The Daily Dish (2/19/21)
Welcome to the Daily Dish. Every morning in your inbox subscribers receive some Dishes that we find interesting and we think that you should know more about.
We’ll try to lob ‘em up to you in a simple, clean format that you can read in 5 minutes before the market opens. (Trust me, we know what it’s like to wake up at 9:23am).
Here’s the first assist 👇
Hong Kong billionaire Richard Li is considering setting up a third special purpose acquisition company in the U.S., according to people with knowledge of the matter.
Li and tech mogul Peter Thiel have raised about $900 million via two U.S.-listed SPACs under the Bridgetown brand. Thiel will not be involved in the third deal, the people said, asking not to be identified because the information is private. The new SPAC could raise a few hundred million dollars, one of the people said.
Considerations are at an early stage and there’s no final decision on the size of the deal, the people said. A representative for Li declined to comment.
A SPAC or blank-check company is a shell company that raises money from public investors with the goal of acquiring a business within two years. These deals have raised more than $48 billion in the U.S. alone just this year, according to data compiled by Bloomberg.
Bridgetown’s first vehicle was in early talks to take Indonesia’s e-commerce giant PT Tokopedia public in a deal that could value the combined company at $10 billion, Bloomberg News reported in December. The SPAC raised almost $600 million in October.
Bridgetown 2 Holdings Ltd. began trading last month after raising nearly $300 million.
New Vista Acquisition Corp., the special purpose acquisition company (SPAC) chaired by former Boeing CEO Dennis Muilenburg, began trading on the Nasdaq on Feb. 17 to a positive reception after raising $240 million to target and bring public an aerospace company developing emerging technology. The units are listed on the Nasdaq under the ticker symbol “NVSAU.” Each unit consists of one Class A ordinary share and one-third of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment.
In addition to Muilenberg, who was fired from Boeing for his handling of the 737 MAX crisis, the SPAC is led by investors Kirsten Bartok Touw of AirFinance and Travis Nelson of Eclipse Investors, who serve as co-presidents. Several other known players in the eVTOL space have been named as advisors, including Paul Eremenko, chairman and CEO of Universal Hydrogen; Gur Kimchi, co-founder of Amazon Prime Air; and Wyatt Smith, former head of business development at Uber Elevate.
SPACs are rapidly emerging as a popular way for eVTOL developers and associated companies in the AAM space to go public. Last week, the electric air taxi developer Archer announced it will merge with the SPAC Atlas Crest Investment Corp. in a deal expected to provide $1.1 billion in gross proceeds, valuing the startup at $3.8 billion post-money.
Meanwhile, Joby Aviation is reportedly close to a deal to go public via a merger with Reinvent Technology Partners, and Lilium is also said to be in discussions with SPACs. The helicopter booking service Blade Urban Air Mobility announced a SPAC deal with Experience Investment Corp. in December, telling investors that it aims to transition to eVTOL aircraft starting in 2025.
Owlet Baby Care, the maker of connected infant-monitoring products targeted at consumers, today announced its plans to merge with Sandbridge Acquisition Corporation $SBG, a special purpose acquisition company (SPAC) backed by Sandbridge Capital and PIMCO private funds, and to begin trading on the NYSE.
The deal is expected to close during Q2 2021, subject to stockholder approval, and will deliver as much as $325 million to the combined company through cash ($230 million) and concurrent private placement (PIPE) of common stock ($130 million).
Headlining the company’s brand is the Owlet Smart Sock, a connected wellness wearable that uses pulse oximetry to track a baby’s oxygen levels and heart rate during sleep. The company has combined this with the Owlet Cam, a WiFi-connected 1080p video camera baby monitor, and an app interface that parents can use to watch their child or to receive automatic alerts.
Owlet also sells an app-based healthy sleep program called Dream Lab, and is building up to the release of a pregnancy-band wearable for expecting mothers.
In their initial slide deck, Owlet is reporting a 2019 net revenue of $49.8 million with a 46% gross margin, and estimates that 2020’s numbers will land at $75.2 million and 47.5%, representing 51% year-over-year growth. Go a few years further down the timeline, and the company said that it is hoping to reach a net revenue of up to $1.06 billion by 2025.
However, the company noted that its limited operating history includes net losses, and that it currently relies on sales of the Smart Sock “for the majority of our revenue and expect to continue to do so for the foreseeable future.”
If you enjoyed today’s dish please gift it to a friend (or a baby) 👇
There’s No I In Trade
My goal is to create a community where people can educate themselves through the world of investing. I can’t do that alone, we need to build this community together. So tell me what you’re loving, tell me what you want to see more of tomorrow.