The Week In SPAC News: Esports Group FaZe Clan Coming Public Via Merger

In SPAC news this week, FaZe Clan announced it has entered into a definitive merger agreement to come public. Meanwhile, Greenrose Acquisition Corp. announced that its shareholders voted to approve the proposed business combination with Theraplant and the acquisition of certain assets of True Harvest.

FaZe Clan Combination

FaZe Clan announced it has entered into a definitive merger agreement to combine with B. Riley Principal 150 Merger (BRPM), a special purpose acquisition company sponsored by an affiliate of B. Riley Financial (RILY). The proposed business combination transaction implies an equity value of approximately $1 billion for the combined company inclusive of nearly $275 million of cash.

Upon completion of the proposed business combination, BRPM will change its name to FaZe Holdings. The combined company's common stock is expected to be listed on Nasdaq under the new ticker symbol 'FAZE.' Estimated gross transaction proceeds total $291 million, including $173 million in cash from BRPM's IPO proceeds held in trust and $118 million from committed PIPE investments.

The proposed business combination is expected to close in the first of 2022, subject to regulatory and stockholder approvals. FaZe Clan describes itself as "the world’s most prominent and influential gaming organization," adding that it has a "hyper-engaged global fanbase of 351 million combined across all social platforms."

Digital World Acquisition Investment

U.S. Representative Marjorie Taylor Greene, a Republican from Georgia, invested up to $50,000 in Digital World Acquisition Corp. (DWAC), a special purpose acquisition company linked to former President Donald Trump's planned social media platform, CNBC's Thomas Franck and Yun Li reported.

According to a disclosure, Green bought a stake in DWAC on Friday worth at least $15,000 but no more than $50,000, the authors note. The SPAC said last week it would merge with Trump Media & Technology Group.

Theraplant Deal Approved by Shareholders 

Greenrose Acquisition Corp. (GNRS), a special purpose acquisition company targeting companies in the cannabis industry, announced that its shareholders voted to approve the proposed business combination with Theraplant and the acquisition of certain assets of True Harvest.

Upon closing of the business combination, which is expected to be in early November, the combined company will be named The Greenrose Holding Company and will continue to be listed on the OTC under the symbols 'GNRSU,' 'GNRS,' and 'GNRSW.' Greenrose also intends to list on the NEO exchange as soon as practicable after the close of the business combination.

Redbox Completes Deal

Redbox (RDBX) announced that it has completed its previously announced business combination with Seaport Global Acquisition Corp. (SGAM), a publicly traded special purpose acquisition company. As a result of the merger, the entity will be known as "Redbox Entertainment." Redbox's common stock and warrants began trading on Nasdaq on Monday, Oct. 25, under the ticker symbols 'RDBX' and 'RDBXW'" respectively.

Lockheed-Backed Satellite Company Announces SPAC Pact

Tailwind Two Acquisition (TWNT), a special purpose acquisition company, and Terran Orbital Corporation, a company in the development, innovation, and operation of small satellites and earth observation solutions, jointly announced that they have entered into a definitive business combination agreement.

Upon the closing of the transaction, the combined company will operate as Terran Orbital Corporation, with plans to list on the NYSE under the symbol 'LLAP.' The pro forma total enterprise value of the combined companies is approximately $1.58 billion. The transaction is expected to close in the first quarter of 2022.

The transaction is supported by gross proceeds of $345 million from Tailwind Two's cash-in-trust, $50 million from a PIPE with participation from AE Industrial Partners, long-term Terran Orbital investor Beach Point Capital, Daniel Staton, Lockheed Martin (LMT), and Fuel Venture Capital, as well as $75 million of additional financial commitments from Francisco Partners and Beach Point Capital.

In connection with the closing of the transaction, up to an additional $125 million in debt commitments from Francisco Partners and Lockheed Martin may be available subject to certain conditions. Existing Terran Orbital shareholders will roll 100% of their equity into the combined company.

Analyst Coverage Initiations

Roth Capital analyst Justin Clare initiated coverage of CBRE Acquisition Holdings (CBAH) with a Buy rating and $14 price target. CBRE Acquisition Holdings is a SPAC that reached a business combination agreement on July 12 with Altus Power.

