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To: Glenn Petersen who wrote (3551)11/10/2021 4:20:38 AM
From: Glenn Petersen
   of 3800
 
Nextdoor - the hyperlocal social media website - has completed its merger with Khosla Ventures Acquisition

Nextdoor Surges in Trading Debut

Shares of the social-networking platform for local neighborhoods jump 17%

By Meghan Bobrowsky
Wall Street Journal Co II.
Updated Nov. 8, 2021 4:42 pm ET



Users of the Nextdoor app rose during the height of the pandemic, as they sought to stay connected with their neighbors. PHOTO: MARK LIPCZYNSKI FOR THE WALL STREET JOURNAL
----------------------------

Shares in Nextdoor Inc. surged Monday in their first day of trading as the free social-networking app aimed at connecting local neighborhoods began life as a public company.

The San Francisco-based company that was founded a decade ago made its name helping people scout locally for dog walkers or gripe about neighbors. During the height of the pandemic, with people stuck at home, users took to the platform to check on and stay connected with their neighbors. User numbers shot up to 58 million last year from 48 million in 2019. They grew to 63 million by mid-2021.

“More people came to the platform during the middle of an emergency, but they came and they stuck around,” Nextdoor Chief Executive Sarah Friar recently told investors.

Nextdoor has gone public through a combination with Khosla Ventures Acquisition Co. II, a special-purpose acquisition company sponsored by venture-capital firm Khosla Ventures. It is one of the latest of the many SPAC deals this year and comes as enthusiasm for such transactions has begun to wane.

Khosla Ventures valued Nextdoor at $4.3 billion in the blank-check merger, generating about $674 million in gross proceeds, including $270 million in private investments. Nextdoor was valued at roughly $2.2 billion in September 2019.

Nextdoor shares, trading under the ticker KIND, rose as high as $18.59 in morning trading. The stock closed up 17% at $13.01. Shares of the Khosla SPAC ended trading at $11.12 on Friday.

Nextdoor has a news feed that allows users to post announcements and ask questions to the community, such as searching for missing pets or informing residents about nearby events. The company requires users to register with their home addresses.

The app also includes a feature similar to Meta Platforms Inc.’s Facebook Marketplace, where users can sell furniture, clothes and some other items directly to their neighbors.

Nextdoor said it is used in nearly one of three households in the U.S. and is active in more than 280,000 neighborhoods in 11 countries.

The company, which earns money from ads and sponsored content, said sales reached $123 million last year and projected 47% year-over-year growth in 2021 and a further 40% rise in 2022. Nextdoor remains unprofitable and expects to lose $101 million this year and remain in the red in 2022. Ms. Friar told The Wall Street Journal Monday that the company is focused on growth and declined to project when it may turn profitable.

The deal with the Khosla SPAC will allow Nextdoor to hire more employees and invest in tools that will help the company continue to grow and generate revenue, the company said. Ms. Friar said the company expects hybrid work will allow it to attract talent from across the globe to help deliver growth.

Nextdoor recently has been growing abroad more quickly than in the U.S., and Ms. Friar told investors that the company plans to build on that momentum. “We absolutely think that 2022 is a year when we start to go broader,” she said.

For more WSJ Technology analysis, reviews, advice and headlines, sign up for our weekly newsletter.

Write to Meghan Bobrowsky at Meghan.Bobrowsky@wsj.com

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the November 9, 2021, print edition as 'Nextdoor Surges In Market Debut.'

Nextdoor Surges in Trading Debut - WSJ

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To: Glenn Petersen who wrote (3572)11/10/2021 4:33:53 AM
From: Glenn Petersen
   of 3800
 
The Bird / Switchback merger has closed.

BRDS closed at $7.44 on Tuesday.

Bird’s SPAC Deal is Done: First Day on the NYSE Ends Virtually Flat

Harrison Weber

02:36 PM | November 05, 2021

Bird, the Santa Monica-based firm that makes and rents electric scooters, ended its first full day as a publicly traded company with its stock price up by a fraction of a percent at $8.40 per share.

By merging with Switchback II, a special purpose acquisition company, Bird skipped the traditional IPO process to list on the New York Stock Exchange. Now closed, the deal put a combined $414 million in cash and credit at the scooter company's disposal — minus fees related to the merger, Bird said on Friday.

The SPAC deal originally valued Bird at around $2.3 billion.

