AI firm Brand Engagement Network to go public via SPAC deal -sources

Brand Engagement Network

07/09/2023 21:30

By Echo Wang
       NEW YORK, Sept 7 (Reuters) - Artificial intelligence
startup Brand Engagement Network (BEN) has agreed to go public
through a merger with a blank check acquisition company in a
deal valuing the combined company at $358 million, according to
people familiar with the matter.
    The deal with DHC Acquisition Corp  DHCA.O , which is
expected to be announced on Thursday, will provide Brand
Engagement Network with about $40 million in gross proceeds, the
sources said, adding that the funds will be used mostly for
product development and future acquisitions. 
    The deal comes as the rise of ChatGPT this year has led to a
flurry of investments in AI-focused ventures and startups, even
as the wider funding environment remains challenging in an
uncertain economy.
    Artificial intelligence and machine learning startups
globally have raised about $39.4 billion so far this year,
according to PitchBook.
    Headquartered in Jackson, Wyoming, Brand Engagement Network
is a provider of AI-powered chatbots and conversational AI
technology to companies in industries like automotive,
healthcare, and customer service. Brand Engagement Network's AI
offerings help companies with services, including data leakage
prevention and identity verification. 
    DHC Acquisition Corp, a special purpose acquisition company
(SPAC) which raised $309 million through its initial public
offering in 2021, cut the size of its offering to $47 million
earlier this year after securing an extension of its life from
shareholders.  
    SPACs are shell companies that raise money in an initial
public offering and put it in a trust for the purpose of merging
with a private company and taking it public. SPACs typically
have up to two years from the time they list their shares to
close a merger.
    Since investors are unaware of the target company ahead of
the IPO, SPACs often grant them the right to redeem their
initial investment as an incentive to put their money in the
trust.
    After the deal closes, the combined company will be named
BEN and will be listed on the Nasdaq under the ticker "BNAI",
the sources said. 
    Cohen & Company Capital Markets was the financial adviser on
the deal, the sources said. 

 (Reporting by Echo Wang in New York; Editing by Anirban Sen and
Leslie Adler)
 ((E.Wang@thomsonreuters.com; +13322191785; Reuters Messaging:
@deer_echo_))