AIDEA diverts $25 million for 'anchor investment' in Idaho nuclear startup
With the sun about to set on the Dunleavy regime, the Alaska Industrial Development & Export Authority is rushing to divert $25 million in state funds to purchase stock in an Idaho startup that intends to build nuclear microreactors.
This is not a risk that AIDEA should be taking with public money.
The $25 million to buy stock apparently comes from excess profits that should have been transferred to the general fund.
Here is how NuCube Energy described the AIDEA investment in an October 19 press release issued two days before Dunleavy and AIDEA revealed the plan to Alaskans: “AIDEA is investing directly in NuCube as the anchor investor in the company’s current financing.”
The company hopes to build and sell high-temperature modular microreactors “designed to deliver both electricity and industrial heat up to 1,100 degrees Celsius.”
“The investment reflects a significant interest and endorsement from the State of Alaska, where many communities and industrial operations rely on costly, imported fossil fuel and sit beyond the reach of traditional power infrastructure,” NuCube Energy said.
“As our anchor investor, AIDEA gives us a solid capital foundation as we continue towards closing our business combination with Launch Two,” NuCube CEO Cristian Rabiti was quoted as saying.
Launch Two Acquisition Corp. is a Cayman Islands “special purpose acquisition company” that is part of a plan to make the combined companies publicly traded.
The state is buying the stock at $9.25 a share, which is a 14.5 percent discount from what the company says the stock is worth.
The $25 million should go to the state general fund, allowing legislators, not the unelected and Dunleavy-controlled AIDEA board, to decide whether the state should be speculating in a private company that has attracted some private money.
NuCube has yet to create a finished product, which means the final answer on whether this is a bomb or a great investment won’t be known for some time.
“AIDEA's stake stands out as targeted public support for an early-stage developer — but its payoff hinges on whether NuCube converts capital into technical and regulatory milestones,” is how one news account put it.
A venture capital firm known as Arizona Nuclear Ventures led the first fund-raising push early this year. Other early investors, who came up with $13 million, included billionaire Rob Walton.
The difference between AIDEA and Walton is that the Walmart heir is not risking state money.
If the goal of NuCube Energy to build a microreactor is solid, then let private industry, not the state, back the company.
But this is Dunleavy we’re talking about and the secretive AIDEA, which acts like a private development bank accountable only to the governor.
Andrew Jensen, former Dunleavy PR man, energy adviser and former head of the imaginary Dunleavy “Office of Food Security,” has been reborn as the AIDEA “Communications and Special Projects Manager.”
The AIDEA employees under Dunleavy simply announced the $25 million stock purchase had been made and that everyone thought it a fine use of public money. The state press release said nothing, however, about this being an “anchor investment.”
The various claims in a self-serving Dunleavy press release do not demonstrate that this was the best use of $25 million. The state has provided no background research and no information about the selection process. Just this press release.
Dunleavy knows nothing about investing or nuclear research. The same goes for Brandon Brefczynski, deputy AIDEA director, and special projects manager Jensen.
“NuCube is headquartered in Idaho Falls, Idaho, near Idaho National Laboratory. The financing was led by Arizona Nuclear Ventures, reflecting a broader strategy to position Greater Phoenix as a national hub for advanced nuclear innovation and deployment,” the Greater Phoenix Energy Council said in a press release in February.
“Arizona’s growth across advanced industries is driving demand for reliable, always-on power,” Sandra Watson, President and CEO of the Arizona Commerce Authority said in a February press release. “We’re excited to welcome NuCube’s expanding operations and support next-generation energy technologies that strengthen grid resilience and long-term competitiveness.”
“With Arizona Nuclear Ventures leading this round, NuCube gains more than capital,” the February press release quoted John Schreiber, General Partner of Arizona Nuclear Ventures, as saying.
“Arizona has emerged as one of the most dynamic growth corridors in the country—spanning advanced manufacturing, semiconductor expansion, and hyperscale data infrastructure. The demand for reliable, scalable energy is accelerating rapidly, and we believe NuCube’s high-temperature microreactor platform is uniquely aligned with that opportunity.”
The only candidate for governor who has had anything intelligent to say about AIDEA and its future is Jonathan Kreiss-Tomkins, who recognizes the agency is not a private entity in which important transactions should be kept secret and never examined in public. Kreiss-Tomkins would be able to improve on what works within AIDEA and fix what’s wrong.
The AIDEA $25 million in stock speculation is a prime example of what’s wrong.
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