Spring Valley II Swings to Loss Amid Derivative Hit, Trust Income Drop

TL;DR

**Spring Valley II is burning cash and facing a ticking clock, making a successful SPAC merger look increasingly unlikely.**

AI Summary

Spring Valley Acquisition Corp. II, a blank check company, reported a net loss of $502,968 for the six months ended June 30, 2025, a significant decline from the net income of $3,910,581 for the same period in 2024. This shift was primarily driven by a substantial 'Change in fair value of derivative liability' which resulted in a $730,150 loss in 2025, compared to zero in 2024. General and administrative expenses decreased to $316,503 in 2025 from $431,979 in 2024. Interest income from the Trust Account also saw a sharp reduction, falling to $536,801 in 2025 from $4,316,478 in 2024. The company's cash balance decreased from $495,352 at December 31, 2024, to $157,647 at June 30, 2025. Total liabilities increased to $2,276,818 as of June 30, 2025, from $1,708,768 at December 31, 2024, largely due to the new non-redemption agreements derivative liability of $730,150. The company extended its deadline to complete a Business Combination to October 17, 2025, and faces liquidity risks if it cannot secure additional funding or complete a business combination.

Why It Matters

This 10-Q reveals Spring Valley Acquisition Corp. II's deteriorating financial health, marked by a significant net loss and declining cash. For investors, this signals increased risk in the company's ability to complete a Business Combination by the October 17, 2025 deadline, potentially leading to liquidation and a return of trust funds at a lower value than current redemption price. Employees and customers are not directly impacted yet, as the company is a blank check entity, but the broader SPAC market may view this as another example of the challenges in finding suitable targets and managing financial obligations. The competitive landscape for SPACs remains fierce, and this filing highlights the pressures on those nearing their combination deadlines.

Risk Assessment

Risk Level: high — The company reported a net loss of $502,968 for the six months ended June 30, 2025, and its cash balance dropped from $495,352 to $157,647 in the same period. The 'non-redemption agreements derivative liability' of $730,150 is a new and significant liability, contributing to a total liabilities increase to $2,276,818. These factors, combined with the looming October 17, 2025, Business Combination deadline, indicate substantial liquidity and operational risk.

Analyst Insight

Investors should consider the increased risk of liquidation for Spring Valley Acquisition Corp. II given its significant net loss and declining cash position. Those holding Class A ordinary shares subject to possible redemption should monitor the share price relative to the $11.79 redemption value as of June 30, 2025, and be prepared for potential redemption if a business combination is not completed by October 17, 2025.

Financial Highlights

debt To Equity

N/A

revenue

N/A

operating Margin

N/A

total Assets

$26,295,879

total Debt

$2,276,818

net Income

-$502,968

eps

N/A

gross Margin

N/A

cash Position

$157,647

revenue Growth

N/A

Key Numbers

• $502,968 — Net loss for six months ended June 30, 2025 (Significant decline from $3,910,581 net income in prior year)
• $157,647 — Cash as of June 30, 2025 (Decreased from $495,352 at December 31, 2024)
• $730,150 — Non-redemption agreements derivative liability (New liability contributing to increased total liabilities)
• $2,276,818 — Total Liabilities as of June 30, 2025 (Increased from $1,708,768 at December 31, 2024)
• $26,090,885 — Cash and investments held in Trust Account as of June 30, 2025 (Increased from $25,554,084 at December 31, 2024)
• $11.79 — Redemption price per Class A ordinary share as of June 30, 2025 (Increased from $11.55 at December 31, 2024)
• October 17, 2025 — Deadline to consummate a Business Combination (Extended from an earlier date)
• 2,213,429 — Publicly-held Class A ordinary shares subject to possible redemption (As of August 13, 2025)

Key Players & Entities

• Spring Valley Acquisition Corp. II (company) — registrant
• Spring Valley Acquisition Sponsor II, LLC (company) — sponsor
• Continental Stock Transfer & Trust Company (company) — trustee for Trust Account
• SEC (regulator) — U.S. Securities and Exchange Commission
• Nasdaq Stock Market LLC (company) — exchange where securities are registered
• FASB (regulator) — Financial Accounting Standards Board
• Investment Company Act 1940 (regulator) — governing act for investments
• Securities Exchange Act of 1934 (regulator) — governing act for securities

