SINGAPORE - Temasek-backed Vertex Technology Acquisition Corporation (VTAC), the first Spac listing on the Singapore Exchange (SGX), has inked a deal to buy Taiwanese live-streaming platform 17Live for up to $925.1 million.
If the deal goes through, VTAC would become Singapore’s first special purpose acquisition company to acquire a target firm. The merged company would be valued at up to $1.16 billion.
VTAC said on Monday the conditional sale and purchase agreement is subject to approval by its shareholders and SGX. It expects to secure necessary approvals by end-2023, after which the firm would be renamed 17Live Group and trade on SGX’s mainboard.
VTAC chief executive Jiang Hong Hui said: “We are proud to be the first SGX Spac to announce a business combination.”
“We are thrilled to work with the 17Live team as they continue to break new grounds in the evolving consumer-Internet space as an innovative and cutting-edge market leader.”
A Spac or blank-cheque company is created to raise capital through an initial public offering (IPO) for the purpose of acquiring or merging with a private firm.
VTAC’s merger with 17Live will see it acquire the entire issued and paid-up share capital of its target.
It proposes to finance the acquisition through the issue of 160.6 million new shares at $5 each, amounting to $803 million, to 17Live shareholders.
If 17Live hits the financial target set, an earnout of 24.4 million new shares at $5 each will be allotted to applicable shareholders, amounting to $122 million.
17Live chairman and co-founder Joseph Phua said: “Listing on SGX will allow 17Live to grow its businesses in South-east Asia and globally.”
Founded in 2015, 17Live operates the top Internet live-streaming platform by revenue in Japan and Taiwan. It also has a regional presence in Singapore, the Philippines and Malaysia. As at June, it has contracts with roughly 87,000 live-streamers.
The content on 17Live spans music, games, education and fashion, among others. Live-streamers on the platform interact and socialise in real time with users, who can send virtual gifts, which results in successful monetisation.
17Live has introduced new initiatives to drive future sustainable growth, such as V-Livers, live-streamers who use computer-generated characters to represent themselves, as well as in-app gaming and live commerce.
17Live co-founder and chief technology officer Jing Shen Ng said: “Beyond growing in Japan and Taiwan, we see opportunities for geographical expansion... We see the SGX as the perfect expansion into South-east Asian markets.
“In addition to Asia, we also see global opportunities for V-Livers specifically in the United States.”
In 2022, 17Live generated revenue of US$363.7 million (S$497 million). It has reported positive earnings before interest, taxes, depreciation and amortisation (Ebitda) since 2020.
VTAC is sponsored by Vertex Venture Holdings, a subsidiary of Singapore’s investment firm Temasek. It raised about $200 million in its IPO in January 2022.
The Spac was the first of three to list on the Singapore Exchange (SGX) in January 2022. The other two Spacs are Pegasus Asia and Novo Tellus Alpha Acquisition. The trio raised IPO proceeds of about $528 million in total.
Under the SGX framework, they have a two-year deadline from listing to identify and acquire a target company, although an extension of 12 months may be considered under prescribed conditions.
Shares of VTAC, which have risen 6.2 per cent to date this year, last traded at $4.81 on Friday.
