Vertical farm company AeroFarms merged with the publicly traded special purpose acquisition company (SPAC), Spring Valley Acquisition in order to continue the expansion of the greens grower both in terms of production and distribution. The transaction will provide up to $357 million in gross proceeds to AeroFarms, including $317 million of unrestricted cash at close to fund future farm development and general corporate purposes.

"Our business is at an inflection point wher we will scale up our proven operational framework and begin our expansion plans in earnest,” said David Rosenberg, Co-Founder and CEO of AeroFarms in a statement. Rosenberg will lead this newly-merged company that is valued at $1.2 billion.

In a statement, the company said that beyond farm development, it intends to use its new-found capital to expand its retail distribution and market penetration, construct additional farms, develop new farming technology and enter new product categories.

Vertical farming has become a hotbed for investors in recent years. Companies like AppHarvest, Revol Greens and BrightFarms have pursued investment for their indoor farming operations to much success. While most of these indoor farming operations have sought private investment, AppHarvest chose to seek its fortunes through a SPAC deal. When the company selected to go public last fall, its valuation hovered at $1 billion, and today, that figure has grown to exceed $1.7 billion.

AppHarvest is not an anomaly in the food and beverage space. SPAC deals have become popular for manufacturers looking for a means to raise cash quickly. However, it is worth noting that while many of these companies have successfully snagged investment and scaled quickly, they are not necessarily operating profitably. Investors are largely putting their money in a vision of the future that is popular with consumers in hopes that the initial infusion of financial capital will propel these businesses to profitable growth.

AeroFarms appears to be heading in the right direction to align with what shoppers want. The company, which was founded in 2004, has been a certified B Corporation since 2017. Not only does it hold a certification that holds significant weight with consumers looking to support sustainable businesses, but AeroFarms says it achieves up to 390 times greater productivity per square foot annually versus traditional field farming while using up to 95% less water and zero pesticides.

According to the greens growing company, the market for its products stands at $1.9 trillion, and AeroFarms has grown over 550 varieties of produce to serve that market. With a large portfolio of products and its established Dream Greens brand, the company said it has a “very bright” future ahead as it looks to satisfy the demand for sustainably grown produce.

“Their team has been selling commercial product with major retailers, building a trusted brand that is performing well, and developing influential partnerships that will enhance their ability to scale this business quickly,” said Chris Sorrells, CEO of Spring Valley in a statement.