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Showing posts with the label SPAC

Alert: Nikola Founder Trevor Milton Indicted On Fraud Charges

The founder of embattled electric car startup Nikola Corp. has been formally indicted on fraud charges by the US Justice Department months after resigning from the company. Trevor Milton by name, he's been accused of securities and wire fraud in connection with a scheme to defraud and mislead investors. Milton is accused of misleading investors by making false statements regarding Nikola's products and capabilities. Notably, most of the investors allegedly misled were on the retail side. The DOJ alleges that Milton made false claims regarding "nearly all aspects" of Nikola's business. Milton founded Nikola in 2014 and led it through a public listing via a merger with a special-purpose acquisition company (SPAC) last year. The DOJ threw an apparent jab at SPACs in his indictment, asserting that he made 'many' of his false and misleading claims  during a period where he would not have been allowed to do so under rules that govern traditional IPOs were he

SPAC: Game Studio Jam City Calls Off $1.2B Merger Deal

Jam City , a mobile games studio with a bevy of hits, has withdrawn its plans to go public by merging with a special-purpose acquisition company (SPAC). It's called off its earlier-agreed with DPCM Capital (NYSE: XPOA), a SPAC formed by ex-Uber executive Emil Michael. The reasons for calling off the merger are uncertain and unspecific. Vaguely, both firms said in a joint statement that it is "the best path light of current market conditions." Now, DPCM Capital will have to find a new merger target. Originally, DPCM and Jam City sought to combine in a deal valuing the latter at $1.2bn . As part of their combination, Jam City was supposed to use money from DPCM to finance a $175mn purchase of Canada-based mobile game publisher Ludia . Now, it's unclear if that acquisition will go through. It may be that Jam City has sought to remain privately-held, or it's found an alternative path onto the public markets. The company could seek a traditional IPO in

SPAC: SEC Charges Stable Road, Momentus Over False Claims

In one of the first such cases of the US Securities and Exchange Commission (SEC) formally pressing charges on a special-purpose acquisition company (SPAC), the agency opened a case against Stable Road Acquisition Company , a SPAC, and   Momentus , a spaceflight startup that is its merger target. The SEC on Monday announced charges against Stable Road and Momentus and the firms' respective CEOs for making misleading claims to investors about Momentus' technology and national security concerns surrounding  Mikhail Kokorich , the Russian founder and CEO of the space company. Last October, Momentus agreed to merge with Stable Road to become a public company. The merger terms valued Momentus at $1.2bn (later halved ), despite the company being in the pre-revenue stage. As usual with SPACs, the pitch given to investors was ambitious and overtly promising, with Momentus claiming it had “successfully tested” its spacecraft propulsion technology. But, the SEC said not so fast, objec

SPAC: Crypto Exchange Bullish To Go Public In $9B Deal

It's an interesting day in the world of SPACs and cryptocurrency, two worlds that are much driven by hype with fundamentals notwithstanding in many cases. You know when they say bullish like I'm bullish (aggressively confident) on a stock.  It turns out that there's a new crypto exchange bearing the name Bullish and that exchange has secured one of the biggest SPAC merger deals on the block. Here's the thing, Bullish has not even fully launched but has agreed to go public via a SPAC merger at a valuation of $9bn (?!). More so, it's merging with a SPAC launched by Thomas Farley, an ex-President of the New York Stock Exchange who'll then become Bullish's CEO after the merger. I may not know much but that seems to signal some conflict of interest. Bullish has agreed to merge with  Far Peak Acquisition Corporation (NYSE: FPAC) to become a public company. The terms of the merger value the crypto exchange at $9bn Pro-forma, a very high valuation for an exchange

