Pioneer SPAC withdraws $ 2.2 billion merger by investing in Acorns

(This January 18 story in paragraph 5 means the previous value of money is $ 1.5 billion, not $ 1.6 billion).

By Sohini Podder and Manya Sai

(Reuters) – Special purpose Pioneer Merger Corp. and investment application Acorns Grow have canceled a $ 2.2 billion merger deal, according to regulations unveiled on Tuesday.

The deal, announced in May last year, was expected to close in the second half of 2021 and Irvine, a California-based company, was to be listed on the Nasdaq.

Acorn will pay Pioneer $ 17.5 million in monthly payments through Dec. 15, according to the agreement.

“Given the market conditions, we will focus on raising private capital with a higher valuation of money,” CEO Noah Kerner told Reuters.

Kerner did not disclose what assessment Acorns was targeting. A source familiar with the matter said the canceled merger was worth more than $ 1.5 billion.

The source added that the company was also considering a public listing through an initial traditional public offering (IPO) later, but did not give a specific timeline.

Blank-check firms, or SPACs, are public investment vehicles that are merged with a private company to make them public, thereby eliminating problems associated with traditional IPOs.

The trend of listing using SPACs has recently disappeared, with shares of several companies such as Grab Holdings and BuzzFeed joining the SPAC after it went public.

A tightening of regulations on the wider white check market has torpedoed some deals, such as sports card company Topps and cannabis producer Parallel.

Among others PayPal Holdings Inc. (NASDAQ :), BlackRock (NYSE 🙂 and Comcast Corp. (NASDAQ :), Acorns allows users to invest in stocks and bonds and uses a subscription-based model.