Novo Tellus Alpha Acquisition registers final prospectus for Spac listing on SGX

SINGAPORE - A third special purpose acquisition company (Spac) in Singapore has registered its final prospectus with the Monetary Authority of Singapore, paving the way for its listing on the Singapore Exchange (SGX) mainboard.

Novo Tellus Alpha Acquisition (NTAA), a blank-cheque firm set up by Singapore-based buyout fund Novo Tellus Capital Partners, will launch its initial public offering (IPO) at 8pm on Thursday (Jan 20) following its registration.

The offer closes at noon on Jan 25.

NTAA is the third Spac to go for a mainboard listing after Vertex Technology Acquisition Corp and Pegasus Asia, after the exchange introduced its Spac listing framework in September last year.

NTAA is offering 10 million units at $5 apiece, consisting of 9.5 million in the international placement tranche and 500,000 under the Singapore public offer.

Trading of the units will commence on a "ready" basis at 9am on Jan 27.

Spacs are investment vehicles that raise money from the public with the intentions of merging with a private company - a de-Spac target - and taking it public.

NTAA has said that it is looking at targets in the technology and industrial sector in the Indo-Pacific.

In an interview with The Straits Times, its executive chairman and chief executive Loke Wai San noted that companies in this sector are going to benefit from the current macro trends of technology development and demands for the likes of cloud computing infrastructure.

The region also benefits from supply and manufacturing growth, he added.

A group of 13 cornerstone investors are taking up 16 million units in the IPO equating to gross proceeds of $80 million, while Novo Tellus is itself subscribing to four million units.

Among the 13 is Temasek-owned Venezio Investments, which has subscribed to 1.5 million units or 5 per cent of the Spac's market capitalisation post-offering.

The Spac's total market capitalisation would be $150 million upon listing.

Responding to questions on possible de-Spac targets, Mr Loke said the "logical size would be a $500 million to $1 billion" one, based on the $150 million which the Spac is looking to raise in its IPO.

Mr Loke, who is also founder and CEO of Novo Tellus Capital Partners, did not rule out the possibility that one of Novo Tellus' portfolio companies could be a target, but reiterated that "the market is bigger than what we have".

But to that end, there are safeguards in place in the case of a related party transaction, he said, including how the management team - who are also the leaders of Novo Tellus Capital Partners - cannot vote on the transaction.

Speaking about the value which NTAA brings to the table, as one of the first few Spacs to be listed on the SGX, Mr Loke noted how Novo Tellus has demonstrated a track record of building value on the SGX.

The fund manager has several listed companies under its umbrella, including semiconductor solutions provider AEM and industrial automation solutions player ISDN Holdings.

"I think companies want to look for a partner who has that experience. You'll come under fire for sure, you'll have a bad quarter for sure - (but) are you calm under fire, is the question," Mr Loke said, reiterating the skill set that Novo Tellus brings to the table.

In a media and analysts’ briefing on Thursday, Mr Loke said that the de-Spac target will likely be a company that is profitable, and could include companies within private equity portfolios and corporate carve-outs of divisions within conglomerates or multinational corporations. 

On Wednesday, Vertex Technology Acquisition Corp, Singapore's first listed Spac, announced that it saw the public offer tranche 36 times subscribed at the close of its IPO. Its units start trading on the SGX mainboard at 2pm on Thursday.

Venezio Investments is also a cornerstone investor in Vertex's Spac.

Pegasus Asia will begin trading on Friday.