SPAC: US DOJ Probing EV Startup Lordstown Motors

In the latest episode of the saga with electric vehicle startup Lordstown Motors , it's now facing an investigation from the US Justice Department for possible fraud. The pilot of this saga were  fraud accusations from short-seller Hindenburg this March and has made for an interesting series since that time. The Justice Department's investigation into Lordstown Motors was first reported by The Wall Street Journal . It's being handled by the U.S. attorney’s office in Manhattan and is in its early stages, the report said. With big ambitions, Lordstown Motors went public last year through a merger with a special-purpose acquisition company (SPAC) that added $675mn to its cash coffers to fund commercial production of its planned electric truck. But fast forward a few months after and Lordstown warned that it didn't have sufficient cash to fund production, weighing down investor hopes. The warning from Lordstown opened up a storm of backlash that despite raising hundreds o

Hedge Fund Perceptive Forms 5th SPAC To Raise $130M

Perceptive Advisors, a major hedge fund focused on life sciences investments, has launched what is its 5th special-purpose acquisition company (SPAC) in succession to raise $130mn from an IPO. The fifth SPAC,  ARYA Sciences Acquisition V , recently unveiled an S-1 filing for an IPO. It's seeking to raise $130mn by selling 13 million shares for $10 apiece. ARYA Sciences Acquisition is the umbrella under which Perceptive has launched its SPACs since it got into the game in 2018, two years before the SPAC boom of 2020. Its SPACs have raised hundreds of millions and merged with biotech outfits including  Cerevel Therapeutics , a company treating neurotic diseases, and  Nautilus , a human proteomics company. The size of Perceptive's SPACs has usually been $100mn-$200mn and this fifth one is no exception with $130mn, or $150mn if an over-allotment option is fully exercised.  Like all of its SPACs, this fifth one will seek a life sciences company as a merger target. Perceptive is one

SPAC: BuzzFeed To Go Public In $1.5B Deal

In the world of SPACs, there's a new merger that isn't the usual type we're accustomed to. Usually, companies merging with SPACs are high-growth tech startups with big ambitions or more established traditional businesses. But, in this case, the new merger is BuzzFeed , yes that "click farm" BuzzFeed you know. BuzzFeed has agreed to merge with  890 Fifth Avenue Partners Inc. (Nasdaq: ENFA) and become a public company. The merger terms value the media company at $1.5bn. From its merger, BuzzFeed will get $288mn of cash held in trust by the SPAC and then a $150mn PIPE round from a group of asset managers, summing up to $438mn. A sizeable portion of the merger proceeds will finance a new BuzzFeed acquisition of Complex Networks , a media brand focused on 'youth culture'. BuzzFeed is paying $200mn in cash and $100mn in equity for the media brand. The merger is scheduled for completion in Q4 2021, upon which BuzzFeed will start trading on the Nasdaq exchange.

SPAC: Self-Driving Startup Embark To Go Public In $5.2B Deal

An autonomous driving startup in the US with a focus on trucks has sealed a big deal to go public via the SPAC route. You may have heard this just recently (in the case of Plus ) and wondering if we're repeating previous news, but no, it's another startup, an even bigger one by valuation. Embark Trucks, a self-driving startup founded by two University of Waterloo dropouts, has agreed to merge with a SPAC and go public with a valuation of $5.2bn. It's a pretty lavish valuation for a company still in the R&D phase and making no money. Embark will merge with Northern Genesis Acquisition Corp. II (NYSE: NGAB). The deal will hand over to the startup $414mn of cash from the SPAC and then a $200mn PIPE round, making a total of $614mn. Investors that have committed to the $200mn PIPE round include Sequoia Capital, Tiger Global, and Mubadala Capital. As part of the merger terms, Embark is getting a new board member in Elaine Chao, the former US Secretary of Transportation under

