Leo Holdings Corp. (LHC), which is headed for an extension vote on February 11th, filed an 8-K this morning providing information on a potential target they are in discussions with for a combination. These were termed “advanced discussions”, but it sounds like regardless of how far along they are in the process, they won’t be able to get a definitive agreement on file ahead of their shareholder vote to extend. As such, they are only able to provide some headline details about the company.
Those headline details are that this is a “high-growth, technology-enabled business capitalizing on the secular shift of advertising dollars from traditional offline channels to online digital channels by helping connect consumers and advertisers with innovative marketplace solutions. Leo believes that the target’s financial profile is compelling with significant historical revenue growth, expected revenue growth for 2020 of 30% and strong EBITDA margins and cash conversion.” Additionally, the EV/EBITDA multiple is expected to be 13 time fiscal year 2020 expected EBITDA.
So what can we glean from this new information. For one, it sounds like Leo Holdings Corp. would like to hang on to their cash in trust, otherwise they wouldn’t have put this information out hoping to pique the interest of investors. If you recall, LHC is not offering any contribution to trust for non-redeeming shareholders and they are asking for an additional five and a half months. Typically in those situations, no contribution and a long extension means a SPAC is either trying to reduce their trust value to accommodate a smaller than anticipated target, or they want to replace the cash in trust with a PIPE. However, in LHC’s case, by providing detail on a pending announcement ahead of their vote, they’re trying to signal “you should reconsider if you were planning on redeeming”. Nebula was facing similar circumstances, but managed to squeak in their transaction announcement a few days ahead of their extension vote.
However, there’s no guarantee that these advanced talks will lead to a definitive agreement, so it’s a bit of a risk for investors. Plus, without being able to drill down on all the details, it’s hard to say if LHC’s deal will be a real winner. Or, if there’s a PIPE involved and at we don’t know at what price. However, the 8-K certainly is intriguing. The question is, is it intriguing enough to protect their cash in trust? We have two weeks to find out, but maybe LHC will manage to move the discussions far enough along that we get a real announcement ahead of their vote.


Exciting new things are coming for SPACInsider subscribers, and some have already arrived! This summer, SPACInsider is unveiling the SPACInsider Alerts App on iOS with an Android launch soon to follow. The app allows subscribers to stay ahead of the SPAC market with real-time, customizable filing alerts with instant notifications landing the moment that a...
At the SPAC of Dawn Futures are largely green with the CPI reading coming up, and several SPACs and de-SPACs have cause to feel bullish regardless of what the reading states. Pharma and beauty company Longevity Health (NASDAQ:XAGE) announced it will acquire plasma collection firm True Health ahead of market open in news that has...
Silver Pegasus Acquisition Corp. (NASDAQ:SPEGU) announced the pricing of its $100 million IPO and its units are expected to begin trading on the Nasdaq under the symbol “SPEGU”, Tuesday, July 15, 2025. The new SPAC plans to search within the technology sector, with a focus on semiconductors and systems solutions. Silver Pegasus Acquisition Corp.’s management...
Cayson Acquisition Corp. (NASDAQ:CAPN) has entered into a definitive agreement to combine with boutique investment firm Mango Financial for $300 million in equity consideration. Hong Kong-based Mango provides a range of M&A and equity capital markets advisory services to clients considering listings in China and the US. The combined company is expected to trade on...
Trailblazer (NASDAQ:BLZRU) has filed for a $200 million SPAC to bring a first-time team to market with serial sponsor terms. The new SPAC is offering investors a 1/3 warrant in each unit and it is the first SPAC filed so far this month with 24 months on its initial transaction clock. All other July SPACs...