ArcLight Clean Transition Corp. gains 3% on SPAC deal for ‘green’ firm Opal Fuels (update)

Andrii Yalanskyi/iStock via Getty Images ACTD rose 2.9% to $10.10 on the news, while ArcLight investment units (NASDAQ: ACTDU ) finished 2.5% higher at $10.45 and the company's warrants (NASDAQ: ACTDW ) gained 2.8% to close at $1.84. Opal collects and converts the material to a low-cost, ecofriendly diesel-fuel alternative for heavy trucks. Opal says the fuel can cost 40% to 70% less than traditional diesel while significantly reducing truck fleets’ carbon footprints. “Opal Fuels' business contributes meaningfully to sustainable development in the transportation, waste management and agricultural industries by enabling the adoption of leading-edge methane-capture technologies and processes that drastically reduce greenhouse-gas emissions,” ArcLight President and CEO Jake Erhard said in announcing Thursday’s deal. Opal co-CEO Adam Comora called RNG “a right-now solution to the right-now problem of climate change. … Its production uses existing technologies proven at scale, it can be transported on existing pipeline infrastructure and it can be stored effectively until its use.” Opal runs a vertically integrated RNG business, from creating the fuel to shipping it to end-users in 42 U.S. states. The company currently operates 21 biomethane projects, with 23 more in its developmental pipeline. The special purpose acquisition company deal calls for Opal to receive as much as $536M cash, with the funds earmarked to paying for the firm’s planned RNG developments. Opal will receive $311M from ArcLight, less any redemptions from shareholders who don’t want to participate in the deal. The merger will also include a $125M private investment in public equity (PIPE) from NextEra Energy (NYSE: NEE ) , Electron Capital Partners, Wellington Management and other backers. Lastly, the deal will involve up to $100M in preferred-equity investment from NEE. Plans call for the merger to close in Q2 2022, with Opal taking over ArcLight’s Nasdaq listing and trading under the ticker symbol “OPL.” However, RNG firms have had mixed results so far on Wall Street. For instance, Wall Street initially panned ArcLight's deal, with the company's warrants falling more than 15% Thursday morning. Rival RNG firm Archaea Energy Inc. (NYSE: LFG ) has also had a mixed performance since it agreed in April to a three-way SPAC deal with Rice Acquisition Corp. and Aria Energy LLC. The deal's announcement initially sent Rice shares  up 51.7%  to $15.32. Rice then rose to $18.27 by the time the merger closed in September and Archaea ( LFG ) took over the SPAC's listing. But LFG has traded essentially flat since going public, closing Thursday at $18.35. Seeking Alpha contributor Matt Bohlsen recently checked out ACTD and other companies that aim to  develop cleaner fuels and so-called “carbon-capture technology.”