Zoom Video-backed Cvent de-SPACs, sees high investor withdrawals
09/12/2021 17:43
** Cvent CVT.O shares up 4.9% at $10.70 as event
management software makes its public debut after completing a
SPAC deal
** Cvent late Weds said it closed merger with Dragoneer
Investment Group's special-purpose acquisition company
** The $5.3 bln deal announced in Jul was to bring Cvent
about $800 mln, including a $475 mln PIPE (private investment in
public equity) funded by Zoom Video Communications Inc ZM.O ,
Fidelity Management, Hedosophia and Oaktree Capital Management,
among others urn:newsml:reuters.com:*:nL4N2OZ1YL
** On Dec 7, however, the SPAC disclosed in a filing https://www.sec.gov/ix?doc=/Archives/edgar/data/1827075/000119312521350440/d244539d8k.htm
that about 85% of shareholders redeemed their shares ($233 mln
worth) for cash; Dragoneer's SPAC raised $276 mln in its Nov
2020 IPO
** Many other cos that have sought SPAC deals to go public
have seen high withdrawals recently, including media firm
BuzzFeed BZFD.O urn:newsml:reuters.com:*:nL4N2SR3HV and vacation rental co Vacasa
VCSA.O urn:newsml:reuters.com:*:nL4N2SS3NS
** The average SPAC has now experienced a roughly 60%
redemption rate before a deal was completed, up sharply from
about 25% in Q2 2021 and 12% in Q1, data from SPAC Research
shows
** As a result, trading volume in a firm's shares,
post-SPAC, can be muted due to a small public float, in addition
to any potential stakeholder lock-up provisions
** About 148,000 CVT shares have exchanged hands so far on
Thurs; that compares to 30-day avg volume of ~1.3 mln shares,
per Refinitiv data
** Morgan Stanley served as exclusive financial advisor to
Cvent. MS, JP Morgan and Citi served as placement agents to
Dragoneer on the PIPE
(Lance Tupper is a Reuters market analyst. The views expressed
are his own)
((lance.tupper@thomsonreuters.com
lance.tupper@tr.com 1-332-219-1430))