Atlantic Coastal (NASDAQ:ACAH) announced this morning that it and additive manufacturing firm Essentium have mutually agreed to terminate their business combination.
The press release did not provide much detail on the termination, but cited market conditions were unfavorable. Blake Teipel, CEO of Essentium, commented that they “are disappointed that market conditions prevented the parties from consummating this agreement” and will continue to “leverage the strength of additive manufacturing technology and product system validated by the Department of Defense to continue to advance additive manufacturing globally.”
The parties have agreed that Atlantic Coastal will be granted the right to receive payments subject to circumstances relating to the consummation of future financing transactions by Essentium, a sale of Essentium, or Atlantic Coastal’s inability to consummate a business combination. The parties have also agreed that if Essentium does not make a sale by March 8, 2023, then it will have to deliver a warrant to Atlantic Coastal to acquire a stake equal to five percent at an implied valuation equal to $500 million.
Atlantic Coastal planned on bringing about $345 million into the deal from its current trust supplemented by a $42 million PIPE. The PIPE drew participation from strategic and institutional investors including chemical conglomerate BASF (DE:BASF), Atalaya Capital Management and Apeiron Investment Group.
An affiliate of Atlantic Coastal’s sponsor initially funded its $20 million participation in the PIPE with a term loan from Cantor Fitzgerald secured by 8,425,000 Class A shares and 2,000,000 more as collateral. Atalaya Capital Management further supported the deal with a forward purchase agreement (FPA) which was supposed to see 10,000,000 shares, or enough to equal a 9.9% stake, if lesser, at close.
Going forward, Atlantic Coastal will focus its efforts on “identifying a next-generation mobility target with access to unique opportunities”. The SPAC still has plenty of time for a second try with its transaction deadline not coming until March 8, 2023.
Atlantic Coastal initially announced its $974 million combination with Essentium not too long ago on December 1. College Station, Texas-based Essentium provides machines that can remotely print tools and parts for the defense sector as well as a variety of civilian clients.
Remember the metaverse? Many do not. Meta’s (NASDAQ:META) attempted transition to virtually living and working seemed to mark a trend that went up and down quickly, but one SPAC deal has both survived that roller coaster and may rise with a second. Back in December 2022, Newbury Street (NASDAQ:NBST) announced a $1.85 billion combination with...
At the SPAC of Dawn Tucked into the bill that provides $95 billion in funding to American allies passed by the House this weekend is another measure that is likely to have far more impact on at least one pending deal in SPAC world. It would appear that the timing was fortuitous for TikTok rival...
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...