FAQ

Risk Factors

• Liquidity and Ability to Complete Business Combination [high — financial]: The company faces significant liquidity risks, with cash decreasing to $157,647 as of June 30, 2025, from $495,352 at the end of 2024. The extension of the business combination deadline to October 17, 2025, highlights the ongoing challenge. Failure to secure additional funding or complete a business combination by this date could jeopardize the company's ability to continue as a going concern.
• Derivative Liability Impact on Net Income [high — financial]: A substantial 'Change in fair value of derivative liability' resulted in a $730,150 loss for the six months ended June 30, 2025, a significant factor in the net loss of $502,968 for the period. This contrasts with zero impact in the prior year, demonstrating a new and material risk impacting profitability.
• Reduction in Trust Account Income [medium — financial]: Income from investments held in the Trust Account decreased sharply to $536,801 for the six months ended June 30, 2025, from $4,316,478 in the same period of 2024. This 87.5% reduction significantly impacts the company's overall income generation capacity.
• Increased Liabilities [medium — financial]: Total liabilities increased to $2,276,818 as of June 30, 2025, from $1,708,768 at December 31, 2024. This increase is primarily driven by a new non-redemption agreements derivative liability of $730,150, adding to the company's financial obligations.
• Dependence on Business Combination Completion [high — operational]: As a blank check company, Spring Valley Acquisition Corp. II's existence and value are entirely dependent on successfully identifying and completing a business combination. The extended deadline and current financial position suggest challenges in achieving this objective within the required timeframe.

Industry Context

Spring Valley Acquisition Corp. II operates within the Special Purpose Acquisition Company (SPAC) sector. This industry is characterized by companies formed to raise capital through an IPO with the sole purpose of acquiring an existing business. The competitive landscape involves numerous SPACs vying to identify attractive acquisition targets within specific industries, often facing tight deadlines to complete a business combination before liquidation.

Regulatory Implications

As a publicly traded entity, Spring Valley Acquisition Corp. II is subject to SEC regulations and reporting requirements. The primary regulatory risk revolves around the timely completion of a business combination, as mandated by its IPO prospectus and governing laws. Failure to meet these deadlines can lead to mandatory liquidation, impacting investors and the company's operational continuity.

What Investors Should Do

1. Monitor Business Combination Progress
2. Assess Liquidity and Funding Needs
3. Understand Derivative Liability Impact
4. Evaluate Trust Account Performance

Key Dates

• 2025-10-17: Deadline to consummate a Business Combination — This is the final deadline for the company to complete its initial business combination. Failure to do so will result in liquidation.
• 2025-06-30: Balance Sheet Date — Reflects a decrease in cash to $157,647 and an increase in total liabilities to $2,276,818, including a new derivative liability of $730,150.
• 2025-06-30: End of Six-Month Reporting Period — The company reported a net loss of $502,968, largely due to a $730,150 loss from the change in fair value of derivative liability.
• 2024-12-31: Previous Year-End Balance Sheet Date — Cash was $495,352 and total liabilities were $1,708,768, with no derivative liability from non-redemption agreements.
• 2024-06-30: End of Prior Year Six-Month Reporting Period — The company reported a net income of $3,910,581, with significant interest income from the Trust Account and no derivative liability impact.

Glossary

Blank Check Company

A shell corporation that is set up to acquire or merge with an existing company. These companies raise capital through an Initial Public Offering (IPO) and then use the funds to acquire a target company, which is often privately held. (Spring Valley Acquisition Corp. II is a blank check company, meaning its primary purpose is to find and merge with another business.)

Derivative Liability

A financial obligation arising from a derivative contract, such as an option or warrant, whose value is derived from an underlying asset. Changes in the fair value of these instruments can impact a company's net income. (A new derivative liability related to non-redemption agreements significantly impacted the company's financial results in the current period.)

Trust Account

An account established by a special purpose acquisition company (SPAC) to hold the proceeds from its IPO. These funds are typically invested in U.S. Treasury bills or other low-risk securities and are used to fund the business combination or returned to shareholders upon liquidation. (The income generated from the Trust Account is a key component of the company's other income, and its reduction has impacted profitability.)

Redemption Price

The price at which holders of redeemable shares, typically Class A ordinary shares in a SPAC, can elect to have their shares repurchased by the company, usually prior to or upon a business combination or liquidation. (The redemption price per share has increased, impacting the potential outflow of cash if many shareholders choose to redeem their shares.)