Deal: Bill Ackman's SPAC To Buy 10% Of Universal Music

Following confirmation of deal talks earlier this month,  Pershing Square Tontine Holdings , a SPAC formed by famous activist investor Bill Ackman, has officially signed a deal to buy 10% of Universal Music Group (UMG), a "big four" record label.  Pershing Square Tontine Holdings (PSTH) will buy the 10% stake from Universal's current owner, the French media conglomerate Vivendi . The purchase values the major record label at €35 billion ($41.6bn). Shortly after PSTH buys its stake, Vivendi plans to list Universal Music on the Euronext Amsterdam stock exchange towards the end of September. With the deal, PSTH will become a UMG shareholder along with parent firm Vivendi and China's Tencent. The structured deal is unusual for special-purpose acquisition companies like PSTH. Normally, a SPAC would merge with a single company by buying a certain percentage of it with its cash and combining its equity, but in PSTH's case, it'll buy a stake in Universal and then ro

SPAC: EV Battery Startup Solid Power To Go Public In $1.2B Deal

There have been many SPAC deals coming from the electric vehicle industry and it's obvious that it ain't stopping. The latest deal to come from that end is Solid Power , a startup working on solid-state batteries for EVs that has automakers Ford and BMW as investors. Solid Power has agreed to merge with a SPAC named Decarbonization Plus Acquisition Corporation III (NASDAQ: DCRC). As expected, it'll start trading on the Nasdaq market following the merger. Terms of the merger value Solid Power at $1.2bn. From the deal, the startup will get $350mn of cash held in trust by DCRC and then a $165mn PIPE round from investors including chemicals giant Koch Industries.  The merger announcement comes shortly after Solid Power raised a $130mn private round co-led by BMW and Ford. The two automakers are strategic investors and partners to the company. Notably, Solid Power is a pre-revenue company. It's been focused on R&D so far in its nine years of existence and doesn't e

SPAC: Short-Seller Hindenburg Targets DraftKings

Hindenburg Research is a short-selling focused investment firm known for going after public companies with serious allegations. Lately, it's become the Darth Vader hunting after SPAC deals, and it's proven that once again by going after the first company that tested this new era of SPAC mergers. Hindenburg has published allegations targeting sports betting company DraftKings (NASDAQ: DKNG) , more so the betting company named SBTech that it combined with in a 3-way-merger with a SPAC in 2020. As usual, Hindenburg has taken a short position in the company. Hindenburg's accusations center on SBTech allegedly enabling money laundering and illegal gambling activities with its software. SBTech provides backend software that powers gambling sites. In its statement, Hindenburg alleged that SBTech makes money from enabling online gambling in markets where that is illegal and works to hide this fact from investors. It pointed fingers at a subsidiary of the company called  BTi/Core

SPAC: Lordstown CEO, CFO Resign After Cash Woes

At electric vehicle startup Lordstown Motors , two of its top executives have resigned shortly after the company warned that it didn't have sufficient cash to kick off production of its electric truck. Those two executives are CEO Steven Burns and CFO Julio Rodriguez, effective immediately. The leadership change at Lordstown follows a pattern at struggling companies. In Lordstown's case, the company says it doesn't have enough capital to fund the production of its electric truck despite raising $675mn from a SPAC merger last year. It's quite a drastic turn for Lordstown which debuted on the public markets last year with ambitious, wild promises to its investors. Even then, the company said it didn't expect to raise further capital after the $675mn from its SPAC deal but now appears to be hurting for cash. In March, Lordstown was accused of fraud by short-seller Hindenburg Research, which alleged highly faked pre-orders and undisclosed production challenges to in

SPAC: Online Grocer Boxed To Go Public In $900M Deal

Boxed , an online wholesaler of groceries and related products, is the latest tech startup going public through a SPAC merger. It's agreed to merge with  Seven Oaks Acquisition Corp. [Nasdaq: SVOK] to become a public company. Details The merger deal values Boxed at approximately $900mn, precisely $887mn. It's a solid valuation for a startup that reportedly rebuffed a $500mn acquisition offer (from grocery chain Kroger) in 2018. From its merger, Boxed will get $259mn of cash held in trust by Seven Oaks and then a $120mn PIPE round from a group of asset managers. The PIPE round includes the sale of equity ($32mn) as well as convertible bonds ($88mn).  All in, Boxed will emerge with $334mn of net cash proceeds from its merger. That's even more than the $244mn of venture funding it's raised in total as a privately-held startup. Boxed is a "big box" grocery e-tailer, that is corporate-speak for wholesales. Its platform is focused on bulk-sized shopping, whereby

