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Silverstein’s Tal Kerret seeks $250M for SPAC

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Scott Rechler has a SPAC. Rob Speyer has two. And now, Silverstein Properties’ Tal Kerret is joining the craze.

In a regulatory filing Tuesday, SilverSPAC Inc. said it intends to raise $250 million for a blank-check firm that aims to take a proptech firm public. In addition, SilverSPAC will target fintech startups and enterprise tech companies that have real estate applications.

Developer Larry Silverstein, who founded Silverstein Properties in the 1950s, will not be involved. His development firm has been investing in proptech since 2015 via Silvertech Ventures, an accelerator and VC firm co-founded by Kerret and longtime VC investor Charles Federman. (Kerret is president of Silverstein Properties and the developer’s son-in-law.)

Silvertech has worked with 29 startups to date, according to the regulatory filing. Through an affiliated venture fund, it’s also backed 17 companies, including Fundrise, a real estate investment platform, and The Guarantors, an insurance startup that acts as a co-signer on rental apartments.

SilverSPAC will draw on its relationships with Silvertech and Silverstein Properties to source and evaluate business deals. “The adoption of technology and innovation in real estate and financial services has recently reached an inflection point,” the filing said. “In this environment, the power of data and the ability to manipulate and analyze it for rapid insights has become a necessity to industry participants.”

Silverstein Properties has developed 40 million square feet of real estate, including the World Trade Center complex in Lower Manhattan. The developer owns and manages 3, 4 and 7 World Trade and is working on 2 World Trade. Silverstein is also the developer of 30 Park Place, a Four Seasons Hotel and condo tower where Larry Silverstein lives.

After blank-check firms made a comeback last year, real estate players have been swarming to the space. Nearly 20 are seeking proptech deals, citing the need to adopt digital tools in the post-Covid world.

As of Feb. 16, a total of 146 blank-check firms have gone public, raising $44.7 billion, according to SPACInsider. That’s compared to 248 blank-check firms that went public and raised $83 billion in 2020.

In the real estate world, Scott Rechler’s RXR Realty is among the latest to join the fray. Tishman Speyer has raised two SPACs (including one that will take smart-lock maker Latch public). CBRE and Crown Acquisitions have also formed blank-check vehicles. Last week, Fifth Wall Ventures’ blank-check firm raised $347 million in an IPO.

Source: The Real Deal – Silverstein’s Tal Kerret seeks $250M for SPAC

Source: https://spacfeed.com/silversteins-tal-kerret-seeks-250m-for-spac?utm_source=rss&utm_medium=rss&utm_campaign=silversteins-tal-kerret-seeks-250m-for-spac

SEC

New SPAC scrutiny demands solid forecasts

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The Securities and Exchange Commission has signaled there’s no safe harbor for merger-related forward guidance if numbers aren’t justified.

Securities and Exchange Commission concerns over forward-looking disclosures in special purpose acquisition company (SPAC) deals make it important for CFOs keep a tight rein on their financial forecasts, a securities law specialist says.

The SEC wasn’t calling for a halt to forward-looking disclosures in SPAC deals in its early-April statement on the issue, Withers partner M. Ridgway Barker told CFO Dive. Rather, it was signaling it’s going to look hard at what sponsors and target companies say about their merger for the same reason such statements are banned in traditional IPOs.

“They see these shell companies talking freely about what the future brings and they’re saying, ‘Hey, wait a minute; you wouldn’t do that in an IPO; why are you doing it now?” said Barker.

In its statement, the SEC said the safe harbor SPACs have been partly relying on in the Private Securities Litigation Reform Act (PSLRA) for legal protection doesn’t preclude it from taking action if the forward-looking guidance appears to be misleading or otherwise based on questionable data.

“A [SPAC] transaction gives no one a free pass for material misstatements or omissions,” John Coates, the SEC’s acting director of corporate finance, said in the agency’s April 8 statement.

The PSLRA was passed in 1995 to help curb frivolous M&A lawsuits.

Forecasting concern

Given the heightened scrutiny the SEC has promised, it falls to the CFO to tightly manage the forecasting process and ensure the target company and sponsor are singing from the same song sheet when they talk about performance, Barker said.

“You want to have one forecast for all purposes,” he said. “Use the same forecast for your bank credit facility, for example, that you use for the public markets, or for every other purpose.”

CFOs appropriately and commonly prepare multiple forecasts to ensure their company has an action plan for whatever kind of market they face. But only the actual forecast should get disclosed as part of the merger narrative.

“Define which is your definitive case, and make clear all those other forecasts are sensitivities for purposes of analysis, but they’re not your forecast,” he said. “You don’t want to get into a situation where, for example, somebody confuses your upside case as your final forecast or the third sensitivity that you ran through and somehow somebody concluded that was your final forecast.”

