Ares Acquisition Corp. and X-energy Reactor Company LLC jointly announced on Tuesday that they have decided to call off their anticipated $1.8 billion merger deal. This decision was primarily driven by the challenging market conditions that both companies have been facing. As a result of this development, the shareholder meeting scheduled for Tuesday, where the business combination was supposed to be voted upon, is now indefinitely postponed.
Ares Acquisition Corp., a special purpose acquisition company (SPAC) affiliated with Ares Management Corp., will be liquidated as a consequence of this decision. At the time of this announcement, the market capitalization of the SPAC stood at $688 million.
On the other hand, X-energy Reactor Company will continue to operate as a private company, benefiting from an undisclosed investment by Ares Management Corp. Despite the termination of the merger, both parties acknowledge the challenges posed by the current financial market environment and the potential for X-energy Reactor Company to thrive as a private entity.
In a statement, Kam Ghaffarian, the founder and executive chairman of X-energy Reactor Company, expressed his recognition of the difficulties faced in the current financial landscape and highlighted the opportunity for the company to move forward as a private entity. Similarly, David Kaplan, the Chief Executive Officer of Ares Management, reiterated their confidence in X-energy Reactor Company’s exceptional talent, unique nuclear technology, and global mission to provide affordable and carbon-free energy.
With this turn of events, Ares Acquisition Corp. and X-energy Reactor Company have jointly decided to step away from their merger deal while expressing optimism about their respective paths moving forward in the ever-evolving energy sector.