BBQGuys go easy on the hot sauce

Velo3D

20/07/2021 17:47

(The author is a Reuters Breakingviews columnist. The opinions
expressed are their own.)
    NEW YORK, July 20 (Reuters Breakingviews) - BBQGuys want to
serve up the metaphorical spatulas and forks for the
grill-making initial public offering mini-boom. The firm is
merging https://velocityacq.co/wp-content/uploads/2021/07/BBQGuys-Announcement-Press-Release.pdf
 with special-purpose acquisition company Velocity Acquisition
 VELO.O  at an enterprise value of $839 million. It’s profitable
https://www.sec.gov/Archives/edgar/data/0001832371/000121390021037595/ea144476ex99-2_velocityacq.htm,
 but it’s also peripheral – and its valuation reflects that.
    The e-commerce outfit, backed by former football star Peyton
Manning and other family members, sells grills and smokers from
brands like Weber and Traeger, both of which filed for IPOs this
month. Demand for grills has soared during the Covid-19
pandemic, so BBQGuys’ revenue increased 68% in 2020. But it’s
one of many places where backyard chefs can find such products.
The company’s not just a bet on grilling habits, but on grilling
connoisseurship, which makes it somewhat more speculative.
    BBQGuys are going easy on the special sauce with their
valuation. At 2 times next year’s estimated sales it’s cheaper
than suppliers may fetch  urn:newsml:reuters.com:*:nL1N2OO13B. Then again, it also lacks
the additional simultaneous investment from big-name firms like
BlackRock  BLK.N  and Fidelity common to many other SPAC deals.
That makes it look at best like a palatable side-dish. (By
Amanda Gomez)

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 (Editing by John Foley and Oliver Taslic)
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