Barry Sternlicht Ups Jaws Juggernaut Acquisition SPAC to $240M
By Nicholas Rizzi June 18, 2021 2:10 pm
reprints
A cooling, special purpose acquisition company (SPAC) market isn’t scaring Barry Sternlicht out of the water.
Sternlicht upped his latest SPAC, Jaws Juggernaut Acquisition Corporation, by 20 percent to $240 million in its initial public offering (IPO), Sternlicht announced late Thursday.
Sternlicht, founder and CEO of Starwood Capital Group, filed for the Jaws Juggernaut IPO in February with an original offering of up to $200 million, Reuters reported. However, he boosted its size to 24 million shares at $10 per share, the fifth SPAC in a row Sternlicht increased.
Jaws Juggernaut wants to merge with a wireless communications company, and in filings with the U.S. Securities and Exchange Commission (SEC), said it targeted California-based XCOM Labs for a potential merger. That Jaws Juggernaut mentioned a potential merger in SEC filings is unusual for SPACs, which usually don’t mention specific companies in the IPO.
SPACs — blank-check companies that merge with startups to take them public — had a moment last year, but the excitement around them has started to dwindle.
Heads of startups have started to turn down offers to merge with SPACs, pressuring SPAC founders to find mergers within the two-year deadline or give back money to investors.
Numerous SPACs have now started to drop below their debut price as soon as they go public and remain at that level until they announce the company they’re merging with, something that was uncommon for them from November 2020 to February 2021, The Wall Street Journal reported.
Another reason for the cooldown is the increased pressure from the SEC, with the agency announcing in April that it was reviewing SPAC filings and warning that it may be wrong to suggest they carry less scrutiny than a conventional IPO.
