Temasek-backed Vertex files first Spac IPO prospectus, followed by Pegasus

Vertex Technology Acquisition Corp will be listed on Jan 21, while Pegasus Asia will start trading on Jan 25. PHOTO: ST FILE

SINGAPORE - Two special purpose acquisition companies (Spacs) will start trading on the Singapore Exchange (SGX) by the end of this month. 

Temasek-backed Vertex Technology Acquisition Corp (VTAC) lodged the first preliminary prospectus for an initial public offering (IPO) with the Monetary Authority of Singapore (MAS) on Thursday (Jan 6), followed within hours by Pegasus Asia. 

VTAC will be listed on Jan 21, while Pegasus will start trading on Jan 25, according to their MAS filings. 

The IPOs follow the SGX’s move last September to set up a framework to allow Spacs to list. SGX is the first Asian bourse to do so.

VTAC is seeking to raise about $170 million from the sale of 34 million units at $5 a piece in its IPO.

The offer size can be increased to about $182 million if an over-allotment option is exercised.

Its 13 cornerstone investors will subscribe to about 65 per cent of the IPO and a placement tranche will offer around 33 per cent. The retail public offer will be around 2 per cent.

Credit Suisse, DBS Bank and Morgan Stanley are the joint issue managers.
Pegasus Asia is offering 25.6 million units at $5 each while its sponsors – Tikehau Capital, Financiere Agache, Diego De Giorgi and Jean Pierre Mustier – will take up another 4.4 million units. That will put the Spac’s deal size at $150 million.

Spacs, also known as blank cheque companies, are shell entities formed by a group of investors known as sponsors who raise capital via an IPO.

The Spac has a set timeframe to target a company and deploy the funds raised to take it public.

VTAC is likely to target firms involved in cyber security and enterprise solutions, artificial intelligence, consumer Internet, fintech, autonomous driving and new energy vehicles, biotech and digital healthcare.

Singapore buyout firm Novo Tellus Capital Partners is also exploring Spac listings on the SGX.
 

These Spac IPOs may reinvigorate the Singapore capital market in a year when the amount raised in new listings has lagged behind other regional exchanges such as those in Thailand, Indonesia and the Philippines.

There were eight IPOs in Singapore last year compared with 11 in 2020. These eight listings raised around $1.7 billion, just above the $1.4 billion tally from 2020.

The SGX said last September that it will focus on the sponsors’ quality and track record.

Hong Kong became the second Asian exchange to launch a Spac framework on Jan 1.

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