Anticipated to Price IPO Tonight.
Novus Capital Corp. (NOVSU), filed an amended S-1 this morning, further revising the terms of their IPO. In Novus Capital’s initial filing, this was a 1/2 warrant, 24 months deal. Subsequent to that, those terms were revised to 21 months and 3/4 of a warrant. As of this morning, NOVSU is now 18 months with a full warrant included in it’s unit.
To add additional fuel to the terms fire, GigCapital3 (GIK.U) debuted today and even though Gig3 IPO’d with $10.10 in trust, 3/4 of a warrant and 18 months, it still opened at $9.90. This is in stark contrast to Jaws Acquisition Corp (JWS.U), which also debuted today, and is currently trading at $10.15.
It begs the question…do investors only want to buy the tier-1, brand name IPOs? Social Capital II is currently trading at $10.52, Social Capital III, at $10.39. CC Neuberger, at $10.14, and Jaws at $10.15. These are all high-profile SPACs, led by well known names, and as you can see below, these are the only SPACs to be trading significantly above $10.00 (of the SPACs that have IPO’d since the Covid-19 crisis). Furthermore, Jaws did not need to revise its terms at all.
It’s a big signal when Gig3 overfunds its trust at $10.10 and it still can’t trade above issue price at IPO. And that’s a big problem for the rest of the sub-elite SPACs looking to IPO going forward because now it’s going to be even more challenging to get enough indications to cover a book.
So as was previously theorized, there appears to be a Darwinian “Survival of the Fittest” happening where only the elite deals are able to IPO. That’s not to say we’re totally there yet, but there’s going to be a lot riding on Novus Capital’s day-one performance tomorrow. If Novus breaks issue price too, it will get increasingly harder for the rest of the field to get the indications they need when investors can just buy in the secondary market below $10.00.
Let’s see what happens.
Revised summary of terms below:
With the passage this weekend of $95 billion in funding for Ukraine, Israel and Taiwan by the House of Representatives, some focus has gone back towards the defense sector, which has generally had a good year as a whole. But, SPACs have not been as active in defense, despite the fact that companies in the...
At the SPAC of Dawn As April’s sleepy month for SPAC news continues, there is only one special meeting on the docket to consider a SPAC deal approval, that being today’s vote on Pegasus Digital Mobility‘s (NYSE:PGSS) combination with equipment manufacturer Schmid. Three more SPACs are facing extension votes this week, including Pyrophyte (NYSE:PHYT), whose...
Terms Tracker for the Week Ending April 19, 2024 Welcome to our weekly column where we discuss the findings from our IPO terms tracker based on the previous week’s pricings. Passover and school spring break starts next week, which most likely means a slowdown in SPAC filing activity. Although Churchill IX is now rumored to...
Despite a week of general pull-backs in the market, fintech firm Ibotta (NYSE:IBTA) nonetheless took the dive and had a good week debuting via a traditional IPO in the choppy waters. The company, which provides app-based consumer cashback discounts on purchases, priced its IPO at $88, above its proposed range of $76 to $84, and...
At the SPAC of Dawn Happy Friday! SPACInsider has unveiled new presets on SPAC Performance accessible via the Data drop-down to easily sort for the highest and lowest performing active SPACs and de-SPACs. On the de-SPAC side, Vertiv (NYSE:VRT) continues to be well ahead of the pack, logging a 710% return by share price adjusted...