German electric air taxi developer Volocopter has cancelled its planned SPAC IPO in the US, according to a media report. This apparently emerges from investor letters that investors are said to have received a few days ago. With the cancellation of the deal, the approximately 750 small investors could all but go away empty-handed.
Consequently, the crowd investors are very unhappy, as the magazine Capital writes. Those crowd investors had once financed the start of the project. With the IPO by merger, which has been speculated about since the summer, the early investors hoped to be able to multiply their former investment.
However, the non-binding letter of intent that was apparently made for the SPAC IPO in the summer has probably come to nothing. The reason given in the letter quoted by “Capital” is the market environment and the results of the IPOs of some competitors – where investors were only cautious. “The facts and figures, unfortunately, make it more than clear in recent weeks and months that the current time is conceivably unfavourable for a successful SPAC transaction,” the investor letter says.
One of the competitors is Lilium, which raised significantly less than hoped for in its IPO in September. 65 per cent of the original shareholders of SPAC merger partner Qell had preferred to return their shares instead of exchanging them for Lilium shares – they have this right if the new partner company does not appeal to them. Volocopter CEO Florian Reuter describes the problem: “This leads to the fact that some transactions could just about pay the transaction costs with the money raised, but no further capital was left for company growth.” Therefore, the risks of a transaction are too high.
capital.de (in German)
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