Lloyd's of London SPAC venture scrapped due to volatile markets (updated)

Financials Acquisition

13/11/2023 07:40

(Writes through with more detail, LIU comment)
    By Huw Jones
       LONDON, Nov 13 (Reuters) - Financials Acquisition Corp
 FINSF.L  said on Monday it would enter liquidation as it scraps
a planned merger with its newly formed insurance venture, citing
"insufficient" cash commitments due to volatile capital markets.
    The special purpose acquisition company (SPAC) had unveiled
plans to combine with London Innovation Underwriters (LIU) and
raise additional funds to deploy in the Lloyd's of London
insurance market.
    A shareholder meeting planned for Nov. 14 to approve the
tie-up plans and seek up to 300 million pounds has been
cancelled, the company said.
    The SPAC has an end of year deadline to use funds raised for
a takeover, and said it would not seek an extension.
    "Consequently, the Company proposes to cease operations,
other than for the purpose of returning funds to Shareholders
and conducting an orderly winding up of the Company," Financials
Acquisition Corp said in a statement.
    "In order to ensure due payment of creditors, the Company
proposes to appoint a liquidator as soon as practicable to
administer the winding up of operations, and expects to release
a further announcement regarding this process in due course."
    LIU said despite interest from a wide range of investors,
the level of demand was insufficient to reach the minimum cash
threshold required.
    LIU said it would consider exploring alternative options to
pursue its strategy of accessing the Lloyd's of London insurance
market.
    The failed effort comes amid a dearth of new listings in
London and concerns over its appeal as a capital markets hub,
despite profits at Lloyds of London which are booming thanks to
rising prices for insuring commercial risks.
    Following a frenzy of deals in the early days of the
COVID-19 pandemic, SPACs have lost popularity as they struggle
to find businesses to merge with. Others have seen lacklustre
stock performance after acquiring a target.

 (Reporting by Huw Jones; editing by Sinead Cruise and Jason
Neely)
 ((huw.jones@thomsonreuters.com; +44 207 542 3326; Reuters
Messaging: huw.jones.thomsonreuters.com@reuters.net))