SPAC: Self-Driving Startup Plus To Go Public In $3.3B Deal

An autonomous driving startup with its major operations in the US and China is the latest tech company that's set to hit the public markets through a merger with a special-purpose acquisition company (SPAC). That startup is Plus (formerly, one focused on automated trucking. Plus has agreed to a deal to merge with Hennessy Capital Investment Corp. V (NASDAQ: HCIC) and become a public company. The terms of the merger value the self-driving startup at $3.3bn. From its merger, Plus will get $345mn of cash held in trust by HCIC and then a $150mn PIPE round from investors including BlackRock and the D. E. Shaw Group. That sums up to a cool $495mn for the company to fund its operations. The cash from its SPAC merger is crucial for Plus, as a company that plans to kick off mass production of its product this year.  Plus sells a stack of hardware and complementary software to enable automated driving for trucks. Its main customer base is truck manufacturers, such as China's F

SPAC: EV Startup Lordstown Motors Is In Trouble

You may have heard of this story before - an electric car startup launches, then makes very big promises to investors as it sought to go public through a SPAC merger. But, it later turned out that those promises were a sham. In the above short story, that was Nikola , the troubled electric car startup that was the first company to test the waters of the current SPAC boom. Now, that story is likely repeating itself with another company - Lordstown Motors (NASDAQ: RIDE) . In a recent filing to the SEC , Lordstown warned that it doesn't have sufficient capital to fund commercial-scale production of its electric truck. This is despite raising $675mn from its SPAC merger last year. With its admission of lacking capital, Lordstown is definitely in financial trouble if further investment isn't secured. The question is will investors will be willing to give it loads of cash once again? Lordstown's recent admission is just much in contrast with its sentiment at the time of its SPAC

SPAC: Banking App Dave To Go Public In $4B Deal

In the world of special-purpose acquisition companies, there are new mergers unveiled every day. This day, the new merger on the block is Dave , a banking app backed by investors including Mark Cuban. Dave has agreed to merge with VPC Impact Acquisition Holdings III, Inc. (NYSE: VPCC) and become a public company. That's the SPAC sponsored by Victory Park Capital, an investor in Dave before now. The deal terms of Dave's merger value the banking startup at $4bn. The merger will see Dave get $254mn of cash held in trust by the VPC SPAC and then a $210mn PIPE round led by hedge fund Tiger Global.  As usual for SPAC deals, Dave's merger announcement came packaged with an investor presentation that provides strong insight into its business. It shows that the banking app, with 10 million users, made $122mn in revenue in 2020. Impressively, Dave was founded just four years ago and is now set for a $4bn exit on the public markets. Not many startups can boast of that growth and suc

SPAC: UK's Babylon Health To Go Public In $4.2B Deal

Another tech startup from the UK has agreed to go public in the US by merging with a special-purpose acquisition company (SPAC). This time, it's Babylon Health , a telehealth app providing access to doctors and medical services. Babylon Health has agreed to merge with Alkuri Global Acquisition Corp. (NASDAQ: KURI) and become a public company. The merger terms value Babylon Health at $4.2bn. From the merger, Babylon will get $345mn of cash held in trust by Alkuri, then a $230mn PIPE round adding it up to $575mn. The PIPE round includes a strategic investor - data analytics company Palantir. From its investor presentation , it's indicated that Babylon Health made $79mn in revenue in 2020. In tune with the excessive projections we've become accustomed to in SPAC deals, the company then projects to have $710mn in annual sales by 2022.  Babylon makes money both from recurring subscriptions to its telehealth app as well as one-off fees for doctor consultations. On that end, it&#