Now trading under the ticker "BRDS," Bird CEO Travis VanderZanden said in a statement that the funds will fuel its growth and further its mission of providing "environmentally friendly transportation for everyone." Bird plops rentable scooters on sidewalks in more than 350 cities.

Bird's revenue plummeted at the onset of the pandemic, as lockdowns confined commuters to their homes, but the company recently reported a rebound in revenue and declining losses for its second fiscal quarter of 2021.

While Bird leads the pack on scooter rentals, its competitor Lime revealed today that it raised $523 million from investors ahead of a possible public debut next year.

Why "BRDS"? Earlier this week, footwear company Allbirds started trading on the Nasdaq exchange under the symbol "BIRD," perhaps beating Bird to the punch. Bird did not immediately respond to a request for comment.

Bird’s First Day on the NYSE Ends Flat - dot.LA

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To: Thehammer who wrote (3623)11/10/2021 4:49:10 AM
From: Glenn Petersen
1 Recommendation   of 3800
 
Another quantum computing startup is going public via a SPAC. On October 6, 2021, Supernova Partners Acquisition Company II (stock symbol: SNII), a SPAC that raised $345 million when it went public in March 2021, has agreed to merge with Rigetti Computing, a quantum hardware startup.

Investor presentation: EX-99.2 (sec.gov)

SNII closed at $10.84 on Tuesday.

Quantum hardware startup Rigetti Computing to go public in $1.5B SPAC deal with ex-Zillow CEO

BY TAYLOR SOPER
GeekWire
on October 6, 2021 at 10:45 am



Chad Rigetti, founder of Rigetti. (Rigetti Photo) Rigetti is going public.
--------------------------------
The Bay Area-based makers of quantum computers and processors announced Wednesday that it will merge with a SPAC called Supernova Partners Acquisition Company II in a deal that values Rigetti at $1.5 billion.

Supernova raised $345 million in March to pursue a SPAC deal. It is led by ex-Zillow CEO Spencer Rascoff, in addition to Alexander Klabin, Robert Reid and Michael Clifton. Klabin formerly led Senator Investment Group and will soon become executive chairman of Sotheby’s. Reid spent 21 years at Blackstone. Clifton was most recently a senior investment professional at The Carlyle Group.

This is the second SPAC deal for the group, which previously acquired real estate company Offerpad and took it public earlier this year.

Also known as “blank check” companies, SPACs typically do not have an established business and are used to raise funds via public offering for a future merger or acquisition by a specific deadline. There was a SPAC boom starting in 2020 that continued into this year, with 456 SPAC IPOs in 2021, according to SPACInsider. But the aftermarket performance of SPACs has steadily fallen over the past several months.

Even with more regulatory scrutiny and high-profile SPAC “blowups,” many investors are still bullish about SPACs, The New York Times reported in August.

Rigetti is led by founder and CEO Chad Rigetti, who previously worked in the quantum computing group at IBM and earned his Ph.D from Yale. The 8-year-old company previously raised more than $200 million and plans to receive about $458 million as part of the SPAC merger.

The coming era of quantum computers could bring about enormous changes to the way products and services are built, assuming its potential can be fully realized.

“In the next decade one Rigetti quantum computer could be more powerful than today’s entire global cloud,” Rigetti said in a statement. “Rigetti is the leading innovator in this space. Our team has solved the most pressing scientific problems associated with bringing quantum computing to market by creating a scalable computer and high-performance integration with existing computing systems. We plan to use this capital to accelerate our product development and accelerate our goal to bring this transformational computing capability to every major industry.”

Rigetti reported revenue of $5.5 million for the year ended Jan. 31, 2021, and a net loss of $26.1 million. It estimates revenue to grow to $288 million by 2025, and $594 million by 2026.

IonQ, a competitor to Rigetti, went public earlier this week via its own SPAC deal that valued the company at $2 billion.

Rigetti has more than 130 employees. It plans to trade under the ticker RGTI on the New York Stock Exchange. See the company’s investor presentation here.

