New IPO Filing: Churchill Capital Corp. Files for $400 Million SPAC
Churchill Capital Corp. filed for a $400 million IPO very late Friday evening, with a focus on the technology and software sectors. Churchill is being led by Jerre Stead, as CEO and Director, and Michael Klein, as Chairman. This SPAC team has quite a few impressive names, from top to bottom.
In addition to Mr. Stead, who is the former Chairman and CEO of IHS Markit Ltd. (Nasdaq:INFO), and Mr. Klein, who is currently a Director of Credit Suisse and the Founder and Managing Partner of M. Klein and Company, the team includes a former member of President Barack Obama’s Cabinet (Karen Mills) and former Chairman of British Airways (Sir Martin Broughton). You can read the team’s full bios here.
This is another big SPAC from Citigroup on the heels of the $552 million Spartan Energy Acquisition Corp. However, given that Michael Klein is a Director of Credit Suisse, it’s surprising Credit Suisse is not an underwriter. Maybe they will be added at a later date or maybe there’s a conflict of interest I’m missing, but the absence was noted.
As far as structure, Churchill follows the typical Tier-1 structures found on the NYSE, except, instead of one-third of one warrant, the unit will be offering one-half of one warrant. The sponsor, which is an affiliate of M. Klein and Company, will be purchasing 12,500,000 warrants at $1.00 for total at-risk capital of $12.5 million (before over-allotment). Full summary of terms below.
Churchill Capital Corp. Summary of Terms:
- Focus: Technology / Software
- Size: $400 million
- 100% held in trust ($10.00 per share)
- $10.00 unit comprised of one share of Class A Common Stock + 1/2 of one Warrant
- Warrant call for redemption threshold: equals or exceeds $18.00 (cash or cashless exercise)
- 24 months to complete an acquisition
- Limitation on Redemption Rights: 15%
- At-risk Capital: $12.5 million (12,500,000 warrants at $1.00)
- Underwriter fees: 2.0% + 3.5% deferred.
Citigroup is sole book-runner.
Paul, Weiss, Rifkind, Wharton & Garrison LLP and Winston & Strawn LLP are Issuer’s Counsel and Underwriter’s Counsel, respectively.