SUBSPAC

The Daily Dish (08/17/21)

Forbes in Talks with Magnum Opus for SPAC Merger 

Forbes Media is in talks with Magnum Opus Acquisition to go public through a SPAC merger later this year. The deal is expected to value the company at $650 million and would scuttle earlier talks with a consortium led by Michael Moe’s GSV asset management.

That transaction would have meant that Forbes would remain a private company and was valued at over $600 Million.

The company’s brand now has a reach of more than 140 million people worldwide and produces 32 licences local editions in 71 countries.

In 2014, Hong-Kong based Integrated Whale Media Investments, acquired a majority stake in a deal that valued the company at $475 Million, with the founding family retaining a minority stake. Magnum Opus raised $200 Million in an IPO in March to look for companies in consumer, technology or media sectors with disruptive growth potential. 


PSTH Gets Sued 

Pershing Square Tontine Holdings got sued today in a case that could have far-reaching implications for SPACs. The case contends that Bill Ackman’s SPAC isn’t an operating company, but is an investment company like Ackman’s funds and should be regulated by the Investment Company Act of 1940.

If SPACs were regulated as investment companies, much of the industry could be impacted as it would make it harder for anyone in the investment business to participate in a SPAC.

Some analysts are saying that the implications of this lawsuit could be devastating for the SPAC industry.

The lawsuit argues that simply buying some stock is not what a SPAC is meant to do. Despite this, Ackman negotiated a stock deal between his SPAC and Universal Music Group. The arrangement was complicated, with PSTH acquiring a 10% stake in UMG for $4 Billion, which raised concerns that Ackman’s SPAC was not a SPAC at all.


Aurora Estimates Fair Value of its Stock at $21 

Self Driving startup Aurora estimates that its stock is worth $21 when it goes public through a SPAC merger later this year. The disclosure comes from Reinvent Technology Partners as the SPAC posted a document for Aurora employees and shareholders addressing their questions.

The filing from the SEC states that the deal is expected to close in the fourth quarter and would mean that employees cannot sell or transfer shares within the first 180 days after listing.

Aurora was founded in 2017 and plans to launch its autonomous tech first in trucking and then in ride hailing applications. The company has 1600 employees and has offices in Dallas, Seattle, Montana, Louisville, Colorado, Wixom, Michigan and the Bay Area. 


Seth Klarman Has Nearly $900 Million in SPACs 

“Value investing” guru Seth Klarman is trading in his value investing style for a high growth SPACs. Billionaire investor Seth Klarman has nearly $900 million invested in SPACs through his Hedge Fund Baupost Group.

Klarman is often nicknamed ‘the next Warren Buffet’ as he has embraced a value investing style for decades.

But his increased interest in high growth SPACs showcase a change of pace for the investor.

Despite increasing his stake in several SPACs, Klarman is now trimming his stake in one high profile SPAC. According to a recent SEC filing, Baupost has slashed its stake in PSTH by 20% in the second quarter. 


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