Quantum hardware startup Rigetti Computing to go public in $1.5B SPAC deal with ex-Zillow CEO - GeekWire

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To: Glenn Petersen who wrote (3266)11/12/2021 4:51:47 AM
From: Glenn Petersen
2 Recommendations   of 3800
 
A new SI board devoted to Matterport (stock symbol: MTTR): Matterport (MTTR) | Stock Discussion Forums (siliconinvestor.com)

When MTTR completed its merger with Gores Holdings VI on July 22, its shares were trading at $14,47. The stock closed at $22.20 yesterday, While it describes itself as a "...spatial data company leading the digital transormation of the built world," it could be more accurately described as a AI / metaverse play.



From the press release originally announcing the deal:

Matterport takes buildings online so customers can more efficiently design, build, promote and manage their most valuable assets from any fdevice. It starts with the Company's groundbreaking digital twin technology and deep understanding of buildings and spaces, bridging the physical and digital worlds. Matterport's proprietary AI technology automatically creates a dimensionally accurate, photo-realistic, three-dimensional digital twin of any building that is loaded with spatial data. The AI understands what is important about a building or space such as geometry, layout, structural analysis and contents, including furnishings and equipment. Matterport's spatial data provides unparalleled building insights and analysis so that customers have a more efficient and scalable way to experience and manage buildings.

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From: Glenn Petersen11/14/2021 3:50:53 AM
1 Recommendation   of 3800
 
Ventoux CCM Acquisition Corp. (stock symbol: VTAQ), a SPAC that raised $174.225 million when it completed its initial public offering in December 2020, has announced that it is going to merge with Presto, "...known for its kiosks and tablets that let guests order and pay directly at tables and uses speech recognition so customers can order by talking to a device at drive-throughs and other settings. It also uses computer vision and analytics to help eateries optimize operations."

Investor presentation: sec.gov

VTAQ closed at $10.01 on Friday.



Restaurant-Tech Startup Presto Going Public Through $1 Billion SPAC Merger

Presto is known for its pay-at-table kiosks, tablets and artificial-intelligence tools

By Amrith Ramkumar
Wall Street Journal
Updated Nov. 10, 2021 10:02 am ET

Restaurant-technology startup Presto is combining with a special-purpose acquisition company and going public with a valuation of about $1 billion, the companies said.

Founded in 2008 at the Massachusetts Institute of Technology, Presto offers several different technologies that it says automate restaurants and improve the dining experience. It is known for its kiosks and tablets that let guests order and pay directly at tables and uses speech recognition so customers can order by talking to a device at drive-throughs and other settings. It also uses computer vision and analytics to help eateries optimize operations.

Presto has branded itself as a practical solution for restaurants wanting to minimize human interactions during the coronavirus pandemic. It also says it can help address the human-labor shortage in the industry, with many workers electing not to return to service-sector jobs.

“We need to move fast because the brakes are on right now for the entire industry,” Presto Chief Executive Rajat Suri said in an interview. “We can grease the wheels with the right technology.”

Several restaurants use Presto, including McDonald’s Corp. , Applebee’s and Chili’s.

The Redwood City, Calif., firm is merging with the SPAC Ventoux CCM Acquisition Corp. , a blank-check company focused on the leisure and hospitality industries. The Wall Street Journal previously reported that the two sides were nearing an agreement.



Customers can place orders on Presto’s tablets, and restaurant staffers can use the devices to do their jobs more efficiently, the company says. PHOTO: PRESTO
------------------------------------

Presto would join several other technology startups that are working to disrupt industries from manufacturing to advertising in going public by combining with a SPAC. Such mergers have become popular alternatives to traditional initial public offerings, in part because they let the company going public make business projections while raising a large sum of cash.

As part of the deal, Presto is expected to raise a roughly $70 million private investment in public equity, or PIPE. PIPE investors are expected to include some of the restaurant franchises that use Presto.

The Ventoux CCM SPAC has about $170 million and is led by several former hospitality executives. It also is backed by investment bank Chardan Capital Markets LLC.

Also called a blank-check company, a SPAC is a shell company that raises money, then trades on a stock exchange with the sole intent of merging with a private company to take it public. After a deal is announced, the company going public releases detailed financial information that is reviewed by regulators. Once the deal is approved and closes, the private firm replaces the SPAC in the stock market.

Before deals go through, SPAC investors have the right to withdraw their money. Low share prices often motivate them to do so. High withdrawals can dramatically reduce the amount of cash the company going public generates and have made it harder to complete deals lately.

Still, excitement among investors has returned to some SPACs and the companies they take public in recent weeks following a summer slump. Shares of neighborhood social-media app Nextdoor Holdings Inc. have rallied this week after the firm completed its SPAC deal.

