A new sports and entertainment-focused special purpose acquisition company (SPAC) whose management team includes a former Disney executive has priced its U.S. IPO at $100 million.
ESH acquisition company the stock made its NASDAQ debut on Wednesday (June 14) under the symbol ESHA.U, after offering 10 millions shares at the price of $10 per share.
ESH is looking to merge with a company in the music and entertainment, sports or hospitality sectors.
It’s according to the blank check company registration statement filed with the United States Securities and Exchange Commission (SEC).
ESH said in the filing that it “could pursue an acquisition opportunity in any industry or sector,” but said it intended to capitalize on the experience of its board members. of directors in the fields of sports, hospitality or music and entertainment, “including destination and regional theme parks, water parks, concert halls, theaters, cinemas, record labels, music and television broadcasting services, production companies and publishing houses. (MBW in bold)
In the business prospectus filed in May 2022, The ESH has indicated that it is planning an IPO of 30 million shares at $10 per share, which would have given it a value of $300 millionmeaning its IPO was priced at one-third of the originally expected value.
“We believe the ‘experience economy’ is positioned for immediate growth and expansion and we plan to identify target companies best positioned to take advantage of these macroeconomic tailwinds, gain market share and become industry outperformers.”
According to ESH’s prospectus, “There continues to be a growing global demand for live and streaming sports and entertainment, accelerated by significant pent-at the top request due to COVID-19 pandemic and the continued growth of sur-double and mobile apps and connectivity”
He adds: “We believe the ‘experience economy’ is positioned for immediate growth and expansion and we plan to identify target companies that are best positioned to take advantage of these macroeconomic tailwinds, gain market share and become industry outperformers.”
ESH Acquisition is led by CEO and Director James Francis, founder and former CEO of Chesapeake Lodging Trust and Highland Hospitality.
The company’s president is Allen Weiss, former president of global operations for Walt Disney Parks and Resorts.
Sports star and entrepreneur Earvin “Magic” Johnson was previously appointed vice-chairman of the company’s board of directors prospectusbut is no longer a member of the board of directors according to a modified S1 deposit.
Christina Francis, president of Magic Johnson Enterprises, is named a nominee director.
SPACs boomed in 2020-21 as stock prices soared in the pandemic era. Many start-ups saw them as a faster way to get listed on the stock exchange and with less regulatory oversight.
The number of SPAC offers in the United States increased from 55 in 2019, at 239 in 2020 and 610 in 2021.
However, following the massive increase in their popularity, the SEC tightened accounting regulations surrounding SPACs in April 2021, causing their popularity to plummet. In 2022, there was a total of 86 PSPC offers in the USA.
The ESH offering is only the 18th SPAC in the United States this year, despite being near the middle of the calendar year.
The music industry has benefited from the SPAC boom while it lasted, with a number of music companies debuting publicly via a SPAC merger between 2020 and 2022.
streaming service Deezer listed on the Euronext Paris stock exchange in 2022, following a reverse merger with I2PO Société Anonyme in 2022, as part of an agreement initially assessed the company to $1.16 billion.
Music streaming service based in Lebanon and focused on the MENA region Anghami listed on NASDAQ in 2022, following its merger with Vistas Media Acquisition Company Inc. at a initial value of $220 million.
US music distributor and wholesaler Alliance Entertainment completed its merger with Adara Acquisition earlier this year, to a valuation of $480 million. The new company is now seeking a NASDAQ listing.
However, a number of SPAC deals in the music industry have failed in recent years as investors increasingly turn away from these types of mergers.
Freedom Media Acquisition Corporation, which had been created “to pursue a target in the media, digital media, music, entertainment, communications, telecommunications and technology sectors”, announced last year that it would end, having failed to find an acquisition target. SPACs generally have two years to buy a business or return their capital to investors.
Another music-focused SPAC, the Music Acquisition Corporation, delisted from the New York Stock Exchange last December, following a shareholder vote to liquidatethe company having not found a company with which to merge.
In early trading Thursday (June 15), ESH shares were trading at $10.09just below 1% of its opening price. ESH expects to close its offering on June 16.
I-Bankers Securities, Inc. and IB Capital LLC are acting as joint bookrunners for the offering, with Dawson James Securities Inc. acting as co-manager of the offering.
ESH Acquisition Corp. must engage in a first business combination within 18 month, in accordance with SEC rules.The music industry around the world