Alert: Palantir Goes On SPAC Investing Spree

In our constant quest of tracing signals on the stock markets, we've picked up one subtle signal in the world of special-purpose acquisition companies (SPACs), and it involves Palantir , the publicly traded data analytics company and a hot stock in its right. It happens that Palantir has gotten keen on investing in SPAC deals, at least six in less than three months. The latest deal was the merger of British telehealth startup Babylon Health which Palantir committed to invest in as part of a PIPE round. Before Babylon Health, Palantir had agreed to invest in the SPAC deals of Wejo , a British automotive data startup;  Lilium , a German air taxi company; Sarcos Robotics , a maker of industrial robots;  Celularity , a clinical-stage biotech company; and drugmaker Roivant Sciences . Palantir's focus on SPAC deals is unique among strategic investors, mainly for the fact that it's betting on more established companies that are often already valued in the billions of dollars. Pa

Bill Ackman's SPAC Confirms Talks With Universal Music

If you're familiar with special-purpose acquisition companies (SPACs), chances are you known Pershing Square Tontine Holdings, a SPAC formed by billionaire activist investor Bill Ackman. Pershing Square, PSTH for short, is the biggest SPAC on the markets after raising $4bn from its IPO last July.  After lots of merger speculations, Bill Ackman has confirmed discussions for a PSTH deal that's unlike the SPAC deals we're accustomed to.  Normally, a SPAC will merge with a single company by buying a certain percentage of it with its cash and combining their equity, but in PSTH's case, it's in talks to buy a stake in record label Universal Music Group (UMG) and rollover cash left in the SPAC into a separate publicly traded entity that would then seek another merger target. PSTH raised $4bn from investors and then $1.6bn from Ackman's Pershing Square hedge fund making a total of  $5.6bn  on its hand. From this $5.6bn, $4.1bn will be used to purchase UMG shares whil

Markets: Investor Chamath Forms 4 Biotech SPACs

The Chamath has struck again. To the unaware, that Chamath is Chamath Palihapitiya who's known for debuting special-purpose acquisition companies (SPACs). After launching six SPACs on the public markets, he's filed to launch four more and this time for the biotech industry.  Chamath's firm, Social Capital, in partnership with hedge fund Suvretta Capital Management has formed four SPACs targeting to raise $200mn each. They go by serial names  Social Capital Suvretta I-IV  with the respective tickers DNAA, DNAB, DNAC, DNAD. The four SPACs will list on the Nasdaq stock market. By their filings, they'll seek mergers in the biotech industry, an area with a lot of hot startups right now making potential targets. After getting merger targets for four of his listed SPACs, Chamath didn't slow down to incorporate four more to list on the markets. For the new SPACs, his firm Social Capital switched partners from London-based VC firm  Hedosophia to American hedge fund  Suvret

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Alert: Nikola Founder Trevor Milton Indicted On Fraud Charges

The founder of embattled electric car startup Nikola Corp. has been formally indicted on fraud charges by the US Justice Department months after resigning from the company. Trevor Milton by name, he's been accused of securities and wire fraud in connection with a scheme to defraud and mislead investors. Milton is accused of misleading investors by making false statements regarding Nikola's products and capabilities. Notably, most of the investors allegedly misled were on the retail side. The DOJ alleges that Milton made false claims regarding "nearly all aspects" of Nikola's business. Milton founded Nikola in 2014 and led it through a public listing via a merger with a special-purpose acquisition company (SPAC) last year. The DOJ threw an apparent jab at SPACs in his indictment, asserting that he made 'many' of his false and misleading claims  during a period where he would not have been allowed to do so under rules that govern traditional IPOs were he

