In this news, we discuss the U.S. bioplastics firm Danimer agrees $890 million deal to go public: sources.
(Reuters) – Danimer Scientific has agreed to go public by merging with blank check acquisition company Live Oak Acquisition Corp LOAK.N, in a deal that values the US bioplastics company at around 890 million dollars, according to people familiar with the matter.
This is the latest example of a company choosing to go public by merging with a so-called Special Purpose Acquisition Company (SPAC), rather than through a traditional initial public offering (IPO). .
A wave of companies, including sports betting platform DraftKings Inc DKNG.O and U.S. health services company MultiPlan Inc, have agreed to make deals with PSPCs for an IPO this year.
A PSPC is a shell company that raises liquidity during an IPO with the aim of buying an unidentified private company, usually within two years. It can offer a private company immediate certainty about the valuation it will get when it goes public, as opposed to a traditional IPO. The downside is often the remuneration of PSPC executives, who may request to receive for themselves significant stakes in the merged company.
For Danimer, based in Bainbridge, Ga., The deal with Live Oak will give him funding to continue its capacity expansion plans that were delayed earlier this year by the COVID-19 pandemic.
Danimer sells renewable and sustainable biopolymers that are biodegradable and compostable, a alternative to traditional plastic products.
The global biopolymers market is expected to exceed $ 13 billion by 2021, according to data from Transparency Market Research.
Live Oak raised $ 200 million in May 2020 via an IPO on the New York Stock Exchange.
Danimer will continue to be led by Managing Director Stephen Croskrey.
Report by Joshua Franklin in New York; Editing by Lisa Shumaker
Original © Thomson Reuters
Originally posted 2020-10-05 02:16:09.