Fermi Inc.: Founder Demands Open Sale Process, Claims Board Ignoring Billions in Competing Offers
Shareholder Call, June 30, 2026
Toby Neugebauer, co-founder and largest individual shareholder of Fermi Inc., used a June 30 shareholder call to launch a blistering attack on the company's board governance while revealing that at least seven companies have already completed due diligence on potential acquisition or partnership deals, yet the board refuses to entertain competing offers beyond a single preferred tenant.
The central revelation is that multiple parties, including hyperscalers, sovereign wealth funds, data center infrastructure players, and chip manufacturers, have conducted extensive due diligence and are ready to submit proposals immediately. Neugebauer stated he has received calls from three major investment banks representing serious investors who are "so far along on the due diligence, they're asking my questions like what's the salinity of the water at the site. And we're turning these people away."
The Contract Risk Framework
Neugebauer framed his concerns around a stark proposition that contracts at Fermi's scale are "either an asset or a liability of a company," particularly given what he characterized as the company's relatively modest balance sheet weighed against the enormous contracts it must execute. He singled out the EPC contract with Primoris as a potential liability, stating pointedly that "to say that the Primoris contract is a Fermi 2.0 contract, that was not, is not the case when I was there."
The founder's sleepless night before the call centered on this asymmetric risk profile. He emphasized that tenant contracts, in particular, represent "exponential asymmetrical asset or liability" situations, noting that "if you execute these contracts with these tenants, these are some of the most highly economic contracts on the planet. I believed we could do that. But if you fail to perform these contracts," the penalties could be devastating.
This contract anxiety drove Neugebauer's decision to walk away from what was expected to be announced as the first tenant deal on June 30. He revealed that on December 5, during negotiations in the Pacific Northwest, the prospective tenant dramatically increased penalty provisions after a shareholder representing 185% of the company's float entered the market in November, causing the stock to drop 56%. The tenant "absolutely used the fact that we had a 185% shareholder representing 185% of our float come into the market in November when we were negotiating this transaction" to extract more onerous terms.
Why No Deal Was Signed
Neugebauer provided extensive detail on why Fermi failed to announce a tenant on June 30, the date that had been internally targeted. He acknowledged that "we anticipated June 30 to be a big day for Fermi. We anticipated at the time of our departure that this would be the day that we would announce 2 tenants."
The negotiations with what he called "tenant number 1" continued through at least 10 meetings into February. But on December 5, when presented with revised terms featuring dramatically increased penalties, Neugebauer said the deal team had "just the bad feeling that, wow, we need to go back and look underneath the hood" at Fermi's preparedness to execute. He stated unequivocally: "I am so glad that we did not sign that day and commit."
After the exclusivity period with this tenant expired on January 7, two other potential tenants emerged offering "much better SLA and LD terms with more money." Neugebauer disputed the company's narrative that his departure somehow damaged tenant relationships, pointing out that the stock rose 36% in the four days before his termination "because the market realized that we were going to get tenants, and we were going to get partners."
The Strategic Buyer Universe
Neugebauer laid out a sophisticated strategic rationale rooted in his "3 Cs" framework: capital, customers, and construction expertise. He argued that Fermi's natural acquirer would have low cost of capital, either be a customer or have customers, and excel at large-scale construction. The list of interested parties he identified includes hyperscalers, oil and gas majors (he expressed disappointment that Chevron chose a Microsoft deal instead), data center developers with infrastructure capabilities, sovereign wealth funds, "neo clouds" with one of "the most preeminent ones" having reached out, and chip makers.
His thesis is that Fermi controls "probably highest concentration of permittable gigawatts in the world" with "tons of water" and "no one controls more available electron generation capacity than we do." For companies already holding significant shares of the AI infrastructure market, acquiring Fermi "makes incredible sense for them to grab up Fermi so that they can maintain their big, big piece of the pie."
When pressed on why he wouldn't accept a 20% or 30% premium and move on, Neugebauer was emphatic: "Why would I do that? I didn't work so hard with this team to gobble up all of the critical components to basically control the supply of the pie growth to give it away for a 20% premium over a ridiculous share price."
Management Capability Concerns
While stopping short of impugning management's intentions, Neugebauer made clear his view that the company lacks the depth to execute at scale. He noted that Fermi lost "9 other critical people that were, I would call the leadership behind Fermi 2.0" when he departed. His proposed solution was to install John Sellers and Cody Campbell in leadership positions and allow nine of the departed team members to return at their discretion. Tellingly, "there were no takers. There were no takers."
He stressed the need for "people that can execute large energy projects at scale" and suggested the current leadership knows they're missing this capability. The implication is that without this expertise, Fermi risks turning highly profitable contracts into catastrophic liabilities through execution failures.
The Path Forward and Governance Fight
Neugebauer announced on the call that he would extend the proxy fight timeline until after a Dallas judge rules on related litigation, expected around July 21 or 23. He stated no one should "have a proxy fight over America's 250th birthday" and wants investors "to read the facts and understand what really has past, present and future of Fermi."
He emphasized repeatedly that he has no interest in returning to operational leadership at Fermi, stating "I have no economic or personal incentive to do anything, but hope that the company is incredibly successful." His demands are focused entirely on process: an independent committee review, a banker-led market test beyond the current advisor Broadhaven, and a dual-track process that pursues both the preferred tenant relationship and strategic alternatives simultaneously.
The founder positioned this as a critical test case for Texas corporate governance, noting that the situation has "huge implications for capitalism in America" as companies like SpaceX consider Texas domiciles. He referenced that both a Dallas judge and a federal judge "fully recognize" the historic nature of the governance questions at stake.
Neugebauer also committed to making Fermi REIT-compliant if he prevails, stating he has already established four foundations with independent boards and opened securities accounts to receive shares and resolve the ownership concentration issues. He acknowledged that while achieving REIT status "definitely still think it was the right decision," it has been "a thorn in my side."
On dilution risk, which featured prominently in his contract concerns, Neugebauer acknowledged that executing the tenant deal "will require, I think, potential dilution," reinforcing why the "3 Cs" framework matters so much for identifying an acquirer with a lower cost of capital.
The company's narrative that Neugebauer was terminated for misconduct and damaged business relationships drew a detailed rebuttal. He claimed there will be "not a text, there will not be an e-mail, and there will not be a Board meeting minute" where these issues were raised with him before termination. He attributed 56% of the stock price decline to a shareholder overhang situation when shares held by Penncross Energy, controlled by an associate of former Governor Perry's son, became available within 30 days of the IPO, representing a 185% increase in float.