Series Dealmaker Martin E Franklinwho last year warned of excesses at blank check companies is raising money for a new buyout venture.
According to data from Bloomberg, Admiral Acquisition Ltd. Units of $10 each on the London Stock Exchange. The sponsor is Capital Butterflya Miami-based family office owned by Franklin.
The offer, which will be worth at least $500 million, will raise funds for an acquisition without restrictions on the target company’s geography or industry. The Jarden Corp. Co-founder works with UBS Group AG And Jefferies Financial Group Inc.
Bloomberg News reported last year that plans for the vehicle were underway.
Franklin, 58, is pushing the listing even after the US bubble in special-purpose acquisition companies burst and many of the vehicles were closed for lack of targets. Of the blank check companies that managed to close deals, many filed for bankruptcy after the target company faltered.
Franklin pioneered the use of blank check companies, raising money for acquisitions and taking over companies as early as 2006 Nomad Foods Ltd. public. He was skeptical about the SPACs boom, warning last year that it would end badly and urging better governance of the business model.
The new vehicle is not a US-style SPAC as the terms do not provide the founders with free shares upon completion of an acquisition. Also, unlike a US SPAC, shareholders cannot redeem their shares in lieu of participating in the acquisition, providing security for the target company’s shareholders.
SPACs have no other job than to raise money for acquisitions. They were initially touted as a way to help companies get public listings while bypassing some of the disclosure requirements of an IPO. However, they suffer from poor post-merger returns, an oversupply of blank check firms, and increased regulatory scrutiny.
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