Swiftmerge Acquisition Corp (IVCP) to acquire HDL Therapeutics (Private) in a transaction valuing the pro forma entity at $480 million in Enterprise Value (*$478 million equity value) assuming zero redemptions from the current level of 90.0%.
HDL Therapeutics shareholders will receive an aggregate consideration of $400 million at $10.0 per share (subject to adjustments). They are eligible to receive 11.0 million earnout shares in two tranches at $12.50 and $15.00 respectively over a period of two years post-closing.
Minimum net cash condition of $30.0 million.
No termination fees.
Business combination transaction is targeted to close in the fourth quarter of 2023.
SPAC Details:
Unit Structure: 1 Class A Ordinary Share + 0.5 Redeemable Warrant
#Cash in Trust: $23,367,864 (104.0 % of Public Offering)
Public Shares Outstanding: 2,246,910 shares
Private Shares Outstanding: 5,625,000 shares
Trust Value/Share: $10.40
Current Liquidation Date: March 15, 2024
Outside Liquidation Date: March 15, 2024
Name of Target: HDL Therapeutics
Target Description: HDL Therapeutics is a biotech innovator, focused on developing first-in-class treatments for intractable cardiovascular and neurovascular diseases using the company’s proprietary technology platform.
Aggregate consideration of $400 million in cash and shares of common stock valued at $10.0 per share
Merger consideration means:
(i) Base purchase Price i.e., $400 million
(ii) Less:
the Series X Gross Up Amount/Cash consideration
(i)-(ii) divided by
$10.0
11.0 million earnout share consideration over a period of two years post-closing as follows:
6.00 million earnout shares if the price per share ≥ $12.50 per share
5.00 million earnout shares if the price per share ≥ $15.00 per share
PIPE / Financing:
SPAC will try to raise an amount equal to $80.0 million
Target has agreed to use commercially reasonable efforts to obtain additional financing through the sale of additional Series X Preferred Stock of the Target as follows:
an aggregate of $2.68 million in Pre-Closing Financing till December 31,2023
additional $3.00 million after 2023 period to pay its expenses, debts and other liabilities and commitments
Rasing the Pre-closing Financing is conditioned on the fact that such investors should accept Parent Common Shares at the time of closing as payment
Redemption Protections:
Nil
Support Agreement:
Standard voting support
Lock-up:
Sponsor: 180 days post-closing
Early release: If price ≥ $12.0 after 150 days post-closing
Target Key shareholder: Same as sponsor
Closing Conditions:
Termination date: March 15, 2024 (June 15, 2024 with extension)
Minimum net cash condition of $30.0 million
Cash includes:
Cash in Trust
Less:
Redemptions
Add:
aggregate cash amount obtained through financing arrangements
Less:
Target Transaction Expenses
Less:
SPAC Transaction Expenses
Less:
aggregate amount of cash paid in respect of the Series X Gross Up Amount
Less:
aggregate of each applicable electing holder’s Series X Option Amount
Other customary closing conditions
Termination:
No termination fees
Other standard termination clauses
Advisors:
SPAC Legal Advisors: Loeb & Loeb LLP
Target Legal Advisors: Mayer Brown LLP
Financials (N/A):
No financials provided
Comparables (N/A):
No valuations provided
Equity Incentive Plan:
10% of the Parent Common Shares outstanding post-closing
Evergreen provision mutually agreeable to the SPAC and Target
*Denotes estimated figures by CPC
#Reported as on June 15, 2023 (Extension Meeting results)
