SoftBank-backed biotech EQRx falls after deSPACing

EQRx

20/12/2021 15:14

** EQRx Inc  EQRX.O  shares fall as much as 9.4% to $7.87
early Mon in biotech firm's debut
    ** EQRx on Fri announced completion of business combination
with Keith-Meister-backed SPAC CM Life Sciences III  urn:newsml:reuters.com:*:nGNX1LMGNy
    ** The $3.65 deal announced in Aug was to provide EQRx ~$1.8
bln, including $1.2 bln (private investment in public equity)
from Japan's SoftBank Group  9984.T , Casdin Capital, Corvex
Management, Fidelity Management and Franklin Templeton, among
others  urn:newsml:reuters.com:*:nL4N2PD2II
    ** It appears from filing https://www.sec.gov/ix?doc=/Archives/edgar/data/1843762/000121390021065768/ea152521-8k_cmlifesci3.htm
 on Fri that over 80% of the SPAC's shareholders redeemed their
shares before the merger closed; Meister's SPAC raised $552 mln
in its Apr IPO
    ** Many firms that have merged with SPACs to list publicly
have experienced high withdrawals recently, including media co
BuzzFeed  BZFD.O  and Zoom Video-backed  ZM.O  event management
software co Cvent  CVT.O   urn:newsml:reuters.com:*:nL4N2T137P
    ** Large shareholder redemptions, along with any potential
stakeholder lock-up provisions, result in a small public float,
which can stoke volatility in a co's shares after a merger
    ** The De-SPAC index  .DESPACTR , which tracks the 25
largest cos that completed a SPAC merger, has roughly halved
from its Feb record high
    ** Shares of the SPAC CM Life Sciences on Fri closed at
$8.69

 (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))