Accumulated Deficit

The cumulative net losses of a company that have not been offset by net income. It represents the total loss incurred by the company since its inception. (The accumulated deficit has grown to $2,072,591 as of June 30, 2025, reflecting the company's net losses.)

Year-Over-Year Comparison

Compared to the six months ended June 30, 2024, Spring Valley Acquisition Corp. II has experienced a dramatic shift from net income of $3,910,581 to a net loss of $502,968. This reversal is primarily driven by a new $730,150 loss from the change in fair value of derivative liability, which was zero in the prior year. Additionally, income from the Trust Account has plummeted by 87.5%, from $4,316,478 to $536,801, further contributing to the negative performance. While general and administrative expenses decreased, the overall financial picture has deteriorated significantly.

Key Financial Figures

• $0.0001 — nsisting of one Class A ordinary share, $0.0001 par value, one right and one-half of on
• $11.50 — ordinary share at an exercise price of $11.50 SVIIW The Nasdaq Stock Market LLC

Filing Documents

• svii-20250630x10q.htm (10-Q) — 1166KB
• svii-20250630xex31d1.htm (EX-31.1) — 14KB
• svii-20250630xex31d2.htm (EX-31.2) — 14KB
• svii-20250630xex32d1.htm (EX-32.1) — 7KB
• svii-20250630xex32d2.htm (EX-32.2) — 8KB
• 0001410578-25-001755.txt ( ) — 6113KB
• svii-20250630.xsd (EX-101.SCH) — 48KB
• svii-20250630_cal.xml (EX-101.CAL) — 20KB
• svii-20250630_def.xml (EX-101.DEF) — 226KB
• svii-20250630_lab.xml (EX-101.LAB) — 367KB
• svii-20250630_pre.xml (EX-101.PRE) — 312KB
• svii-20250630x10q_htm.xml (XML) — 1046KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements 1 Condensed Balance Sheets as of June 30, 2025 (unaudited) and December 31, 2024 1 Unaudited Condensed Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 2 Unaudited Condensed Statements of Changes in Shareholders' Deficit for the Three and Six Months Ended June 30, 2025 and 2024 3 Unaudited Condensed Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 4 Notes to Unaudited Condensed Financial Statements 5 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 25 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 34 Item 4.

Controls and Procedures

Controls and Procedures 34

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 36 Item1A.

Risk Factors

Risk Factors 36 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 37 Item 3. Defaults Upon Senior Securities 38 Item 4. Mine Safety Disclosures 38 Item 5. Other Information 38 Item 6. Exhibits 39 SIGNATURE 41 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1.FINANCIAL STATEMENTS SPRING VALLEY ACQUISITION CORP. II CONDENSED BALANCE SHEETS June 30, 2025 December 31, 2024 (unaudited) Assets: Current assets: Cash $ 157,647 $ 495,352 Prepaid expenses 47,347 61,361 Total current assets 204,994 556,713 Non-current assets: Cash and investments held in Trust Account 26,090,885 25,554,084 Total non-current assets 26,090,885 25,554,084 Total Assets $ 26,295,879 $ 26,110,797 Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders' Deficit: Current liabilities: Accounts payable $ 46,668 $ 88,768 Accrued expenses — 120,000 Extension promissory notes - related party 1,500,000 1,500,000 Total current liabilities 1,546,668 1,708,768 Non-redemption agreements derivative liability 730,150 — Total Liabilities 2,276,818 1,708,768 Commitments and Contingencies Class A ordinary shares, $ 0.0001 par value; 300,000,000 shares authorized; 2,213,429 and 2,213,429 shares subject to possible redemption at $ 11.79 and $ 11.55 per share as of June 30, 2025 and December 31,2024, respectively 26,090,885 25,554,084 Shareholders' Deficit: Preference shares, $ 0.0001 par value 1,000,000 shares authorized none issued and outstanding as of June 30, 2025 and December 31,2024, respectively — — Class A ordinary shares, $ 0.0001 par value; 300,000,000 shares authorized; 7,666,666 non-redeemable shares issued and outstanding as of June 30, 2025 and December 31, 2024 767 767 Class B ordinary shares, $ 0.0001 par value; 30,000,000 shares authorized; 1 share issued and outstanding as of June 30, 2025 and December 31, 2024 — — Additional paid-in capital — — Accumulated deficit ( 2,072,591 ) ( 1,152,822 ) Total shareholders' deficit ( 2,071,824 ) ( 1,152,055 ) Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders' Deficit $ 26,295,879 $ 26,110,797 The accompanying not

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