Li-Cycle Corp. is nearing a deal to go public through a merger with Peridot Acquisition Corp. (NYSE:PDAC) at a valuation of about $1.7 billion, according to people familiar with the matter.

The deal could be announced as early as February 16, 2021, the sources said, requesting anonymity ahead of an official announcement. It represents a bet on the growing market for recycling used batteries, as well on the rising demand for lithium-ion power sources for new technologies such as electric vehicles.