Zurich-based investment firm Lakestar Chair Klaus Hommels, 51, a Swiss billionaire venture capitalist having had a net asset worth of $2.4 billion to-date, had rolled out an SPAC (Special Purpose Acquistion Company) or blank-cheque company in Frankfurt later this week through Lakestar, becoming the latest to embark on a latest trend that has spread into Europe after gaining an immense popularity in the United States last year as former UniCredit boss Jean-Pierre Mustier had partnered up with the French fashion tycoon Bernard Arnault to start off an SPAC in Amsterdam, local media reports had revealed.
More importantly, latest move from Klaus Hommels’ to launch an SPAC for Frankfurt listing held a substantial scale of significance since his blank-cheque firm in effect would provide a practicable route for a raft of European tech start-ups to go public without crossing the Atlantic, engendering prospects of a boom in SPAC-backed listing in Europe that would not require traditional IPO (Initial Public Offerings) process.
In point of fact, SPACs (Special Purpose Acquisition Company) is a shell entity that could be capitalized on to take a company public by bypassing the traditional IPO route following a merger or acquisition, while SPACs are allowed to raise financing in IPOs for the mergers or acquisitions without telling their investors about the firms that they have been pursuing.
Lakestar’s Hommels-backed SPAC seeks to raise up to €275 million
In tandem, according to local media reports, the planned blank-cheque company of Hommels who has been one of the early investors in the audio streaming industry giant Spotify, was looking to raise as many as €275 million which in effect would value the SPAC firm between €750 million and €4 billion.
German e-commerce trailblazer Rocket Internet alongside meal kit company Hellofresh have also been mulling an SPAC, though the companies were planning an SPAC initial offerings in NYSE.