The risk of that happening isn’t remote in a SPAC deal because of the often-accelerated timeframe in which these mergers get executed.

“Things are happening pretty fast,” he said. “There are a lot of numbers moving and you just want to be thoughtful when you get to the final one, that it’s clear that’s the final one and anything else is not.”

Time pressure can be especially heavy if the sponsor is coming up against the SEC’s regulatory deadline with the deal still not closed.

Under SPAC rules, sponsors have between 18 and 24 months after they go public to find and merge with a target company. Sponsors put the money they invest, called the promote, at risk if they miss the deadline.

“Let’s assume you’re the sponsor and you’ve invested $9 million or $12 million in this $300 million SPAC deal,” he said. “Now you’re coming up to months 16, 17, 18, and all of a sudden the potential to lose that $9 million or $12 million puts a lot of pressure on you.”

It’s natural for the sponsor and target company to put the most positive spin on the numbers, but the move has to be justified.

“You’re saying, ‘I think my revenue or EBITDA over the next three years is going to be a,b,c,’” he said. “And then you get a call from the SEC saying, ‘Hey, we see that; provide us the supplemental support for that statement,’ and the SEC isn’t satisfied with the support you provide.”

The problem is compounded if the SEC makes you restate your projections.

“If you have to go out and rescind that statement, modify it, the impact on your investors from having to modify forward-looking guidance is significant,” he said. “So, that’s the kind of pressure they’re bringing to bear on the SPAC market as opposed to saying it’s a rule.”

Source: CFO Dive – New SPAC scrutiny demands solid forecasts

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Source: https://spacfeed.com/new-spac-scrutiny-demands-solid-forecasts?utm_source=rss&utm_medium=rss&utm_campaign=new-spac-scrutiny-demands-solid-forecasts

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SEC

New SPAC scrutiny demands solid forecasts

Avatar

Published

on

The Securities and Exchange Commission has signaled there’s no safe harbor for merger-related forward guidance if numbers aren’t justified.

Securities and Exchange Commission concerns over forward-looking disclosures in special purpose acquisition company (SPAC) deals make it important for CFOs keep a tight rein on their financial forecasts, a securities law specialist says.

The SEC wasn’t calling for a halt to forward-looking disclosures in SPAC deals in its early-April statement on the issue, Withers partner M. Ridgway Barker told CFO Dive. Rather, it was signaling it’s going to look hard at what sponsors and target companies say about their merger for the same reason such statements are banned in traditional IPOs.

“They see these shell companies talking freely about what the future brings and they’re saying, ‘Hey, wait a minute; you wouldn’t do that in an IPO; why are you doing it now?” said Barker.

In its statement, the SEC said the safe harbor SPACs have been partly relying on in the Private Securities Litigation Reform Act (PSLRA) for legal protection doesn’t preclude it from taking action if the forward-looking guidance appears to be misleading or otherwise based on questionable data.

“A [SPAC] transaction gives no one a free pass for material misstatements or omissions,” John Coates, the SEC’s acting director of corporate finance, said in the agency’s April 8 statement.

The PSLRA was passed in 1995 to help curb frivolous M&A lawsuits.

Forecasting concern

Given the heightened scrutiny the SEC has promised, it falls to the CFO to tightly manage the forecasting process and ensure the target company and sponsor are singing from the same song sheet when they talk about performance, Barker said.

“You want to have one forecast for all purposes,” he said. “Use the same forecast for your bank credit facility, for example, that you use for the public markets, or for every other purpose.”

CFOs appropriately and commonly prepare multiple forecasts to ensure their company has an action plan for whatever kind of market they face. But only the actual forecast should get disclosed as part of the merger narrative.

“Define which is your definitive case, and make clear all those other forecasts are sensitivities for purposes of analysis, but they’re not your forecast,” he said. “You don’t want to get into a situation where, for example, somebody confuses your upside case as your final forecast or the third sensitivity that you ran through and somehow somebody concluded that was your final forecast.”

The risk of that happening isn’t remote in a SPAC deal because of the often-accelerated timeframe in which these mergers get executed.

“Things are happening pretty fast,” he said. “There are a lot of numbers moving and you just want to be thoughtful when you get to the final one, that it’s clear that’s the final one and anything else is not.”

Time pressure can be especially heavy if the sponsor is coming up against the SEC’s regulatory deadline with the deal still not closed.

Under SPAC rules, sponsors have between 18 and 24 months after they go public to find and merge with a target company. Sponsors put the money they invest, called the promote, at risk if they miss the deadline.

“Let’s assume you’re the sponsor and you’ve invested $9 million or $12 million in this $300 million SPAC deal,” he said. “Now you’re coming up to months 16, 17, 18, and all of a sudden the potential to lose that $9 million or $12 million puts a lot of pressure on you.”

It’s natural for the sponsor and target company to put the most positive spin on the numbers, but the move has to be justified.

