SUBSPAC

The Daily Dish (8/04/21)

Nikola Cuts Delivery Outlook

EV truck startup Nikola, which recently went public through a SPAC Merger, warned that supply chain constraints were causing various delays in production. As a result, the company is slashing its vehicle delivery production in half.

Nikola is still in pre-production and expects to produce 25 to 50 units of its electric semi trucks this year compared to its original estimate of 50 to 100 trucks. 

The company reported a net loss of $143 million in the second quarter, which is up from $115.7 million loss in the same period last year. At the end of the second quarter, Nikola had cash balance of $632.6 million.

While the company focused its earnings call on progress towards producing electric trucks, the market was more interested in the company’s earnings revision and the effects of its founder Trevor Milton being charged with securities fraud. 

The company has built 14-pre production vehicles, five alpha and nine beta prototypes so far. Milton was charged on July 29th with two counts of securities fraud and wire fraud by a federal grand jury. 


Chicago Based Healthcare SPAC Raises $250 Million 

Healthwell Acquisition, a Chicago based SPAC looking for targets in healthcare has raised $250 million in its IPO.

The SPAC is led by healthcare executive Alyssa Rapp, who previously led private equity backed Surgical Solutions. 

Healthwell’s board includes former Playboy Enterprise CEO Christie Hefner and Delloite senior executive Carl Allegretti.

The SPAC is looking at targets in healthcare technology, tech-enabled healthcare services and tech-enabled wellness. 


Immunovant Stock Drops 36% As SPAC Deal Collapses 

Shares of clinical-stage biopharma company Immunovant plunged as much as 36% this week as its SPAC deal imploded. Drugmaker Roviant Sciences had been planning to use the proceeds from its own SPAC to take over Immunovant, a former subsidiary which had gone public through a SPAC merger in 2019.

The deal collapsed on Monday after Roviant announced that it would simply go public through an SPAC merger without any other manoeuvres. Instead of taking over Immunovant, the company plans to invest $200 million through stock purchases. 

The amended deal sent Immunovant stock tumbling to $7, with the shares seeing a 86% drop since last year. Immunovant believes that it can use the $200 million investment from Roviant towards drug development in the future.

Exotic SPAC deals have received regulatory scrutiny in recent weeks with investor Bill Ackman dropping plans to use his SPAC to buy shares in Universal Music Group. 


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