The blank-check firm taking former President Trump’s new social-media venture public also has soared recently.

Excitement about electric-vehicle startups such as Lucid Group Inc. that combined with SPACs also has powered shares of many of these firms higher.

Write to Amrith Ramkumar at amrith.ramkumar@wsj.com

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the November 10, 2021, print edition as 'Restaurant-Tech Company Presto Nears SPAC Deal.'

Restaurant-Tech Startup Presto Going Public Through $1 Billion SPAC Merger - WSJ

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To: Glenn Petersen who wrote (3660)11/14/2021 4:18:36 AM
From: Glenn Petersen
   of 3800
 
Rosecliff Acquisition Corp. (stock symbol; RCLF), a SPAC that raised $253 million when it went public in February 2021, has announced that it is going to merge with Gett, a company that "...focuses on streamlining a company’s ride-hailing, taxi and limousine booking options around the world into one platform."

Investor presentation: sec.gov

RCLF closed at $9.85 on Friday.

Gett Reaches $1.1 Billion SPAC Merger to Go Public

Company joins with ride-hailing operators to organize transportation options into one platform for corporate customers

By Amrith Ramkumar
Wall Street Journal
Updated Nov. 10, 2021 9:23 am ET

Gett is merging with a special-purpose acquisition company in a deal that would take the corporate-transportation platform public with a roughly $1.1 billion valuation, the companies said.

Started more than a decade ago as a ride-hailing competitor to Uber Technologies Inc. and Lyft Inc., Gett now focuses on streamlining a company’s ride-hailing, taxi and limousine booking options around the world into one platform. It says doing so saves customers time and money. Gett now joins with companies such as Lyft and Indian ride-hailing operator Ola to offer many different services.

London-based Gett is combining with Rosecliff Acquisition Corp. I, a SPAC backed by the investment firm Rosecliff Venture Management LLC. The Wall Street Journal previously reported that the two sides were nearing an agreement.

Gett is marketing itself as a practical solution for global companies to transport workers rapidly, particularly with many still working from home at least part-time during the coronavirus pandemic. The company now works with roughly a quarter of Fortune 500 companies, including Apple Inc. and Coca-Cola Co.

“It’s prime time for the unique solution Gett has,” Chief Executive Dave Waiser said.

The merger would mark a new step in Gett’s attempt to refocus its operations after closing its New York ride-sharing business Juno in 2019. Several years earlier, Mr. Waiser said it would eventually offer services such as on-demand manicures, housecleaning and pizza delivery.

At one point in 2019, the company was valued at about $1.5 billion and had raised several hundred million dollars in funding, including a roughly $300 million investment from auto maker Volkswagen AG .

Gett still operates ride-hailing services in markets such as Israel and London, but roughly 40% of its trips for corporate clients now come from third parties.

The SPAC deal would add to a string of blank-check mergers tied to the future of transportation. Southeast Asian ride-hailing and app operator Grab Holdings Inc. announced a roughly $40 billion megadeal in March, while Dubai-based Swvl Inc. said this summer it was valued at about $1.5 billion in its SPAC combination. Many other startups tied to electric vehicles, batteries, self-driving cars and flying taxis have also undertaken SPAC mergers in recent years.

Such deals are popular alternatives to traditional initial public offerings, in part because they allow early-stage companies to make business projections that aren’t allowed in IPOs. Startups can often also raise large sums of cash in SPAC deals.

As part of the combination with the Rosecliff SPAC, Gett is expected to raise a roughly $30 million private investment in public equity, or PIPE. PIPE investors are expected to include the SPAC creators and existing Gett investors. The Rosecliff SPAC has about $250 million on hand, though that total could shrink if investors withdraw money before the deal closes.

A SPAC is a shell company that raises money and lists on a stock exchange with the intent of merging with a private company such as Gett to take it public. After it announces a deal, the startup releases detailed financial information and regulators then review the merger. Once it closes, the private company replaces the SPAC in the stock market.

Rosecliff Venture Management has invested in several other startups through its various funds, including sneaker company Allbirds Inc., mattress seller Casper Sleep Inc. and private-jet charter firm Wheels Up Experience Inc., which went public through a SPAC deal.