“You’re saying, ‘I think my revenue or EBITDA over the next three years is going to be a,b,c,’” he said. “And then you get a call from the SEC saying, ‘Hey, we see that; provide us the supplemental support for that statement,’ and the SEC isn’t satisfied with the support you provide.”

The problem is compounded if the SEC makes you restate your projections.

“If you have to go out and rescind that statement, modify it, the impact on your investors from having to modify forward-looking guidance is significant,” he said. “So, that’s the kind of pressure they’re bringing to bear on the SPAC market as opposed to saying it’s a rule.”

Source: CFO DiveNew SPAC scrutiny demands solid forecasts

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://spacfeed.com/new-spac-scrutiny-demands-solid-forecasts?utm_source=rss&utm_medium=rss&utm_campaign=new-spac-scrutiny-demands-solid-forecasts

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With Its SPAC Merger Complete, Paysafe Is Ready for a Turnaround

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Now that the hype phase has faded, enterprising investors can scoop up shares of PSFE stock for a cheaper price

On March 31,  Paysafe (NYSE:PSFE) made its debut on the New York Stock Exchange. With Paysafe finally having completed its merger with Foley Trasimene Acquisition II, many traders were eager to get their hands on PSFE stock.

Bill Foley, the founder of Foley Trasimene Acquisition II, now serves as the chairman of the board of directors at Paysafe. Foley is something of a celebrity in the world of business, so he brings a measure of prestige and expertise to Paysafe.

Moreover, the merger deal grabbed the market’s attention as the transaction, at its closing, reflected an implied pro-forma enterprise value of roughly $9 billion.

So we can see why there’s been so much attention surrounding  Paysafe’s reverse merger. But should investors buy its shares now? That’s the billion-dollar question. Let’s start off with a breakdown of the stock’s recent price history.

A Closer Look at PSFE Stock

The announcement of Foley Trasimene’s merger with Paysafe took place on Dec. 7, 2020. At that time, PSFE stock was trading as Foley Trasimene Acquisition Corp. II, and its share price had been close to $10 for a while.

Upon the announcement, however, the share price quickly moved higher. In fact, on Jan. 21,, the stock reached a 52-week high of $19.57.

Sometimes special purpose acquisition company (SPAC) stocks will pop and then quickly drop. This can happen after the initial burst of post-deal-announcement enthusiasm fades.

In the case of BFT stock, excitement about the transaction waned in February and March and the share price dropped. By April 16, the shares were trading at $13.49.

The decline was not bad for those who had been waiting for the “hype phase” to pass. Some folks might recommend waiting until the stock gets back to the $10 area before taking a positive position in the name.

Yet I’m not against the idea of starting a bullish position now and then adding to it if the price continues to decline.

Venturing Into i-Gaming

You might know Paysafe as a pioneer in digital commerce. That’s true, but there’s another angle that adds significant value to Paysafe’s business.

I’m referring to Paysafe’s venture into i-gaming. Paysafe bills itself as having a “Long history as the global market leader in iGaming payments.”

Moreover, Paysafe asserts that the company is “well-positioned to capitalize on the expanding US iGaming market.”

The company is moving into i-gaming primarily with its iGaming eCash network. This network offers proprietary digital currency solutions “empowering online, mobile and in-app commerce for gamers & cash consumers.”

Impressively, the iGaming eCash network already has a presence in more than 50 markets. Apparently, the network’s main target demographics include Generation Z, Millennials and under-banked consumers.

I believe that it’s a smart move to target these demographics. There’s a vast army of young gamers out there, and Paysafe is making an early and aggressive move into the financing of i-gaming.

A Notable Upgrade

Ratings firm Moody’s (NYSE:MCO) is, to say the least, not easy to impress. Moody’s is known for issuing harsh ratings sometimes  and then backing up those ratings with persuasive arguments.

Moody’s outlook on Paysafe seems to  mostly positive . The firm recently upgraded its rating on Paysafe from “B3” to “B1,” which is a substantial improvement.

Not only that, but Moody’s changed its outlook on Paysafe from “ratings under review” to “stable.” “Stable” might not sound like a huge compliment, but coming from Moody’s, it’s actually pretty good.

Moody’s seemed to indirectly reference the i-gaming angle when it cited “positive growth dynamics from the deregulation of online gaming in the US market.”

Furthermore, Moody’s mentioned Paysafe’s “good liquidity,” which it said is supported by “a solid free cash flow (FCF) generation and access to its $225 million revolving credit facility (RCF).”

The Bottom Line

As you can see, Paysafe’s SPAC merger has been getting a lot of attention. Some of that is due to Foley’s reputation.

However, there are other reasons to invest in PSFE stock. Among them is Paysafe’s venture into financing i-gaming.

And if Paysafe is good enough to impress Moody’s, then perhaps it’s time to consider owning some shares of the stock.