Earnings: AMD Doubles Revenue, Triples Profit

In this earnings season, companies all over are dropping their latest quarterly results and we're here equally reporting on them. We've touched on social media companies Snap Inc and Twitter , electric carmaker Tesla , and iPhone maker Apple . Now, the next is chipmaker AMD Inc . AMD has dropped its earnings for the second quarter of 2021, showing strong prospects as revenue doubled year-over-year and net income more than tripled.   Details AMD posted $3.9bn in revenue in Q2, up 99% year-over-year and 12% from the preceding quarter. For the same period, the company's net income was $710mn , up 352% year-over-year and 28% from the preceding quarter. Doubling its revenue and nearly quadrupling net income indicates AMD has a strong yet fast-growing business. It's bound to grow even more as the company is set to complete its acquisition of rival chipmaker Xilinx . AMD makes money selling high-performance chipsets used in computers, consoles, data centers, and the likes

Antitrust: Amazon Fined $900M By EU For Privacy Violations

Tech behemoth Amazon is for the nth time in the crosshairs of the European Union (EU). The latest saga in that arena is that Amazon has been fined a record-breaking amount for alleged privacy violations, according to an SEC filing from the company. Amazon has been fined the sum of €746 million ($888mn) by the Luxembourg National Commission for Data Protection (CNPD) for not complying with data privacy laws. It's the largest fine imposed under Europe's data protection law.  The fine originates from the CNPD accusing Amazon of processing customers' personal data in violation of the EU's famous-cum-infamous General Data Protection Regulation (GDPR) laws.  In June, it was reported ( WSJ )  that the Luxembourg data protection agency had sanctioned Amazon's privacy practices and proposed a fine topping $425mn to the EU's other two-dozen or so national data protection authorities. Now, it appears that the final fine is much larger than that.  Before now, the bigges

Deal: Qualtrics Buys CX Startup Clarabridge For $1.1B

Months after getting spun out of SAP into a separate public company, Qualtrics , a major provider of online survey software, has made a major acquisition. It's agreed to buy Clarabridge , a startup that does similar work to Qualtrics in the field fondly referred to as "customer experience (CX)". Qualtrics will pay $1.1bn all with shares to buy Clarabridge. The acquisition is a major strategic play for the company, pairing Qualtrics' customer survey business with Clarabridge's similar business of measuring customer sentiment from various sources like social media posts and customer support calls. Basically, Qualtrics is in the business of weighing customer surveys directly and Clarabridge in the business of doing so indirectly . Pairing both businesses represents a major strategic play for Qualtrics. In an investor presentation, Qualtrics said that Clarabridge has $100mn in annual revenue, implying an 11x multiple that it's paying to buy the company. That&#

Deal: Amgen Buys Biotech Startup Teneobio In $2.5B Deal

It appears that this Covid era has led to a boom for companies that work on  antibodies , which are protective proteins produced by the human immune system to tackle foreign substances, usually viruses. Antibodies are very useful in the research and treatment of viruses such as Covid. There are companies that specialize in antibodies and one of them, BioLegend , was recently bought for a whopping $5.3bn . Now, another such company, Teneobio , is getting bought for a big amount. Teneobio has agreed to be acquired by Amgen , an American biotech giant. Amgen is paying $900mn upfront for the company, then an additional $1.6bn in cash contingent on the company hitting certain milestones. It sums up to a $2.5bn deal . Teneobio is a clinical-stage biotech startup working on antibodies aimed at treating cancer, autoimmunity, and other infectious diseases. As it's still in the clinical trial stage with no viable product yet, it appears that Amgen is betting big on Teneobio's trials b

Antitrust: UK Probes Facebook's $1B Kustomer Acquisition

The UK's antitrust agency has launched a probe into Facebook's latest acquisition, that of chatbot platform Kustomer Inc , which Facebook agreed to buy last November for a reported $1bn. The UK's Competition and Markets Authority (CMA) on Friday, the 30th of July, released a statement  indicating it had opened an inquiry into Facebook's purchase of Kustomer, regarding if it'll result in "a substantial lessening of competition" within the market Kustomer operates in. Such probes aren't out of the norm and are routine for big acquisitions. For Facebook, it speaks to the fact that antitrust agencies are watching the company's moves, especially regarding acquisitions. To note, two of Facebook Inc's biggest products outside the main Facebook platform, Instagram and WhatsApp , were acquisitions. In fact, it's primarily acquisitions that have propelled the company's growth. As with such probes, the UK will first seek comments from the public

