Vertical Farming Firm AeroFarms Lands SPAC Merger To Go Public & Become Unicorn

AeroFarms, the New Jersey-headquartered indoor vertical farming firm, has struck a merger deal with black check company Spring Valley Acquisition Corp. to go public on the Nasdaq stock exchange. The transaction slated to close in the second quarter of 2021 is expected to bring in as much as US$357 million in new capital, lifting AeroFarms’ valuation to US$1.2 billion to claim unicorn status. 

AeroFarms has announced a merger agreement with the special purpose acquisition company (SPAC) Spring Valley Acquisition Corp. to become a publicly traded firm on the Nasdaq under the ticker symbol “ARFM”. The business combination, led by AeroFarms’ co-founder and CEO David Rosenberg, is expected to bring in up to US$357 million in gross proceeds, which includes US$232 million in reserves from Spring Valley and US$125 million from a private investment in public equity (PIPE) deal from its investors. 

According to AeroFarms, the transaction – slated to be complete in the second quarter of 2021 – will elevate the firm to unicorn status with an estimated equity value of US$1.2 billion. The capital raised will “fully fund” the company’s aggressive expansion plans, which include growing retail distribution, building additional farms, launching new iterations of its farming tech and entering new product categories. 

We are excited to share this highly compelling ESG investment opportunity by bringing the market leader in the vertical farming industry public.

Chris Sorrells, CEO, Spring Valley

Two existing directors of Spring Valley, Debora Frodl and Patrick Wood, are expected to join AeroFarms’ board following the deal. 

Since its founding in 2004, AeroFarms has become one of the leading agri-tech companies in the field, using its data-driven indoor vertical farming platform that can optimise farms, reduce costs and improve quality while growing produce sustainably. 

AeroFarms’ tech enables a 390-fold increase in productivity per square foot compared to traditional agriculture, while using 95% less water and eradicating the need for pesticides – as well as future-proofing against supply chain vulnerabilities that the Covid-19 pandemic has exposed. 

Operating out of Newark, New Jersey, the company’s facilities currently supply major U.S. retailers including Whole Foods Market, ShopRite, Amazon Fresh and FreshDirect with its Dream Greens consumer brand.

Our business is at an inflection point where we will scale up our proven operational framework and begin our expansion plans in earnest.

David Rosenberg, Co-Founder & CEO, AeroFarms

The fresh capital from its latest deal is expected to fuel AeroFarms’ plans to dramatically increase its retail footprint, as well as innovate new products to capitalise on the estimated US$1.9 trillion total addressable market for core leafy greens and vegetables. 

“Our mission is to grow the best plants possible for the betterment of humanity, and we are executing on this by taking agriculture to new heights with the latest in technology, innovation and understanding of plant science,” commented Rosenberg. 

“Our business is at an inflection point where we will scale up our proven operational framework and begin our expansion plans in earnest. With the support of Spring Valley, we not only have the capital in place to execute our plan, but also a sponsor who shares the same ESG philosophies to make a positive impact on the world, while serving the interests of our shareholders,” Rosenberg continued. 

Spring Valley CEO Chris Sorrells added: “The future is very bright for AeroFarms and we are excited to share this highly compelling ESG investment opportunity by bringing the market leader in the vertical farming industry public.”

AeroFarms’ decision to go public via a blank check company has come as little surprise for industry watchers, who have seen SPACs become the go-to vehicle for numerous high-profile IPOs in 2020, including electric truck firm Nikola and space travel company Virgin Galactic. 

The trend is expected to continue into 2021 with WeWork becoming the latest to make the move, but these moves aren’t confined in the tech world with AeroFarms’ fellow indoor farming player AppHarvest also going public on Nasdaq following a SPAC deal with Novus Capital Corp., which saw it climb to unicorn status in February. AppHarvest welcomed former Impossible Foods CFO David Lee the month before to lead its strategy development and operations. 

All images courtesy of AeroFarms.