Global Blockchain (NASDAQ:GBBK) has entered into a definitive agreement to combine with wealth management firm Cardea at an enterprise value of $175 million.
Atlanta-based Cardea provides wealth and asset management services to high-net-worth individuals, institutions and families with a specialization in cross-border advisory services.
The combined company is expected to trade on the Nasdaq once the deal is completed in the first quarter of 2024.
Transaction Overview
Global Blockchain has about $25.4 million in its current trust having just gone through an extension vote that left its trust reduced by 85.9%, but with the ability to extend up to May 12, 2024.
Cardea is to receive a number of shares implied by the $175 million enterprise value adjusted by its closing cash, debt and unpaid transaction expenses. Global Blockchain must receive a fairness opinion for Cardea’s valuation in order for the deal to close.
The parties have not yet filed their merger documents or an investor presentation, but Global Blockchain’s profile page will be updated once more information is made available.
Quick Takes: With this target, Global Blockchain is taking a slight detour from the blockchain-enabled businesses it sought out at IPO to a more traditional financial services play.
Cardea provides many straight-forward services but aside from having a cross-border bent to their business, they have dipped into several other niches as well. The firm also offers alternative investments including impact investing and other bespoke products.
The company forms its investment portfolios through an open infrastructure that allows clients to set their own asset allocation parameters and monitor their holdings while seeing new alternative and sustainable investment opportunities as they come available.
Much of this infrastructure has been put together as a result of a string of strategic acquisitions, and continuing that strategy appears to be the primary impetus for Cardea to go public. Its press release notes that proceeds will go towards integrating new innovations to its existing portfolio of acquisitions.
And, while it may swim in somewhat more traditional waters for now, Global Blockchain aims to apply some of its expertise post-merger to help the company get into blockchain, AI and tokenized assets to add to its alternative services.
There could be synergies for such an endeavor within the SPAC sponsor’s own portfolio. Global Blockchain Ventures backs the SPAC and it currently has 18 portfolio companies, the majority of which have generated their own tokens, cryptocurrencies, NFTs, and other digital assets.
The SPAC’s CEO Dr. Max Hooper has been a long-time theorist as well as an investor with the goal of mainstreaming blockchain. Its Board also includes Chris Ensey who formerly served as CEO and COO of Riot Blockchain.
If that ultimately is the play that Global Blockchain has in mind, it is perhaps a sensible one.
Crypto companies have come under increasing scrutiny over the past year, particularly following several high-profile collapses. For SPACs, that has typically meant longer review processes with the SEC for targets doing anything more complicated with crypto than mining it or selling out of an ATM.
With that in mind, Global Blockchain may have decided that it would be easier to partner with a crypto-curious, but otherwise traditional financial services player and guide them into that world over time rather than a company with active crypto operations in progress.
Regardless of what is to come following the deal’s close, at announcement, Cardea’s closest comp among recent de-SPACs would be AlTi Global (NASDAQ:ALTI), which Cartesian Growth took public in November 2022. It is an international wealth management firm that has similarly focused on alternative investments.
It last closed at $7.77, but hit a high of $28.49 within the past 52 weeks and generally trades at about 3.9x revenue.
On a larger scale, Altimar combined asset managers Owl Rock and Dyal Capital in May 2021 to form Blue Owl (NYSE:OWL). It last closed at $11.16 with a $15.3 billion market cap and trades at 4.4x revenue and about 15.5x EBITDA.
ADVISORS
- Company
- Ellenoff Grossman & Schole LLP is serving as U.S. legal counsel.
- SPAC
- ArentFox Schiff LLP is serving as legal advisor.
Kochav Defense Acquisition Corp. (NASDAQ:KCHVU) has filed for a $220 million SPAC to bring Israeli defense sector experience to a hunt for a target in that growing business sphere. The new SPAC is not over-funded and offers one right to a 1/7 share in each unit. It will have 18 months to initially close a deal,...
Columbus Circle I (NASDAQ:CCCMU) has filed for a $200 million SPAC to serve as an in-house SPAC led by underwriter Cohen & Company. The new SPAC is to have 24 months on its initial clock with a 1/2 warrant in each unit and will not over-fund its trust, instead including $10.00 per unit in the account...
At the SPAC of Dawn This week is set to be busy for SPACs at both ends of their processes as four SPACs are seeking to price their IPOs in the first two days of the week while six SPACs that are already trading have scheduled votes clustered on Wednesday and Friday. Distoken (NASDAQ:DIST) and...
Terms Tracker for the Week Ending April 25, 2025 Welcome to our weekly column where we discuss the findings from our IPO terms tracker based on the previous week’s pricings. Everybody’s back in the pool. Two more SPACs filed this week while four others priced their IPOs. Additionally five SPACs announced their combinations, breaking the...
At the SPAC of Dawn After a cheery string of good news indicators, futures remain green heading into the final trading session of the week. The final reading for consumer sentiments is to come at about 10 am, which will hopefully match the market’s recent mood. There is some time delay on this indicator, however,...