The Week In SPAC News: Ligand To Spin-Off OmniAb Business Via SPAC Merger

ImmunoPrecise Antibodies Ltd subsidiary Talem Therapeutics inks deal with  Ligand Pharmaceuticals for OmniAb platform

In SPAC news this week, Ligand announced plans to spin off the company’s OmniAb business through a merger with Avista Public Acquisition. Meanwhile, HUB Security is also going public through a deal with Mount Rainier Acquisition.

Ligand to Spin-Off OmniAb Business

Ligand Pharmaceuticals (LGND) announced the signing of a definitive merger agreement with Avista Public Acquisition Corp. II (AHPA), a publicly-traded special purpose acquisition company providing for the spin-off of OmniAb, Ligand’s antibody discovery business, immediately followed by a merger with a newly formed subsidiary of APAC.

The combined company will be led by Ligand’s President, Matt Foehr, and will be renamed Omni Ab. Upon the closing of the transaction, Avista Capital Partners, APAC’s sponsor and a leading private equity firm focused on the healthcare industry, has agreed to invest up to $115 million in the combined company, and Ligand will contribute $15 million. The combined company will have an initial pre-money equity valuation of $850 million.

The transaction will be effected through a “Reverse Morris Trust” transaction according to which OmniAb will be spun-off to Ligand’s shareholders and simultaneously merged as a subsidiary of APAC. The transaction is expected to be tax-free to Ligand and its shareholders for U.S. federal income tax purposes, except for cash received in place of fractional shares.

Upon the closing of the transaction, Ligand shareholders are expected to own approximately 75% to 84% of the combined company, depending on redemptions, which will be listed on the Nasdaq Global Markets under the ticker symbol ‘OABI.’ The transaction is expected to close in the second half of 2022.

Viyi Algo, Venus Acquisition Corporation(VENA)Merger

Viyi Algo, the central processing algorithm leader, has captured 5% of the market share of central processing algorithm services provided to the Internet advertising and online gaming acceleration industries as of 2020.

Viyi Algo is dedicated to developing and delivering central processing algorithm solutions to customers engaged in Internet advertising and gaming and smart chips. Viyi Algo’s customer base is growing rapidly due to the general demand for more efficient data processing across industries as a result of the growing Internet population and the popularity of AI. According to the CIC report, revenue from central processing algorithm services generated by Internet advertising and online gaming alone grows from RMB 2.2 billion in 2016 to RMB 6.9 billion in 2020, representing a CAGR of 32.7%. The market is expected to maintain its rapid growth trend, growing at a CAGR of 15% between 2020 and 2025.

Viyi Algo’s revenue is primarily derived from (i) central processing algorithm services for the Internet advertising and Internet gaming industries, and (ii) smart chips and services, including software development.

The proposed business combination has been unanimously approved by the Board of Directors of Venus Acquisition Corporation and the Board of Directors of Viyi Algo and is expected to be completed in the First Half of 2022.

HUB Security to Become Publicly Traded

HUB Cyber Security, a Tel-Aviv-based developer of Confidential Computing cybersecurity solutions and services, and Mount Rainier Acquisition Corp. (RNER), a U.S. publicly traded special purpose acquisition company, announced that they have entered into a definitive business combination agreement.

Upon closing of the proposed transaction, the combined company will operate under the “HUB Security” name and is expected to be listed on Nasdaq under the new ticker symbol ‘HUBC.’ The combined company will have an estimated pro forma enterprise value of approximately $1.28 billion.

HUB shareholders will retain 100% of their existing equity holdings and are expected to own approximately 81% of the combined company on a non-fully diluted basis immediately following the closing of the proposed transaction, assuming no redemptions by Mount Rainier Acquisition Corp.’s public stockholders. The proposed transaction is expected to close in the third quarter of 2022.

Lanvin Group Going Public

Lanvin Group, a global luxury fashion group, and Primavera Capital Acquisition (PV) announced they have entered into a definitive business combination agreement that is expected to list Lanvin Group on the New York Stock Exchange under the ticker symbol ‘LANV.’

PV is a special purpose acquisition company listed on The New York Stock Exchange and is also an affiliate of Primavera Capital, a global investment firm with over $17B of assets under management. The transaction values Lanvin Group at a pro forma enterprise value of $1.5 billion, with a combined pro forma equity value of up to $1.9 billion.

Thunder Bridge, Coincheck Merger

Coincheck and Thunder Bridge Capital Partners IV, Inc. (THCP), a special purpose acquisition company, announced they have entered into a definitive agreement for a business combination that would result in the combined entity being a publicly listed holding company, domiciled in the Netherlands, with Coincheck as its wholly-owned subsidiary.

Upon closing of the transaction, the resulting holding company will be named Coincheck Group and expects to be listed on the Nasdaq Global Select Market under the ticker symbol ‘CNCK.’

Headquartered in Tokyo, Coincheck operates one of the largest multi-cryptocurrency marketplaces and digital asset exchanges in Japan and is regulated by Japan’s Financial Services Agency.

Coincheck is a leader in the Japanese cryptocurrency industry, operating a platform with the largest number and most diverse array of coins in Japan. Coincheck is increasing Japanese customers’ access to innovative digital products and solutions beyond cryptocurrencies and seeks to unlock the ability of Japanese customers and institutions to transact and establish a presence in this rapidly-growing market.

The proposed transaction represents a transaction value of approximately $1.25 billion.

Tailwind Two Acquisition, Terrain Orbital Combination

Tailwind Two Acquisition Corp. (TWNT), a publicly-traded special purpose acquisition company, announced that shareholders of record as of Feb. 4 approved the previously announced business combination with Terran Orbital Corporation, a small satellite manufacturer primarily serving the United States aerospace and defense industry, supported by over 94% of the shares of Tailwind Two voted at the extraordinary general meeting of shareholders held on March 22.

Under the business combination, at the closing, Terran Orbital will combine with Tailwind Two and the combined company’s name will be Terran Orbital. Following the closing, Terran Orbital’s common stock and warrants are expected to trade on the New York Stock Exchange under the ticker symbols ‘LLAP’ and ‘LLAPWS,’ respectively.

Analyst Coverage

On March 23, Northland analyst Michael Latimore initiated coverage of Global SPAC Partners (GLSPU) – which has entered into a business combination agreement to bring Gorilla Technology public – with an Outperform rating and $13 price target.

The combined company will be called Gorilla and is expected to be publicly listed on Nasdaq under the symbol ‘GRRR’ following the closing of the transaction, which is expected late in the first quarter of 2022. Gorilla Technology is a provider of visual edge AI technologies that help companies and governments automate the recognition of people and vehicles and their actions, Latimore noted.

On March 21, Northland analyst Tim Chiang initiated coverage of Oaktree Acquisition Corp. II (OACB) – which has announced a deal to merge with biosimilars-focused biotech company Alvotech – with an Outperform rating and $15 price target. Alvotech, founded in 2013 in Iceland, is a vertically integrated platform company focused exclusively on developing and manufacturing biosimilar medicines.

The combined company’s securities are expected to be traded on NASDAQ under the symbol ‘ALVO.’ Alvotech’s lead pipeline candidate, AVT02 is a biosimilar to AbbVie’s (ABBV) Humira, the best selling drug in the U.S., and a July 2023 launch is expected to occur with Alvotech recently settling its legal dispute with AbbVie, Chiang told investors.

SPAC IPOs This Week

RF Acquisition (RFAC) opened on March 24 at $10.04. “We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target concerning an initial business combination with us,” the company said.