The analyst believes Altus Power may have "cracked the code" for C&I solar by creating a scalable business model through a focus on standardizing and streamlining each step in the value chain from customer acquisition through financing. With a 900MW+ pipeline and key partnerships with top global real-estate players CBRE and Blackstone, Clare sees strong growth ahead.

DA Davidson analyst Michael Shlisky initiated coverage of Decarbonization Plus Acquisition III (DCRC) - which is in the process of merging with EV battery company Solid Power - with a Buy rating and $13 price target.

Solid Power is "in the lead" on developing a solid-state battery for autos and has "chosen a better path to its presence in the solid-state market" by developing and ultimately producing the electrolyte for sale to battery suppliers across the spectrum while also developing the cells themselves for sale to OEMs, to be produced by external partners in a capital-light fashion, Shlisky told investors. The analyst also argued that Solid Power's "go-public valuation is more-reasonable than less-flexible peers."

Lake Street analyst Ben Klieve initiated coverage of Leo Holdings III Corp. (LIII) - which has announced a proposed business combination with Local Bounti - with a Buy rating and $15 price target. As an early mover in the shift from outdoor to indoor production, Local Bounti is well-positioned for a significant commercial ramp and "has a compelling strategy to quickly reach profitability," Klieve told investors.

The analyst sees the scalability of its business "affording the stock a premium valuation," the analyst added. Local Bounti announced in June that it has agreed to go public through a merger with Leo Holdings III Corp., pursuant to a definitive business combination agreement.

Their transaction values the combined company at an equity value of $1.1 billion, assuming no redemptions, and upon closing of the transaction, the combined company is expected to remain listed on the New York Stock Exchange under the symbol 'LOCL.'

SPAC IPOs This Week

  • AltEnergy Acquisition (AEAE) opened on Oct. 29 at $10.07. The company intends to focus on the "significant opportunities" it believes will "result from the ongoing transformation of the energy ecosystem and the macro trends related to electrification and decarbonization."
  • Project Energy Reimagined Acquisition (PEGR) opened on Oct. 29 at $9.85. The company intends to focus its search on "high-potential ESG targets within the advanced renewable energy 'Grid 2.0' value-chain, including targets focused on grid reliability and stability solutions, electrification of transportation and electric vehicle infrastructure, smart and/or AI-enabled grid optimization, energy storage, second-life use of batteries, and end of life battery recycling."
  • Anthemis Digital Acquisitions I (ADAL) opened on Oct. 28 at $10.06. The company intends to focus its efforts identifying businesses in financial services, or the modern financial technology industry.
  • Seaport Calibre Materials Acquisition (SCMA) opened on Oct. 28 at $10.01. The company intends to focus on businesses in the steel, metals, and metals processing sector.
  • Perception Capital Corp. II (PCCT) opened on Oct. 28 at $10.09. The company intends to concentrate its efforts on identifying and acquiring a technology-enabled company with a proven business model "operating within one of the multiple sectors benefiting from secular tailwinds in industrial technology, which includes businesses focused on: mobility and autonomous motion, automation components and systems, material handling solutions, robotics, additive manufacturing, Internet of Things and connectivity; as well as the sustainability sector with businesses focused on: energy storage, advance battery technologies, the hydrogen economy, waste-to-energy, renewable energy, recycling, building energy management and technologies for clean food, water and air."
  • Focus Impact Acquisition (FIAC) opened on Oct. 28 at $10.08. The company intends to focus its search on businesses that are, or seek to be positioned as, a "Social-Forward Company," which it says "are companies that marry operating excellence with the desire to create Social good, with the benefit of increasing attention and capital flows to such companies while amplifying their social impact."
  • Innovative International Acquisition (IOAC) opened on Oct. 27 at $10.08. The company intends to pursue a business combination within the consumer technology, healthcare, information technology services, or enterprise software as a service sector.
  • OPY Acquisition Corp. I (OHAA) opened on Oct. 27 at $9.97. The company intends to pursue targets in the life sciences industry with a primary focus on novel therapeutics, medical devices, or services that help improve healthcare outcomes.

Disclosure: None

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