Kernel Group Holdings (NASDAQ:BIOT) announced in an 8-K that it has agreed to sell most of its sponsor economics and undergo a management change.
VKSS Capital is coming in to purchase 7,187,500 of the sponsor’s promote shares (94.3%) at par value $0.0001 per share, leaving the original sponsor 431,250 remaining. VKSS is also purchasing all 8,750,000 of Kernel sponsor’s private placement warrants for an aggregate purchase price of $1.
The larger piece of compensation going Kernel’s way is in the form of 2,000,000 promote shares to be distributed to members of the original sponsor pro rata. Four members of the original sponsor – CEO Mark Gross, CFO Rakesh Tondon, COO Brett Northart, and Chief Administrative Officer Mike Newbold – are also to receive a payment of $250,000 and 125,000 promote shares each as an advisor fee.
Taking their place are newly appointed Chairman and CEO Surendra Ajjarapu and CFO Howard Doss as well as four other new Board members.
Both men are recent SPAC veterans and they serve in the same roles leading Aesther Healthcare Acquisition Corp. (NASDAQ:AEHA), which is working to close a combination with Ocean Biomedical.
Ajjarapu is also a director of OceanTech Acquisition I Corp. (NASDAQ:OTEC), which terminated an earlier deal with Captura Biopharma and is now working to close its combination with Indian fintech Majic Wheels (OTC:MJWL).
The pair of executives have also collaborated in these same roles at Txrade Group (NASDAQ:MEDS) a microcap online marketplace for pharmaceuticals. This expertise would indicate that the new SPAC team will shift focus to biopharm from Kernel’s initial hunt in the supply chain technology space, but incoming Board appointees also have some EV and renewable energy experience.
They are getting behind the wheel of a SPAC vehicle that IPO’d in Februrary 2021 with 1/2 warrants in its units and no overfunding of its trust – terms that would be difficult to finagle in the current market environment. But, Kernel is also heading towards its initial transaction deadline on February 5.
So, the incoming management will likely have to get through an extension to keep the ride going, while the original management has secured some upside while dodging the extension hassle.
Terms Tracker for the Week Ending March 7, 2025 Welcome to our weekly column where we discuss the findings from our IPO terms tracker based on the previous week’s pricings. It was an extremely quiet week on the SPAC front with no IPOs pricing, but there were three new S-1 filings. There was also only...
At the SPAC of Dawn If things seem like they are accelerating fast to start 2025, that is even more so for the space sector, which had a big, and occasionally explosive, week this week. 2023 de-SPAC Intuitive Machines (NASDAQ:LUNR) landed on the moon a second time yesterday afternoon, but it may have seen its...
At the SPAC of Dawn SPACs have largely steered clear of the fintech sector, which used to be among its favorite hunting grounds of late, both due to unfavorable macro pressures and the lack of clear action on the traditional IPO side to comp to. That may soon change as buy-now-pay-later firm Klarna has confidentially...
At the SPAC of Dawn Stock market whip saws based on US government action are not likely going anywhere as President Donald Trump conceded “a little disturbance” is coming to the economy in a speech before a joint session of Congress. This pain in the short term is to be primarily the result of the...
Cal Redwood Acquisition Corp. has filed for a $200 million SPAC IPO, aiming to focus on opportunities in the TMT (Technology, Media, and Telecommunications) sector. The blank-check company intends to list on the Nasdaq under the symbol “CRAU”, offering 20,000,000 units at $10.00 each, with the trust funded at 100%. The unit structure includes a...