Houston-based Evolve Transition Infrastructure LP (NYSE American: SNMP), San Diego-based Nuvve Holding Corp. (Nasdaq: NVVE) and investment vehicles managed by New York-based Stonepeak Partners LP are launching a joint venture focused on electric mobility.
Evolve, Nuvve and Stonepeak announced on May 17 they agreed to pursue the formation of a joint venture dubbed Levo Mobility LLC, a firm aimed at accelerating the development of electric vehicle fleets. Evolve and Stonepeak plan to deploy up to $750 million in aggregate capital to fund Levo Mobility, with Evolve funding a maximum of 10% of the capital commitment. Stonepeak will cover 90% of the commitment.
Levo will use the funding and Nuvve's proprietary vehicle-to-grid technology to deploy new electric vehicle fleets, including thousands of electric buses for school districts nationwide and the associated charging infrastructure. The joint venture will also work with customers such as last-mile delivery providers, ride-sharing providers and municipal services.
Evolve, Nuvve and Stonepeak will negotiate to finalize the agreements to form Levo Mobility within 90 days, likely before the end of July, the companies said. The deal also includes warrants for Stonepeak and Evolve to purchase shares of Nuvve common stock.
Evolve Transition Infrastructure changed its company name from Sanchez Midstream Partners earlier this year, after reaching a deal with Stonepeak Catarina Holdings LLC in late 2020. The deal turned full ownership of Sanchez Midstream's general partner over to Stonepeak. Members of the Sanchez family — including Chairman Antonio Sanchez III; President and COO Patricio Sanchez; and Eduardo Sanchez, a board director — left their posts with the firm. In April, the company also reached an agreement with CEO Gerald Willinger to distribute his responsibilities to other executives throughout the rest of the year, after which he will no longer be CEO.
Since the deal with Stonepeak, Evolve shifted its focus to the acquisition, development and ownership of infrastructure related to the renewable energy transition and carbon emissions reductions.
The creation of Levo Mobility aims to capitalize on the trend of fleet electrification, which the companies said is a key part of President Joe Biden's proposed infrastructure plan. In April, Democratic lawmakers unveiled legislation to invest $25 billion in transitioning the nation's fleet of school buses to zero-emission electric vehicles.
Several other companies with ties to Houston — including EnCap Investments LP, Energy Transition Ventures, Baker Hughes Co. (NYSE: BKR) and others — have recently announced launching or contributing to investment vehicles focused on business opportunities in the energy transition. Earlier in May, Houston-based energy asset management and consulting firm Pickering Energy Partners announced the launch of Merge Electric Fleet Solutions, which will work with fleet operators to provide electrification and financial expertise to make the electrification process affordable and scalable.
For the Levo deal, Kirkland & Ellis LLP served as legal adviser to Stonepeak. Coho Strategies and Emergent Strategic Partners provided commercial diligence and strategic planning, DNV served as technical adviser, and KPMG provided financial diligence support to Stonepeak. Mintz, Levin, Cohn, Ferris Glovsky and Popeo PC and Graubard Miller served as legal advisers to Nuvve. Sidley Austin LLP and Hunton Andrews Kurth LLP served as legal advisers to Evolve.
