, Texas. Once online, the test facility allowed the company to show scalable proof of concept to investors and lock in long-term relationships and agreements with suppliers and manufacturers for its novel turbine technology and processes. With the influx of capital from the SPAC transaction, NET Power reports that it is well positioned to move its business model beyond licensing to lead the development of the first-of-its-kind 250 MWth natural gas power plant utilizing NET Power’s technology.