On Friday evening, Silver Spike Acquisition Corp. (SSPKU), filed for a $250 million IPO focused on the Cannabis sector. Scott Gordon, who is the founder and Chief Executive Officer of Silver Spike Capital, a newly formed investment platform dedicated to the cannabis industry, will be leading Silver Spike (the SPAC) as CEO and Chairman.
Silver Spike has an interesting name, as do many SPACs (Hedosophia, anyone?), so a quick Google search led me to the “Nevada Silver Spike“. The “Silver Spike” was on of four ceremonial railroad ties that were driven at the connection linking the Central Pacific and the Union Pacific railroads, creating the first transcontinental railroad. The Iron Spike of the East, the Gold Spike of the West, a hybrid Iron-Silver-Gold Spike, and a Silver Spike to wed them all together. Maybe this SPAC’s name means something else entirely, but if this is the origin story, it’s rather poetic. Maybe the Silver Spike SPAC will link the entire country in a Federally legalized cannabis utopia.
Names aside, this SPAC shows a fairly standard $250 million, 1/2 warrant, 24 months structure, which we’ve seen so frequently this year. Nothing fancy. Credit Suisse is on a roll though. They were recently left lead on both SC Health ($150 million) and Oaktree ($175 million), so Silver Spike, at $250 million, means Credit Suisse has $575 million in total underwritings already for the third quarter. The league tables should be quite interesting come September.
Additionally, this team doesn’t have any Directors listed yet (should be dropped in in the next filing), but this team looks to have a solid “Street” background. Mr. Gordon, the CEO and Chairman of Silver Spike, was previously President of Fintech Advisory Inc., an investment manager for a multi-billion dollar family office fund, as well as a Portfolio Manager at Taconic Capital Advisors, among other things. William Healy, President of Silver Spike, was previously President of Pantera Capital Management, an investment management company. The other two team members, Greg Gentile and Mohammed Grimeh, were Chief Executive Officer of GMG Investment Advisors, LLC and deputy Global Head Fixed Income at Millennium Management, respectively. So this team isn’t just comprised of “weed operators”, they’ve got the financial chops.
Finally, cannabis is hot (smoking hot?). There is undoubtedly going to be tremendous demand for this SPAC and the 1/2 warrant makes this even more palatable. Look for this one to price mid-August.
Summary of terms below:
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