RRG-backed $316m SPAC to be dissolved

Sustainable Development Acquisition Corporation faced an August 12 deadline to complete a merger in its target sectors of water, food and agriculture, renewable energy and resource management.

The directors of the Renewable Resources Group-backed SPAC Sustainable Development Acquisition Corporation (SDAC) have announced their plans to liquidate the company ahead of a deadline to complete a merger by mid-August.

The redemption of public shares is expected to be completed by July 24 at a price of $10.39 per share and comes after an initial February deadline was extended and was due to expire on August 12.

SDAC was formed in February 2021 as a partnership between RRG Global Partners Fund – an RRG vehicle – and Sustainable Investors Fund (SIF), a private investment vehicle associated with Capricorn Investment Group, an investment manager owned principally by a foundation controlled by former eBay president Jeffrey Skoll, which maintains offices in New York and California.

SDAC raised $316 million in an IPO that brought the company on the Nasdaq Exchange at $10 per share. It described plans to merge with a company operating in the UN SDG-related sectors of water, food and agriculture, renewable energy, environmental resource management sectors and related technologies.

SDAC partner Nicole Neeman Brady, who also serves as an operating partner and managing director at RRG, said in February 2021 the search was likely to include a focus on companies in water irrigation, filtration, re-use, treatment and handling. SDAC’s prospectus described RRG and Capricorn as having developed a “pioneering” ESG integration and implementation process over the course of eight collaborative deals starting in 2006.

“My background is coming from Renewable Resources Group, but I am 100 percent dedicated to this effort,” she told Agri Investor. “Unlike most SPACs, where it is GPs taking the sponsor interest and putting up the at-risk capital, we’re actually doing it with our funds.”

RRG had $2.5 billion in assets under management as of December, according to a May filing. Its investments include Berlin, Germany-headquartered 12Tree, which has developed large-scale agroforestry projects in seven countries; farmworker benefit company California Harvesters and Tule Fog Farms, an almond and pistachio-focused subsidiary of Homer, a collection of water assets RRG developed as a portfolio company of Vision Ridge Partners.

In a February 2021 interview with Yahoo Finance, Neeman Brady said SDAC’s search  would focus on companies that were “disrupting the status quo” through their efforts to impose the efficiencies necessitated by climate change.

“We have a global team that includes hydrologists and agronomists, so we can really get down into the technical details and understand things. That is a critical component of knowing if a company really is just hype, or if there’s something underlying there,” she said.

Capricorn Investments did not reply to messages seeking further detail. The company managed $5.5 billion on a discretionary basis and $3.2 billion on a non-discretionary basis as of December, according to a March filing.

SDAC is one of two SPACs invested in by Capricorn’s SIF, which focuses on emerging fund managers operating in climate solutions, inclusive capitalism, health and wellness and sustainable markets. The vehicle’s other investments include carbon allowance trader Kepos Capital, renewable energy focused Ecofin US Renewables Infrastructure Trust and Respira, which provides long-term offtake agreements for nature-based project developers.

SIF’s principals include Capricorn executives William Orum, Michaela Edwards and Robert Schultz.

Schultz and Neeman Brady were among the board members approved at SDAC’s annual meeting in December, alongside MKH Capital Partners founder and managing partner Annette Rodriguez; former California State Treasurer Kathleen Brown, who participated in more than $4 billion of water and power financings in that position and spent 12 years in banking positions at Goldman Sachs, according to her LinkedIn profile; and Andrew Kassoy, co-founder of B Lab, which created the B Corp standard.