Rice Acquisition Inc. (RICE) stock declined by 0.49% at the last trading close whereas the RICE stock gains by 5.15% in the pre-market trading after RICE made its agreement official with Aria Energy and Archaea Energy. Rice Acquisition Corp. is headed by retired Rice Energy and EQT executives, the country’s largest natural gas producer. To grow the world’s renewable energy supply, we aim to use our experience in building industry-leading energy production companies.
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On April 7, 2021, RICE announced that RICE has signed an agreement to merge with Aria Energy and Archaea Energy to establish the industry’s leading sustainable natural gas network. Archaea Energy will be the combined company’s brand, with an accomplished management team made up of executives from Archaea LLC and Aria. The deal is scheduled to close in the third quarter of 2021, and the merged company intends to list on the New York Stock Exchange under the ticker symbol “LFG.”
Insight of the agreement
The merger initiated by RICE is expected to build the industry’s most advanced vehicle for capturing and converting waste emissions from landfills and anaerobic digesters into low-carbon RNG, power, and renewable hydrogen in the United States.
Aria, a subsidiary company of Ares Management’s Infrastructure and Power strategy, will be purchased for $680 million, bringing with it a diverse portfolio of operational LFG properties, best-in-class operating expertise, and a vast amount of greenfield LFG-to-RNG projects and electric-to-RNG conversion opportunities. Archaea LLC is being purchased for $347 million and will offer leading RNG technology experts, the deep inventory of LFG-to-RNG projects as well as the world’s largest RNG plant currently under construction, an ambitious commercial strategy, pioneering low-cost carbon sequestration, and negative-carbon LFG-to-green hydrogen production projects currently in the design stage.
The combined company would have over $350 million in cash on hand, offering enough capital to finance its production schedule and allowing the combined company to generate free cash flow beginning in 2023.
A majority-independent board of directors will lead the merged company, which will include RAC executives Daniel J. Rice, IV, Kyle Derham, Kate Jackson, Joe Malchow, and Jim Torgerson; Archaea CEO Nicholas Stork; and Ares CEO Scott Parkes.