Flipkart deliberates on a SPAC merger to go public
Whereas many early stage corporations in India and the US are contemplating going public by means of a shell firm or SPAC (Particular Function Acquisition Firm), Flipkart seems to be following of their footsteps because it seems to go public this yr. .
E-commerce big, purchased by US retail titan Walmart in 2018 for $ 16 billion, now plans to merge with a SPAC velocity up its itemizing course of in the US, a report of Bloomberg mentioned, citing sources.
Flipkart advisers have reached out to a number of SPACs, the report mentioned, including that the Bengaluru-based retailer might search a valuation of a minimum of $ 35 billion through the SPAC merger. Though these discussions are at a really early stage, the report provides.
Also called clean verify corporations, PSPCs are shell corporations shaped strictly to lift capital by means of an Preliminary Public Providing (IPO) for the aim of buying an current non-public firm. After acquisition, a SPAC is often listed on one of many main exchanges. For personal corporations, PSPC is a neater and cheaper various method to increase funds, in comparison with the standard IPO course of, which is cumbersome, costly and time consuming.
Though PSPCs have been round for many years, it’s within the final yr that they’ve grow to be more and more common. In line with a Reuters report, primarily based on information gathered by Dealogic, U.S.-listed PSPCs have raised a file $ 82 billion in IPOs final yr, whereas greater than 120 SPACs raised $ 36.19 billion in mid-February 2021.
In direction of the tip of final yr, PSPCs additionally gained consideration in Southeast Asia, with Indonesian unicorns like Tokopedia and Traveloka seeing this as a potential choice to go public. It seems like this pattern could also be catching up in India as nicely.
Quoting Utpal Oza, Head of Funding Banking India at Nomura Holdings Inc, Bloomberg mentioned as much as 10 Indian corporations might go public by means of PSPC offers earlier than the tip of the yr.
Per week in the past, it was reported that Grofers, an e-grocer backed by SoftBank, was contemplating merging with a clean verify firm to checklist its shares. One other Indian firm ReNew Energy, which is likely one of the largest producers of renewable vitality, not too long ago introduced its merger with a Nasdaq-listed SPAC referred to as RMG Acquisition Corp. II.