Waste hauler Republic Services Inc. has exercised an option to purchase shares of common stock in Vernon-based Romeo Systems Inc., and the two companies announced Nov. 10 that they are exploring a “strategic alliance.”

The announcement comes as Romeo Systems, also known as Romeo Power Technology, prepares for a merger with RMG Acquisition Corp. that will make Romeo a publicly traded company on the New York Stock Exchange.


Once that happens, Republic Chief Operating Officer Tim Stuart is set to join Romeo’s board of directors.


Stuart suggested Romeo, which manufactures lithium-ion battery packs for electric vehicles, would play a key role in Republic’s efforts to stock up on electric-powered waste hauling trucks.


“The establishment of a strategic alliance is an important component of our fleet electrification strategy and will help drive responsible growth and value creation,” Stuart said in a statement.


Phoenix-based Republic is one of the largest waste management companies in the United States and one of seven companies permitted to haul trash and recyclables from commercial buildings in the city of Los Angeles.


In August, the company announced a partnership with Nikola Corp., under which Republic will purchase 2,500 electric trucks.


That deal, however, only represents a fraction of Republic’s fleet of more than 16,000 vehicles.


Romeo was founded in 2016 and mainly manufactures batteries that are specifically designed for the medium- and long-haul vehicles used by the commercial trucking market.


The company received a $900 million pre-money valuation going into its merger deal with RMG, according to a presentation shared with investors in October. Its post-money valuation is $1.3 billion.


At the close of its merger with RMG, Romeo is set to receive $340 million in cash to fund expansion of its production capacity and research and development. The company now employs around 100 employees and operates a 113,000-square-foot manufacturing facility in Vernon.

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