Nuclear Power Spac: Sam Altman, the AI ​​King, Wants to Split Atoms

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The reverse merger for the electric vehicle start-up has disappointed investors. Perhaps a nuclear power investment vehicle might do better. On Tuesday, nuclear power start-up Oklo announced it would list shares in the US $850 million valuation,

It will do so by merging with financier Michael Klein, a special purpose acquisition company backed by tech and AI entrepreneur Sam Altman. Altman is also the chairman of Oklo.

In the heyday of the space in 2020-21, emerging companies needed to project aggressive financial projections to attract investors. Revenue will start near zero but grow exponentially. But many have failed or will soon do so when their cash runs out.

Oklo eschews even that style of disclosure convention, offering only conceptual nuclear plant economics that could pay off over 40 years of life. This may be a viable project. But it is surprising that such a speculative venture could find a hearing in the public market today.

Oklo’s model is modular nuclear power generation similar to solar or wind farms. Instead of building the typical 1,000 MW plant for a good-sized city, Many of Oklo’s plants only range from 15MW to 50MW in each capacity.

The capital cost for construction and initial fuel outlay for a small plant with less than two acres should be around $60 million. Oklo estimates that at steady state, a 50MW plant generates $29mn annual cash flow on $36mn revenue. Even after capital costs for refueling, a cumulative cash flow of about $1 billion can be achieved over a 40-year life.

The company claims the $850 million valuation is cheap compared to other start-up nuclear and natural gas projects based on capacity.

Oklo’s initial facility in Idaho isn’t projected to come online until 2026 at the earliest. Before that, it has to improve its technology and get the requisite government approval. The toughest test may be convincing Spac investors who deserve their money back to stay afloat.