At the SPAC of Dawn

Good morning! Watch this space moving forward as a roundup of evening filings as well as news nuggets to nibble on beside your morning coffee.

The holidays are just around the corner, but there are already signs that a wide range of consumer companies are going to find coal in their stockings.

Less than half of consumer companies that have reported their third quarter earnings so far beat their revenue estimates, according to Bloomberg, with an increasing number of them citing “weak demand” as the primary culprit.

This may be music to the ears of the Fed as it seeks out the sound of deflation, but it could mean hard times ahead for the sector. The chill comes at a particularly poor time as well considering many consumer companies depend heavily on a strong holiday sales showing to even out their annual numbers.

In their own activity, SPACs may have gotten out ahead of the trend. Of the 25 SPACs that have IPO’d in 2023, only one – Haymaker 4 – claims to be primarily shopping for a consumer target. No SPAC has announced a deal with a North American consumer company since the first half of the year either, despite 46 other deals announcing during that time.

There’s still some warmth in the market in Asia, however, as Kairous (NASDSAQ:KACL) and Plutonian (NASDAQ:PLTN) announced a pair of such deals last month with Asian CPG food company NR Instant Produce and personal care product firm Big Tree Cloud, respectively.

Deals and Funding

• Healthwell Acquisition Corp. I (NASDAQ:HWEL) has terminated its combination with Starton Therapeutics due to certain conditions not being satisfied by the November 3 outside date. Healthwell I will seek an alternative business combination.
• Worldwide Webb Acquisition Corp. (NASDAQ:WWAC) entered into both a forward-purchase agreement (FPA) and non-redemption agreement with Sea Otter Trading, Sandia Investment and YA II as it works to close its combination with Aeries Technology. Under the agreements, the three investors will reverse their redemption requests for up to 1,239,670 shares and purchase up to 3,000,000 more. In exchange for the redemption reversals, these investors will receive the equivalent of the redemption price minus $4.84 per share in a cash payment. It will be prepaid for the FPA shares and forward proceeds back to the combined company for any sales it makes over the first year of the agreement following close.

News and Rumors

• Bloomberg: Arndt Geiwitz is taking over Rene Banko’s majority voting rights of Signa Holdings and is stepping in as the chairman of the advisory board. Geiwitz is still overseeing a messy insolvency at Signa’s online sports retail unit (OTCMKTS:SSUNF), which combined with Yucaipa in 2021.
• GlobeNewswire: Mobiv Acquisition Corp (NASDAQ:MOBV) intends to enter into a lock-up waiver, effective November 7, whereby the underwriter will agree to waive certain restrictions applicable to up to 2,441,250 shares of Class B common stock and 543,300 shares of Class A common stock. Mobiv shareholders recently approved its combination with EV motorcycle maker SRIVARU.
• CNBC: Astra (NASDAQ:ASTR), which combined with Holicity in 2021, at least twice in October failed to meet liquidity requirements for a $12.5 million note from High Trail Capital and now owes back $8 million in principal.