Write to Amrith Ramkumar at amrith.ramkumar@wsj.com

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the November 10, 2021, print edition as 'Ride-Booker Gett Aims for $1.1 Billion Value via SPAC.'

Gett Reaches $1.1 Billion SPAC Merger to Go Public - WSJ

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From: Glenn Petersen11/23/2021 9:39:34 AM
   of 3800
 
On November 16, 2021, Archimedes Tech SPAC Partners Co. (stock symbol: ATSPT), a SPAC that raised $133 million when it went public in March 2021, has announced that it will merge with SoundHound, a voice AI developer.

Investor presentation: sec.gov

ATSPT is trading at $9.86 this morning.

An internal demo



Hound vs. Google



Voice AI developer SoundHound to go public via SPAC
13:58, 18 November 2021
Carreen Maloney
Capita;.com

SoundHound, a California company that provides voice AI technology to businesses across a variety of industries, announced its plans go public on Nasdaq by merging with a special purpose acquisition company (SPAC).

SoundHound released news of its deal with Archimedes Tech SPAC Partners on 16 November. The merger transaction is expected to close in the first quarter of 2022 with SoundHound receiving gross proceeds of $244m (£181m). The SPAC will provide $133m, while the other $111m will come from a PIPE (private investment in public equity) with shares priced at $10 each.

The newly combined company will be called SoundHound AI (SOUN). The transaction suggests an enterprise value for SoundHound of nearly $2.1bn. SoundHound earned gross profit of $7m on $13m gross revenues in 2020, compared to $3m on $8m in 2019. For 2021, SoundHound estimates it will make $15m gross profit on $20m gross revenue.

Started by Stanford grads

SoundHound’s conversational intelligence technology appeals to companies that want to add customised voice assistants to their products and services, while still retaining and preserving their own brands, users and data. Counted among SoundHound’s customers are Hyundai, Mercedes-Benz, Pandora, Mastercard, Deutsche Telekom, Snap, VIZIO, KIA, and Stellantis.

For example, SoundHound voice technology can enable drivers to ask for directions verbally in their cars and receive a reply.

According to SoundHound’s website, the company was founded in 2005, when “a group of Stanford graduates embarked on a journey, fueled by a vision: Within their lifetimes, we would be talking to products just as we do other people. Inspired to make their vision a reality, our company was born with a simple and powerful mission: Add voice AI to everything.”

Initially the company was named Midomi and it focused on music recognition through an app that was renamed SoundHound in 2009.

Speech-to-meaning technology

In a webcasted investor’s presentation on 16 November, SoundHound CEO and co-founder Keyvan Mohajer explained the technology to listeners. He said most voice technology typically turns speech into text, and then determines meaning from that text. But SoundHound’s developers took inspiration from the human brain, which doesn’t use a two-step process but rather converts speech directly to meaning. SoundHound created proprietary technologies it calls “Speech-to-Meaning” and “Deep Meaning Understanding” to understand complex requests.

“With our Speech-to-Meaning, as you speak to SoundHound’s technology, we perform both speech recognition and language understanding, which results in faster response time and higher accuracy, because real time language understanding can feed into the real time speech recogniser as additional information to reduce the potential errors.”


Mohajer said the company is aiming “to be in billions of devices with voice AI and provide conversational interactions with these devices”.

“Every company will need to have a strategy in voice AI, and there will be success stories built on top of platforms like ours.”

In a YouTube video demonstration of the SoundHound technology titled “ This is Insane,” a smartphone user’s voice is heard peppering his device with a range of questions that were successfully answered in rapid succession. The video received 2.2 million views.

81 patents plus 146 pending

SoundHound has applied for 227 patents. Eighty-one have been granted, while 146 are still pending.

SoundHound’s revenue is derived from three streams. Royalties are earned from products that use its technology, such as vehicles and other consumer goods. Subscription revenue comes from functions its AI technology performs, such as customer service, ordering food, and making reservations and appointments. The third source of revenue for SoundHound is monetisation – people who use products and services that employ SoundHound technology will be a source of sales leads and additional transactions.

Devices will initiate conversations

Mohajer said he envisions human interactions with voice AI-enabled devices being both reactive and proactive.

“We believe that devices around you can ultimately initiate the conversation based on certain triggers and context before you start talking to them. This leads to more interactions with more devices and more monetisation opportunities.”

SoundHound plans to retain its existing management team following the merger.

