Investments

SPAC Starboard Value Acquisition Launches $360M IPO

SPAC Starboard Value Acquisition Sets Unit Price For $360M IPO

“Blank check" company Starboard Value Acquisition Corp. announced on Thursday (Sept. 10) that it had priced its upsized 36-million-unit initial public offering at $10 per unit. The units commenced trading later Thursday with the “SVACU” stock symbol, selling for as low as $9.97 and as high as $10.07 before closing unchanged at $10.

Each unit consists of a single share of Class A common stock, one-sixth of a single redeemable warrant and a contingent right to get one-sixth of a single redeemable warrant at a minimum. Every complete warrant will let the entity that owns it buy a single Class A share at $11.50, according to the announcement.

The joint book-running managers for the offering are Cowen and Company; Stifel, Nicolaus & Company; and UBS Securities.

SVAC described itself as a “blank check" company formed for the reason of “effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.” SVAC Sponsor, which is a Starboard Value LP affiliate, is serving as the firm’s sponsor.

“While the company may pursue an acquisition opportunity in any industry or sector, it intends to focus on industries that align with the background and experience of its Sponsor and Industry Advisors,” SVAC said in the announcement. “These industries include the technology, healthcare, consumer, industrials and hospitality and entertainment sectors.”

SPACs, which is an acronym for “special purpose acquisition companies," are gaining momentum as the stock market indices in the United States attain new peaks. They serve as development stage shell firms that don’t possess their own business plans but combine with private firms that have them.

DraftKings CEO Jason Robins, however, said he believes that the SPAC market could be getting a bit too large and wishes that it would “settle down.”

“I think there are a lot of SPACs now,” he said. “Some will do well, and some won’t. For the right companies, SPACs are great vehicles, but it’s not a fit for everybody. It’s not a fit for every company.”

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