The Art of the Deal
The Rundown - Your weekly SPAC Recap (05/12/24)
Happy Sunday, Friends!Â
The last week of SPACs was packed with activity, including deals, bankruptcies, and IPOs. Two new deals are announced including a SPAC taking a digital commerce platform connecting buyers and sellers public, and a blank-cheque firm merging with a company producing large format projection screens for the entertainment industry. Also, a used car retailer could declare bankruptcy three years after debuting through a SPAC, and an advanced nuclear fission company sees its shares plummet after completing a SPAC merger. Read on to find out the latest about all things SPACs.Â
SPAC Deals AnnouncedÂ
$WINV is Taking Commerce Platform Xtribe Public
Digital Commerce platform Xtribe, which connects sellers with local buyers, is going public through a merger with SPAC WinVest Acquisition Corp. Â
Xtribe's platform facilitates the online and in-person trading of goods and services for individuals and businesses by creating a virtual marketplace that is enhanced with AI and data analytics, offering features like personalized recommendations and real-time messaging for efficient, secure transactions.
The platform targets SME customers by simplifying their access to a digital presence to attract new customers.
The transaction values Xtribe at an enterprise value of $141 million, assuming no redemptions. The merger is anticipated to close in late 2024, post which the combined company will list on the Nasdaq stock exchange.
WinVest previously raised $115 million through an IPO in September 2021, targeting businesses in the financial services industry, but redemptions have left it with around $44.06 million in cash.Â
$FGF Merging With Strong/MDI Screens in $30 Million Deal
SPAC Fundamental Global is merging with majority-owned subsidiary Strong/MDI Screen Systems in a deal valuing the firm at a pre-money valuation of $30 million.Â
The company which has been in the entertainment industry for over 90 years provides products and services to cinema exhibitors and other entertainment venues.Â
It manufactures and distributes premium large format and Eclipse curvilinear projection screens, which are designed for use in theme parks, immersive exhibitions, and simulations, and offers a range of services including comprehensive managed services and technical support.Â
Additionally, the company provides maintenance, repair, installation, and network support services primarily to cinema operators in the United States.
The SPAC plans to pay the company 25% of the net proceeds from any concurrent private placement in cash, issue preferred shares worth $9 million, and distribute additional shares based on the MDI equity value minus the cash and preferred shares, divided by $10.
If approved, the merged entity will be called Saltire Holdings, concentrating on expanding a portfolio of profitable and cash-flow-generating private equity investments not typically accessible to public market investors.
De-SPAC NewsÂ
$CZOO Close to Bankruptcy Three Years After Debuting Through $7 Billion SPAC Deal
Struggling online used car retailer Cazoo is nearing administration, jeopardizing around 1,000 jobs and marking a significant downturn for a former pandemic-era favorite that debuted through a SPAC merger valuing the firm at $7 billion.
The firm, founded in 2018 by Alex Chesterman, who previously started Zoopla and LoveFilm, gained popularity during the lockdown and was valued at $7 billion when it went public on the New York Stock Exchange in 2021, a value that has since plummeted to $30 million.
In January 2023, Chesterman stepped down as Cazoo's chief executive to become chairman, left the company completely in December, and his successor, Paul Whitehead, resigned as chief executive in March.
The company's recent filing with the SEC indicates a 10-day window to either secure a buyer or enter administration. Cazoo has cited difficulties in attracting investor funding while also mentioning that it may fail to meet the deadline to file annual accounts.
In March, Cazoo transitioned to an online marketplace model, selling off its inventory and allowing dealers to list cars on its platform, while also shutting down its European operations. Despite exploring various strategic alternatives to avoid insolvency, including selling parts of its business, the company has yet to find a buyer.
SPAC NewsÂ
$GPAT Files to Raise $250 Million Through Initial Public Offering
SPAC GP-Act III Acquisition announced plans to raise $250 million through a Nasdaq initial public offering.Â
The shares are listed under the ticker GPATU, with each unit consisting of a share and half a warrant, redeemable at $11.50 per share. The Class A shares and warrants are expected to trade separately under the symbols GPAT and GPATW.
GP-Act III is a partnership between three parties involving the likes of GP Investments, IDS III, and Boxcar Partners III.Â
The SPAC is being led by CEO Antonio Bonchristiano, with Fersen Lamas Lambranho as Chairman, and Steven Spinner, a partner at Boxcar Partners and Mid Ocean Partners, serving as Co-Chairman and lead outside director of ArcBest.
It aims to utilize GP Investments’ resources, including its teams, deal prospects, and network, to help identify and support the operations of a target for a potential merger. The SPAC first filed for a $250 million offering in March 2021, making several revisions to its prospectus, eventually withdrawing its initial offering in November 2022.
SPAC Deal Updates
$OKLO Plummets 54% on Debut After Merger with Sam Altman’s SPAC
Advanced nuclear fission company Oklo, which debuted on Friday after merging with OpenAI’s Sam Altman SPAC AltC Acquisition Corp, plummeted 54%, closing at $8.54.Â
Oklo's business model focuses on commercializing nuclear fission through mini nuclear reactors housed in A-frame structures, aiming to sell energy to entities like the U.S. Air Force and major tech companies.
The company is currently developing its first small-scale reactor in Idaho to potentially power data centers for AI companies like OpenAI.
Oklo CEO Jacob DeWitte confirmed that the company has not yet generated revenue nor deployed any nuclear plants, targeting 2027 for its first plant to become operational. The company received approximately $306 million in gross proceeds from the SPAC transaction.
After facing regulatory setbacks, including the U.S. Nuclear Regulatory Commission's denial of Oklo’s application for an Idaho reactor in 2022, the company is preparing a new application for submission early next year and is currently in the "pre-application engagement" stage with the commission.
Meme of the Day
My Family When I Tried to Explain Why I'm Losing Money