Hollywood: Reese Witherspoon's Media Co. Sold In $900M Deal

A media company founded by superstar actress Reese Witherspoon has sold for a large amount to a company still in its infancy that hasn't even been named yet. That company is Hello Sunshine , a media company that produces content distributed across various platforms; movies, TV shows, podcasts, et al. Hello Sunshine has been sold to a newly-formed media venture t hat's backed by investment capital from Blackstone , the private equity giant.  The venture is led by ex Disney honchos Kevin Mayer and Tom Staggs .  As it is, the Blackstone-funded venture is acquiring a majority stake in Hello Sunshine from a group of external investors while anchor shareholders like Witherspoon and her founding partners will roll over and retain their equity stakes in the newly-formed venture. Officially, the deal's financial terms weren't disclosed, but a report from The Wall Street Journal says it's a $900mn deal. According to the report, the Blackstone-funded venture will pay $500mn

Earnings: Shopify Beats Estimates, Reaches Major Milestone

In this season of earnings results and we at The Techee  reporting on them, we're here with a beat on Shopify , which has released its earnings statement for the second quarter (April-June) of this year. In Q2, Shopify beat revenue expectations from analysts and as well achieved a major financial milestone by crossing $1bn in quarterly revenue for the first time. Shopify had $1.1bn in revenue in the quarter, up 57% year-over-year. Net income for the same period was $897mn , most of which was due to a $778mn gain in equity investments, likely from Shopify's stake in Affirm , a major 'buy now, pay later' lender. As usual, most of Shopify's sales ( $785mn ) came from "Merchant Solutions", which groups additional services the company offers atop recurring subscriptions charged to online retailers. Sales from subscriptions came at $334mn in the quarter. Gross Merchandise Volume (GMV), representing the total worth of transactions made on the Shopify platform,

Alert: Square Buys Australia's Afterpay For $29B

It's a big day in the fintech world. There's been a major acquisition with a major American fintech company, Square , buying Australia's foremost fintech startup, Afterpay , a 'buy now, pay later' lender. Square has reached an agreement to buy Afterpay for a whopping $29bn , marking one of Australia's biggest buyouts. It's a big deal that a startup founded barely seven years ago is selling for $29bn.  Square will pay the $29bn all with shares. It means that shares of Afterpay, which are traded on the Australian Securities Exchange, will be exchanged for Square stock traded on the New York Stock Exchange (NYSE). Afterpay is Australia's foremost 'buy now, pay later (BNPL)' lender in online retail. For the uninitiated, the 'buy now, pay later' business is a relatively young one providing alternatives to credit cards for consumers to shop online. It provides loans for consumers to shop online and then pay back in installments. Usually, credi

Markets: US SEC Takes Aim At Chinese IPOs

The US Securities and Exchange Commission (SEC) has taken a swipe at Chinese initial public offerings (IPOs) after regulatory hiccups in China have affected many Chinese stocks listed on US markets and American stockholders holding them. The SEC has issued new guidance on Chinese companies seeking to list shares in the US, requiring them to make certain disclosures to investors or otherwise refrain from listing in the US markets. First of all, usually, Chinese companies listing in the US don't actually sell shares of the operating companies but that of shell companies with contractual relationships with the operating companies. These shell shares, known as American Depositary Receipts (ADRs) , are used to circumvent restrictions on foreign ownership of Chinese shares imposed by the country's government. Now, the SEC in a statement has made it clear that Chinese companies seeking to list in the US must provide clear descriptions of the shell operations involved in such listing