Holtec delays IPO, citing energy demand uncertainty amid U.S. data center backlash
CEO and founder Krishna P. Singh had hoped to raise over $750 million.
Camden-based Holtec Nuclear says it will postpone its plans to raise more than $750 million in an initial public stock offering (IPO).
“Market conditions” sparked the delay in what Wall Street had expected to be one of the largest companies to “go public” this fall, Holtec spokesperson Patrick O’Brien said.
In particular, founder and CEO Krishna P. Singh has blamed the uncertainty in demand for power by U.S. data centers.
“Our business, rightly or wrongly, is viewed as connected to [data centers],” Singh told the Financial Times of London. “We provide nuclear power. So that was, of course, a big factor in market sentiment against nuclear.”
Plans for giant data centers to power artificial intelligence applications, credited with reigniting demand for new U.S. nuclear electric plants, have become an issue in the fall U.S. election campaigns. Political leaders including Pennsylvania Gov. Josh Shapiro and his Republican opponent state Treasurer Stacy Garrity have diluted and even reversed previous support for data center projects amid a wave of strong local opposition.
Nuclear power stocks that soared on expected data center demand have slipped. For example, shares of Constellation Energy — the Baltimore company that is speeding work to reopen a nuclear power plant at Three Mile Island near Harrisburg — have fallen from a high of over $400 last fall to the mid-$260s in recent trading.
The VanEck Uranium and Nuclear ETF, an index-based investment fund whose largest holding is Constellation and also includes uranium suppliers such as Cameco and Denison Mines, peaked at over $160 in January but has lately traded below $110.
Holtec said it plans to release a formal statement on the IPO delay later Thursday.
The company employs around 4,150 people, including employees at its Advanced Manufacturing Division and headquarters in Camden, plus manufacturing units in Pittsburgh and Orrville, Ohio.
Holtec is best known for decommissioning and removing spent uranium fuel from aging nuclear power plants, which were mostly developed in the 1970s and 1980s.
Holtec is one of several U.S. companies that has developed smaller, modular reactors (SMRs). It says these can replace larger power plants and be swapped out for maintenance without turning off power production. It is working install the first two SMRs at the Palisades nuclear plant site in Michigan, which Holtec decommissioned, purchased, and is now working to restart. Other products Holtec has been developing include the “Green Boiler” liquid battery for storing solar energy.
The company had enlisted J.P. Morgan, Guggenheim Securities, Goldman Sachs & Co., Citigroup, and Bank of America’s securities arm to lead its IPO share sales effort. Morgan Stanley and Commerce Secretary Howard Lutnick’s Cantor Fitzgerald also participated.