The PIPE is being anchored by Oracle, Qatar First Bank, Koch Industries, and MKaNN Ventures. There will also be investments by Cota Capital, VIZIO, HTC, FIH Mobile (a Foxconn Technology Group company), Structural Capital, Provco Group, Sompo, and Pejman Nozad, among others.

Voice AI developer SoundHound to go public via SPAC (capital.com)

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From: Glenn Petersen11/29/2021 5:37:02 AM
   of 3800
 
PSTH files its registration statement for the public offering of its SPARC warrants.

Pershing Square SPARC Holdings, Ltd.

Registration statement: S-1 (sec.gov)

Bill Ackman's Pershing Square SPARC files for New York listing

Reuters
November 26, 2021
1 minute read

Nov 26 (Reuters) - Pershing Square SPARC Holdings Ltd, the special purpose acquisition rights company of billionaire investor Bill Ackman, on Friday filed for a public offering of its warrants in the United States.

The SPARC structure has been devised by Ackman and has never been tested on Wall Street before. The move comes months after the prolific dealmaker abandoned a deal for his $4 billion blank-check company to buy a 10% stake in Universal Music Group, due to concerns from the U.S. Securities and Exchange Commission.

The SPARC, an affiliate of Ackman's Pershing Square Tontine Holdings Ltd (PSTH.N), will offer 244.4 million subscription warrants, it said in its filing. (https://bit.ly/3HYH5ja)

Each warrant will give the holder the right to purchase common stock at a minimum price of $10 per share.


The listing will require the SEC to approve a proposal submitted by the New York Stock Exchange, to allow listing and trading of subscription warrants by acquisition vehicles.

If approved, the warrants will be listed on the NYSE, the company said.

Reporting by Niket Nishant in Bengaluru; Editing by Shailesh Kuber

Bill Ackman's Pershing Square SPARC files for New York listing | Reuters

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From: Glenn Petersen12/1/2021 6:24:16 AM
1 Recommendation   of 3800
 
Adit EdTech Acquisition Corp. (stock symbol: ADEX), a SPAC that raised $276 million when it went public in January 2021, has announced that it will be merging with Grid Infrastructure, a bitcoin miner.

Investor presentation: EX-99.2 (sec.gov)

ADEX is trading at $10.29 in premarket trading.

UPDATE 1-Bitcoin miner Griid Infrastructure to go public via $3.3 bln SPAC deal

Reuters
Tue, November 30, 2021, 5:19 AM

(Adds details on deal, background on sector)

Nov 30 (Reuters) - Bitcoin miner Griid Infrastructure said on Tuesday it would go public by merging with blank-check firm Adit EdTech Acquisition Corp in a deal valuing the combined company at about $3.3 billion, including debt.

Ohio-based Griid, the latest bitcoin mining startup to take the blank-check route, will receive $246 million in cash from Adit EdTech's trust account after the deal closes.

A surge in digital currencies this year and increasing backing from major companies have propelled startups in the sector to sky-high valuations in recent months, even as the industry faces scrutiny from regulators.

Earlier this month, cryptocurrency miner Bitdeer Technologies agreed to merge with special-purpose acquisition company (SPAC) Blue Safari Group Acquisition in a deal valued at $4 billion.

That deal followed another cryptocurrency miner Core Scientific Holding Co's announcement in July of a merger with a SPAC backed by BlackRock Inc.


A SPAC is a listed firm with no business operations but a pool of capital that it uses to merge with a private company. The deal then takes the private company public.

Griid Infrastructure will list on the New York Stock Exchange under the new ticker symbol "GRDI".

(Reporting by Mehnaz Yasmin and Radhika Anilkumar in Bengaluru; Editing by Aditya Soni)

UPDATE 1-Bitcoin miner Griid Infrastructure to go public via $3.3 bln SPAC deal (yahoo.com)

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From: Glenn Petersen12/2/2021 4:02:01 AM
1 Recommendation   of 3800
 
Exclusive: Trump's social media venture seeks $1 billion raise - sources

By Krystal Hu
Reuters
December 2, 2021

Dec 1 (Reuters) - Former President Donald Trump's new social media venture is seeking to raise up to $1 billion by selling shares to hedge funds and family offices at several times the valuation it commanded in a deal with a blank-check acquisition firm in October, two people familiar with the matter said.

