Uk digital financial institution Atom Lender is eyeing up a listing in New York in what will be a key blow to London’s attempts to promote alone as a premier destination for tech IPOs.
Durham-headquartered Atom, founded in 2013 by Mark Mullen, is set to float in New York through a £700m merger with a distinctive function acquisition enterprise set up by Donald Trump’s previous commerce secretary Wilbur Ross, Sky News 1st noted.
The terms of the deal would see the digital loan company merge with Ross Acquisition Corp II and would elevate about £150m by means of a so-called PIPE – a personal expenditure in community fairness.
Programs for the deal are by now at an superior stage, sources explained to Sky News, but there was no ensure the offer would go ahead as recessionary fears and soaring inflation batter the general public markets.
Atom’s shift onto the public markets has long been the topic of speculation, with boss Mark Mullen declaring a £75m cash injection in February was “a fundamental subsequent phase on our journey towards IPO”.
The firm claimed in February that no decision had been built above a vacation spot for the floatation, on the other hand.
The SPAC was mentioned in spring of last calendar year by Ross, who has been a prominent financier on Wall Street for a long time and assisted form the US government’s ties with China for the duration of his time doing the job in the Trump administration between 2017 and 2021.
Any deal will be a main blow to London’s endeavours to encourage by itself as an intercontinental listings cash.
Politicians have introduced a appeal offensive in new months to check out and woo much more tech companies and fintechs into floating in London, with City Minister John Glen meeting bosses in February in a bid to provide London as a location to float.
Russ Shaw, main of Tech London Advocates, mentioned that a US listing for the company would be “disappointing”.
Shaw additional: “Although is it terrific to see United kingdom fintech Atom Bank likely get ready to record on the general public marketplaces, it is disappointing – if legitimate – to see a dwelling-developed fintech decide for a SPAC (Special Goal Acquisition Corporation) listing in the US compared to a listing on the London markets,” he stated.
“With its shopper foundation and enterprise anchored in the United kingdom, a London listing by Atom Bank would have been a further good milestone in supporting and strengthening the expansion of the United kingdom fintech ecosystem.
Shaw termed for choice makers to double down on the Hill Evaluate suggestions, laid out very last calendar year to raise London’s appeal as a listings capital, and include things like making the London marketplaces far more attractive to SPACs as an selection.
Programs for a SPAC merger for Atom come regardless of a slowdown this year as regulators ramp up scrutiny of the acquisition cars in the US, and companies pullback from IPOs amid market volatility.
Following a frenzy of floatation in 2021, just 78 SPAC listings were being issued in the 3-month interval finished March 31, with regular deal size valued at just fifty percent of what it was final yr, according to Pitchbook.
Analysts at Pitchbook said corporations were being pulling again from SPACs amid a broader IPO slowdown.
“In the identical way that companies pull IPO ideas alternatively than checklist all through a destructive pricing atmosphere, we feel probable SPAC targets could opt to delay or forgo any negotiations right until there is a clearer photo of the markets,” analysts at Pitchbook mentioned.