Struggling energy company General Fusion to go public via $1B reverse merger

Last year, electric fusion startup General Fusion was struggling to raise money, leaving at least 25% of its employees already receiving $22 million in funding where it thought about how to make the company run better.

Today, General Fusion revealed its survival plan: it will go public in a merger with a private equity firm, Spring Valley IIIplus additional funding from institutional investors. It’s a major financial turnaround for a company whose CEO wrote a public letter last year pleading for funding.

If the deal closes as planned, General Fusion could receive up to $335 million from the deal, more than double what it said it was seeking to raise last year before finding a way to save $22 million.

The transaction will benefit the combined company by approximately $1 billion, General Fusion said. Before the merger was announced. The joint venture, founded in 2002, was already there earned more than $440 millionaccording to PitchBook.

General Fusion plans to use the money to complete its shows, Lawson 26 machines (LM26). The device uses a technique called “inertial confinement,” which works by compressing a fuel pellet until its atoms collide, releasing energy. The National Ignition Facility used an ignition switch instead a well-integrated experimentusing lasers to detonate fuel pellets to release compressive energy.

The LM26 focuses on lasers, however. Instead, it uses steam-powered pistons that drive a wall of liquid lithium metal inside to compress the fuel pellet. The liquid liquid flows through a heat exchanger, which produces steam to circulate the generator. By avoiding expensive lasers or superconducting magnets, which are required in other fusion reactor designs, General Fusion hopes to create a low-cost fusion reactor. But first the company must prove that its strategy is viable.

Last year, before revealing its financial problems, General Fusion said that in 2026, LM26 will disrupt science, in which fusion creates more energy than is needed to start. Scientific breakeven is a very important step, although it is different and easier to find than commercial breakeven, in which fusion reactions produce enough energy to send electricity to the grid. General Fusion did not respond to a request asking if the schedule has changed.

The procurement company, Spring Valley, is one of the experts in flexible integration with the energy industry. It previously took NuScale Power, a small nuclear power company, public on a stock whose share price has fallen more than 50% from its peak last year. The company is also in the process of finalizing a merger with Eagle Energy Metals, a uranium mining company that is also slated to develop its own SMR.

General Fusion is not the first merger company. In December, TAE Technologies announced that it would combine with Trump Media & Technology Group in a joint venture worth more than $6 billion.

The common thread that connects these products is the data center, of course. They are expected to eat about 300% more energy by 2035according to BloombergNEF, it is General Fusion clearly pointing to the rise of data center power announcement of the agreement.

But the company also pointed to the growing trend of electricity, including EVs and electric heat, which could increase the demand for electricity up to 50% by the year 2035. It is a reminder that, while the Trump administration has doubts about the future of electricity, other countries are waiting. Although General Fusion may face technical challenges, developments in the energy world show that if it can offer fusion power at a reasonable price, it will find many willing buyers.