B. Riley Principal Merger Corp. II and Eos Energy Storage announce letter of intent for business combination

Eos Energy Storage LLC

B. Riley Principal Merger Corp. II (NYSE: BMRG, BMRG WS, BMRG.U) (“BRPM II”), a special purpose acquisition company sponsored by an affiliate of B. Riley Financial, Inc. (NASDAQ: RILY), and privately held Eos Energy Storage LLC  yesterday announced they have executed a letter of intent (“LOI”) for a business combination transaction which would result in Eos becoming a publicly listed company.

Founded in 2008, Eos Energy Storage is an established provider of long-duration energy storage focused on providing a domestic solution to a global need: low-cost, safe, and environmentally friendly energy storage. Eos has proven its technology over a ten-year period of testing, development, deployment, and operation, and is focused on accelerating the growth of clean energy in the United States by deploying large scale storage solutions that deliver reliable and cost-competitive power in a safe and environmentally sustainable way. The Eos Aurora® system is designed to meet the requirements of the grid-scale energy storage market using Eos’ patented aqueous, zinc-powered battery technology to offer a safe, scalable, fully recyclable and sustainable alternative to lithium-ion battery power. Its patented Znyth® technology requires just five core commodity materials – all of which are Earth-abundant, non-conflict minerals, and are 100% recyclable. Eos’ battery is non-flammable and does not require any moving parts or pumps, which allows for simple upkeep and market-leading low-cost operations.

The proposed transaction would provide Eos with access to new capital to help fund the rapid growth of its corporate strategy, which includes the expansion of its manufacturing capacity to meet customer demand, investment in personnel to further drive research and development (R&D) and commercialization, in addition to general corporate purposes.

“We are pleased to work towards bringing our stockholders this unique opportunity to participate in the rapid growth and expansion of a leading domestic energy storage business,” said Dan Shribman, CEO of BRPM II, and Chief Investment Officer of B. Riley Financial. “We view the proposed combination of BRPM II and Eos to be a compelling transaction that would provide Eos with the necessary capital to support the expansion of its capital-efficient and scalable solution. Having followed Eos for several years, we believe now is the ideal time for management to unlock the full potential of a truly disruptive solution to address a clear need in the global energy storage market.”

Eos is led by a team of professionals with deep scientific, regulatory and operating experience across the energy value chain. Joe Mastrangelo, Eos’ Chief Executive Officer, is a 25-year General Electric (“GE”) veteran who has both traditional and renewable energy experience, and served as president and CEO of Gas Power Systems for GE’s Power division. Russ Stidolph, Chairman of the Eos Board of Directors, is founder and Managing Director of AltEnergy LLC, a private equity firm focused on alternative energy investing.

“Our Board of Directors is pleased to advance the process towards combining with B. Riley Principal Merger Corp. II,” said Russ Stidolph, Chairman of the Eos Board of Directors. “The global energy storage ecosystem is expected to grow with a CAGR of 20% over the next 20 years. The current market is primarily served by lithium ion batteries manufactured in China and South Korea – and with our zinc-based system offering a safer, greener, and less expensive solution, it is our strong belief that Eos is poised for significant long-term growth and material cash flow generation.”

Eos has secured over $160 million of invested capital to date from key strategic and financial investors, including AltEnergy, Holtec International, Reservoir Capital Group, Generation Capital, Ospraie Management, Ace & Company, Fisher Brothers, and Prisma Energy Solutions, among others.

“A transaction with BRPM II would be a natural next step in Eos’ growth from an R&D focused organization to one focused on mass commercialization and scaled manufacturing,” said Joe Mastrangelo, Chief Executive Officer of Eos. “Bryant RileyDan Shribman, and the B. Riley team have a proven track record in leading successful SPAC transactions, as well as extensive experience in public markets, and we believe that this proposed combination would enhance Eos’ ability to provide flexible solutions to our customers while creating value for our current and future stakeholders and partners.”

Eos maintains a significant pipeline of new customers focused on large-scale grid-connected storage projects and smaller-scale commercial and industrial deployments of its energy storage systems. It has deployed its energy storage solutions on three continents and has demonstrated an ability to satisfy multiple use cases while performing in extreme temperature conditions without the need for any supplemental air-conditioning. Eos has a market-ready product today and an established manufacturing platform in place that is ready to scale to meet market demand.

Transaction Overview
The transaction contemplates a pre-money valuation for Eos of approximately $290 million. The proposed transaction with BRPM II would provide Eos with approximately $225 million of additional new equity financing, including $50 million of proceeds from a fully backstopped PIPE by B. Riley Financial, assuming no public shareholders of BRPM II exercise their redemption rights at closing. The proposed transaction is expected to be completed in the fourth quarter of 2020, subject to, among other things, the negotiation and execution of a definitive agreement providing for the transaction, the approval by BRPM II’s shareholders, satisfaction of the conditions stated in the LOI and other customary closing conditions. Accordingly, there can be no assurance that a definitive agreement will be entered into or that the proposed transaction will be consummated.

About Eos Energy Storage LLC
At Eos, we are on a mission to accelerate clean energy by deploying stationary storage solutions that can help deliver the reliable and cost-competitive power that the market expects in a safe and environmentally sustainable way. Armed with a patent for a membrane-free zinc battery technology, Eos has been pursuing this opportunity since 2008 when it was founded. Eos Energy Storage has 10+ years of experience in battery storage testing, development, deployment, and operation. The Eos Aurora® system integrates its aqueous, zinc battery technology (Znyth®) to provide a safe, scalable, and sustainable alternative to lithium ion.

About B. Riley Principal Merger Corp. II
B. Riley Principal Merger Corp. II (NYSE: BMRG, BMRG WS, BMRG.U) (“BRPM II”) is a blank check company incorporated for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses, and is sponsored by an affiliate of B. Riley Financial, Inc. (NASDAQ: RILY). BRPM II is focused on pursuing a business combination with established businesses with an aggregate enterprise value of approximately $400 million to $1 billion that would benefit from access to public markets and the operational and strategic expertise of B. Riley’s management team and board of directors.