Trump Media & Technology Group, which has yet to roll out the social media app it says it is developing, already stands to receive $293 million if its deal to list in New York through a merger with blank-check firm Digital World Acquisition Corp (DWAC.O) is completed.

The deal valued Trump Media at $875 million, including debt. Trump Media is now seeking to raise up to an additional $1 billion at a valuation of close to $3 billion, to reflect Digital World's share rally after Trump supporters and day traders snapped up the stock, the sources said.

It is the clearest indication yet that Trump and the Digital World dealmakers are seeking to capitalize on the market euphoria around their venture, which has so far been fueled by its ambitious goals rather than a business that is up and running.

Digital World shares were valued at $10 each in the deal with Trump Media. Trump Media is now looking to secure a so-called private investment in public equity (PIPE) that would value Digital World shares closer to their recent price, the sources said.

The sources added that Digital World shares may be valued based on a 20% discount of their 10-day, volume-weighted average price.

The sources requested anonymity because the matter is confidential. Trump Media and Digital World did not respond to requests for comment. Bloomberg News reported last month that the companies were seeking to raise a PIPE without any details on its terms.

Digital World shares soared on Wednesday, as investors welcomed the news that the PIPE could dilute existing Digital World shareholders less than they expected by pricing at a level much higher than the customary $10 per share seen in most mergers with blank-check firms.

The shares, which had been trading down 6% before news of the $1 billion raise, rallied to close up 7% at $44.35 on Nasdaq, then extended gains in after-hours trade, rocketing up 31%, to $58.01.

Most PIPE transactions are inked before a deal to take a company public is rolled out, and it is far from certain that the companies will raise the entire $1 billion they are seeking following their deal announcement. Many Wall Street firms have snubbed the opportunity to invest, and many of the investors participating in the confidential road shows for the PIPE are hedge funds, family offices and high net-worth individuals, the sources said. Family offices manage the wealth of the very rich and their kin.

Weighing on the deal's appeal is the reluctance of many investors to associate with Trump after he was banned from top social media platforms for encouraging his supporters to participate in the Jan. 6 attack on the U.S. Capitol, which was based on unsubstantiated claims of widespread fraud in last year's presidential election.

Some hedge funds that backed the launch of Digital World, including Saba Capital Management and Lighthouse Investment Partners, have said they sold their shares to distance themselves from the Trump deal.

The deal also faces regulatory risk. U.S. Senator Elizabeth Warren asked Securities and Exchange Commission Chairman Gary Gensler last month to investigate the planned merger for potential violations of securities laws around disclosure. The SEC has declined to comment on whether it plans any action. read more

Trump Media and Digital World have asked investors to finalize commitments to the PIPE by the middle of December, the sources said.

In a PIPE road show attended by one of the sources, investors were asked to commit between $10 million and $20 million. Neither Trump nor Digital World executives made an appearance, and the investor presentation was led by David Boral, the president of EF Hutton, an investment bank that advised Digital World on the deal, the source said. A Trump Media representative was also in attendance, the source added.

But Trump has been personally involved. He has been calling some investors to ask them to make a commitment to the PIPE of more than $100 million, the second of the sources said.

Investors attending the road show were shown a demo from the planned social media app, called TRUTH Social, which looked like a Twitter feed, the sources said.

BIG PLANS

Trump has said he is launching his own social media app to stand up against the companies that have barred him from their platforms. He had 89 million followers on Twitter, 33 million on Facebook and 24.5 million on Instagram at the time he was blocked, according to a presentation on his company's website.

Since Trump was voted out of office last year, he has repeatedly dropped hints that he might seek the presidency for a third time in 2024.

Special purpose acquisition companies such as Digital World had lost much of their luster with retail investors before the Trump media deal came along. Many of these investors were left with big losses after the companies that merged with SPACs failed to deliver on their ambitious financial projections.

TRUTH Social is scheduled for a full rollout in the first quarter of 2022, and is the first of three stages in the Trump Media plan, followed by a subscription video-on-demand service called TMTG+ that will feature entertainment, news and podcasts, according to the news release.

In a slide deck on its website, the company envisions eventually competing against Amazon.com's AWS cloud service and Google Cloud.

Reporting by Krystal Hu in New York Additional reporting by Echo Wang in New York Editing by Greg Roumeliotis and Leslie Adler

Exclusive: Trump's social media venture seeks $1 billion raise - sources | Reuters

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