Source: InvestorPlaceWith Its SPAC Merger Complete, Paysafe Is Ready for a Turnaround

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://spacfeed.com/with-its-spac-merger-complete-paysafe-is-ready-for-a-turnaround?utm_source=rss&utm_medium=rss&utm_campaign=with-its-spac-merger-complete-paysafe-is-ready-for-a-turnaround

Continue Reading

SPACS

With Its SPAC Merger Complete, Paysafe Is Ready for a Turnaround

Avatar

Published

on

Now that the hype phase has faded, enterprising investors can scoop up shares of PSFE stock for a cheaper price

On March 31,  Paysafe (NYSE:PSFE) made its debut on the New York Stock Exchange. With Paysafe finally having completed its merger with Foley Trasimene Acquisition II, many traders were eager to get their hands on PSFE stock.

Bill Foley, the founder of Foley Trasimene Acquisition II, now serves as the chairman of the board of directors at Paysafe. Foley is something of a celebrity in the world of business, so he brings a measure of prestige and expertise to Paysafe.

Moreover, the merger deal grabbed the market’s attention as the transaction, at its closing, reflected an implied pro-forma enterprise value of roughly $9 billion.

So we can see why there’s been so much attention surrounding  Paysafe’s reverse merger. But should investors buy its shares now? That’s the billion-dollar question. Let’s start off with a breakdown of the stock’s recent price history.

A Closer Look at PSFE Stock

The announcement of Foley Trasimene’s merger with Paysafe took place on Dec. 7, 2020. At that time, PSFE stock was trading as Foley Trasimene Acquisition Corp. II, and its share price had been close to $10 for a while.

Upon the announcement, however, the share price quickly moved higher. In fact, on Jan. 21,, the stock reached a 52-week high of $19.57.

Sometimes special purpose acquisition company (SPAC) stocks will pop and then quickly drop. This can happen after the initial burst of post-deal-announcement enthusiasm fades.

In the case of BFT stock, excitement about the transaction waned in February and March and the share price dropped. By April 16, the shares were trading at $13.49.

The decline was not bad for those who had been waiting for the “hype phase” to pass. Some folks might recommend waiting until the stock gets back to the $10 area before taking a positive position in the name.

Yet I’m not against the idea of starting a bullish position now and then adding to it if the price continues to decline.

Venturing Into i-Gaming

You might know Paysafe as a pioneer in digital commerce. That’s true, but there’s another angle that adds significant value to Paysafe’s business.

I’m referring to Paysafe’s venture into i-gaming. Paysafe bills itself as having a “Long history as the global market leader in iGaming payments.”

Moreover, Paysafe asserts that the company is “well-positioned to capitalize on the expanding US iGaming market.”

The company is moving into i-gaming primarily with its iGaming eCash network. This network offers proprietary digital currency solutions “empowering online, mobile and in-app commerce for gamers & cash consumers.”

Impressively, the iGaming eCash network already has a presence in more than 50 markets. Apparently, the network’s main target demographics include Generation Z, Millennials and under-banked consumers.

I believe that it’s a smart move to target these demographics. There’s a vast army of young gamers out there, and Paysafe is making an early and aggressive move into the financing of i-gaming.

A Notable Upgrade

Ratings firm Moody’s (NYSE:MCO) is, to say the least, not easy to impress. Moody’s is known for issuing harsh ratings sometimes  and then backing up those ratings with persuasive arguments.

Moody’s outlook on Paysafe seems to  mostly positive . The firm recently upgraded its rating on Paysafe from “B3” to “B1,” which is a substantial improvement.

Not only that, but Moody’s changed its outlook on Paysafe from “ratings under review” to “stable.” “Stable” might not sound like a huge compliment, but coming from Moody’s, it’s actually pretty good.

Moody’s seemed to indirectly reference the i-gaming angle when it cited “positive growth dynamics from the deregulation of online gaming in the US market.”

Furthermore, Moody’s mentioned Paysafe’s “good liquidity,” which it said is supported by “a solid free cash flow (FCF) generation and access to its $225 million revolving credit facility (RCF).”

The Bottom Line

As you can see, Paysafe’s SPAC merger has been getting a lot of attention. Some of that is due to Foley’s reputation.

However, there are other reasons to invest in PSFE stock. Among them is Paysafe’s venture into financing i-gaming.

And if Paysafe is good enough to impress Moody’s, then perhaps it’s time to consider owning some shares of the stock.

Source: InvestorPlace – With Its SPAC Merger Complete, Paysafe Is Ready for a Turnaround

Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://spacfeed.com/with-its-spac-merger-complete-paysafe-is-ready-for-a-turnaround?utm_source=rss&utm_medium=rss&utm_campaign=with-its-spac-merger-complete-paysafe-is-ready-for-a-turnaround

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