Liberty Media Acquisition Corp. (Nasdaq: LMAC) filed a proxy this afternoon for a shareholder vote to liquidate early. Liberty Media’s current completion deadline is January 26, 2023, but today’s filing is asking shareholders to approve an amendment that would allow the Board to change the date to no later than December 30, 2022.
As has been cited by many teams this year, Liberty Media noted in a press release, “…a declining IPO market in 2022, and significant public and private market volatility, which have prevented the Company from securing an opportunity that it believes will offer a compelling return on investment for its stockholders.” Liberty Media also stated that they had evaluated over 140 target companies since its IPO on January 23, 2021.
Interestingly, Liberty Media also explicitly referenced the “recent changes in U.S. tax law” as the reason to move up its completion deadline so it could liquidate early. This is a direct reference to the recent 1% excise tax on share buybacks that was included in the Climate Change Bill that was passed in early August (also named the “Inflation Reduction Act”). Crucible Acquisition Corp. (NYSE: CRU) recently filed to do something similar, and while CRU did not make mention of the excise tax in its 8-k, it is implied given that its current completion deadline is January 7, 2023.
These moves are not unexpected and there should be additional teams looking to do the same given the strong economic headwinds combined with a 2023 SPAC expiration date and additional tax bill. Look for an increase in the coming months of SPACs looking to terminate early by vote as well.
In the meantime, Liberty Media has set a record date of October 3, 2022. As a result, the vote will most likely be held in late October or early November.
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