A small blank check company backed by state investor Temasek debuted in Singapore on Thursday, marking the first such local listing as Singapore steps up its efforts to become a key location for such listings.
It came four months after the Singapore Stock Exchange allowed the listing of special purpose acquisition companies or shell companies, relaxing proposed rules in response to market feedback.
Vertex Venture’s SPAC listing also marks the first major launch of such vehicles in Asia since the frenzy seen in the US in early 2021 before regulatory changes there.
“As the first SPAC in Singapore, we had to navigate difficult and uncharted waters,” Chua Kee Lock, CEO of Vertex Venture, a subsidiary of Temasek, told company executives, bankers and lawyers during the meeting. a registration ceremony.
With an eye on sectors including cybersecurity and fintech, Vertex Technology Acquisition Corp raised S$200 million ($148 million), with 13 high-profile investors such as Temasek-related entities and a fund operated by Dymon Asia, contributing 55%.
SPAC last traded little from its offering price of S$5 per unit after being heavily oversubscribed.
Vertex Venture, the sponsor, which manages $5.1 billion in assets with a portfolio of more than 200 companies, has up to two years to find a target.
“The goal is to attract high-growth technology companies that conventionally wouldn’t have considered this market and now have sponsors who can also take the risk,” Chua told Reuters this week.
SPACs raise funds through public offerings, place them in a trust, and then aim to merge with a private company and take it public, typically offering faster listing times and strong valuations.
Another SPAC, Pegasus Asia, backed by European asset manager Tikehau Capital and a holding company of the chairman of LVMH, among others, has raised S$150 million and plans to invest in technology sectors. It lists Friday.
An A$150 million SPAC sponsored by Southeast Asian industrial and technology buyout fund Novo Tellus Capital Partners, has secured investments from a Temasek unit and others. It lists next week.
Southeast Asia is seeing a boom in start-up funding as investors bet on post-pandemic technologies.
SGX offers a regulatory framework similar to the US, including allowing retail investor participation, but also requiring sponsors to invest in SPACs.
Analysts say risks include SPACs overvaluing companies and failing to find ideal targets.
‘HERE TO STAY’
“While there are always fluctuations in the market, we believe the SPAC framework is here to stay and complements the traditional route of IPOs,” Mohamed Nasser Ismail, head of equity capital markets, told Reuters. SGX.
Focusing on sponsor track records and ensuring their mandatory investment in SPACs, SGX is bullish on SPAC listings.
Although considered one of Asia’s major financial and trading hubs, Singapore has not captured any major IPOs. Last year, fundraising on SGX halved to $565 million, a six-year low, with just eight signups, according to Refinitiv data.
Hong Kong, home to major Chinese listings, also allows SPAC listings from this year but prohibits retail investor participation.
Eng-Kwok Seat Moey, head of capital markets at DBS, said SPACs were accepted by many investors as an alternative to access start-ups that typically tap into private equity markets.
“Several Singaporean and regional companies in high-growth high-tech sectors will be ripe for listing on public markets in the coming years,” she said, adding that these would become consolidation targets. companies for SPACs listed on SGX.
Credit Suisse and DBS are joint issue managers of Vertex SPAC and joint global coordinators with Morgan Stanley.
Comments are closed.