China Inc offers 360 view of SPAC last hurrah
14/07/2022 05:07
(The authors are Reuters Breakingviews columnists. The opinions
expressed are their own.)
By Jennifer Hughes and Antony Currie
HONG KONG, July 14 (Reuters Breakingviews) - Carmaker Chijet
is merging with a blank-cheque vehicle that planned to scout for
healthcare firms. Video streamer Glory Star, bought by a SPAC in
2020, is accepting a net buyout price barely equal to last
year’s earnings. They are fitting examples of a distorted and
dying market.
Full view will be published shortly.
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CONTEXT NEWS
Video-streaming service Glory Star New Media on July 11 said
it had agreed to be taken private for about $106 million in a
buyout led by founder and Chief Executive Bing Zhang. The
company started trading on the Nasdaq in 2020 after merging with
a special purpose acquisition company in a deal valuing it at
$425 million.
China-based carmaker Chijet Motor agreed to merge with Deep
Medicine Acquisition Corporation, a Nasdaq-listed SPAC, in a
deal that values the target’s enterprise at $2.55 billion, the
two companies said on July 13.
Chijet’s assets consist of majority stakes in two companies:
It owns 85% of an electric-vehicle maker called Shandong Baoya
New Energy Vehicle, and 64% of FAW Jilin, an offshoot of Chinese
carmaker FAW.
Deep Medicine went public in October, raising just under
$127 million. Its executives intended to focus on a healthcare
acquisition, though didn’t rule out a deal in any industry.
((Column by Jennifer Hughes in Hong Kong and Antony Currie in
Melbourne. Editing by Una Galani and Pranav Kiran)
)
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