Amazon obtains right to buy stock in Generac, boosting power company's share price by over 40%

Amazon was granted warrants to purchase up to $340 million worth of Generac stock, sending shares of the backup power provider soaring more than 40% in extended trading on Wednesday. As part of the agreement, Generac said in a securities filing that it issued warrants to Amazon to acquire up to 1.69 million shares in the company at $200.93 a piece for a total investment that could be worth as much as $8 billion. Generac will supply Amazon with backup power generators for its data centers, with initial deliveries expected to total $2.4 billion in 2027 and 2028, the filing states. About 308,000 warrant shares vested immediately and the remaining tranches vest contingent upon payments for the generators. The warrants are equivalent to almost 3% of outstanding shares in Generac, which has a market cap of about $10.3 billion, as of Wednesday's close.