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Sunday, 4 October 2020

Nassef Sawiris is getting on the SPAC train

INVESTMENT WATCH- Nassef Sawiris is getting on the SPAC train: Bn’aire Nassef Sawiris’ special purpose acquisition company (SPAC), Avanti Acquisition Corp, priced its initial public offering at USD 600 mn on Friday ahead of listing on the New York Stock Exchange, according to BusinessWire. The blank-check company will sell 60 mn units at USD 10 each during the listing, which is expected to close on 6 October. Avanti owner NNS Group — made up of Sawiris’ family office and Sienna Capital, a subsidiary of USD-bn European investment holding company Groupe Bruxelles Lambert — will invest another USD 100 mn on top of what is raised during the listing, Bloomberg reports, citing sources familiar with the matter.

Avanti will focus on high-growth family- and founder-led European businesses and will become the largest US-listed SPAC to focus on European acquisitions.

What’s a SPAC again? Special-purpose acquisition companies are listed entities focused solely on acquiring companies. They exist just to allow the creator to raise money in an IPO on a stock exchange, and don’t actually have commercial operations. Owners drum up interest among institutional investors as they would do ahead of an IPO and then float the SPAC on a stock exchange. After going public, the founders get to work finding companies to acquire. We broke down the whole process in our first Enterprise Explains section last month.

Other SPAC news from the region: Israeli SPAC ION Acquisition Corp raised USD 225 mn when it listed on the NYSE on Friday, becoming the only blank-check company focusing only on targets in the Middle East, Reuters reports.

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