Bran­son seeks $460m for listed blank-cheque ven­ture

The Daily Telegraph - Business - - Business - By James Tit­comb

in San Fran­cisco SIR RICHARD BRAN­SON plans to raise up to $460m (£355m) for a pub­licly listed blank-cheque com­pany run by the bil­lion­aire’s Vir­gin Group.

VG Ac­qui­si­tion Corp, a spe­cial pur­pose ac­qui­si­tion com­pany (SPAC), said in a US fil­ing on Wed­nes­day that it planned to raise be­tween $400m and $460m on the New York Stock Ex­change. The funds will be used to buy or invest in com­pa­nies that the Vir­gin brand will be at­tached to.

SPACs have re­cently be­come fash­ion­able on Wall Street as a way to tap vig­or­ous in­vestor de­mand for pub­lic stocks, and many well-known in­vestors have started their own. In­vestors back the ve­hi­cle, whose shares trade on the stock market as it iden­ti­fies op­por­tu­ni­ties. Pri­vate com­pa­nies typ­i­cally merge with the SPAC, tak­ing them pub­lic in a so-called “re­verse list­ing”.

Sir Richard’s space tourism com­pany Vir­gin Ga­lac­tic went pub­lic last year by merg­ing with a SPAC run by early Facebook em­ployee and Sil­i­con Val­ley in­vestor Chamath Pal­i­hapi­tiya, in a deal that was seen as set­ting off the cur­rent boom.

VG Ac­qui­si­tion Corp will be led by Josh Bayliss, Vir­gin Group chief ex­ec­u­tive, with Sir Richard listed as its “founder”.

Sir Richard will have a 19pc stake, and will invest up to $11.2m in ex­change for the right to buy shares at a fixed price later on. The ve­hi­cle said it would look for a target com­pany in one of Vir­gin’s key ar­eas – travel, fi­nance, health, tech­nol­ogy, mu­sic and en­ter­tain­ment, me­dia, tele­coms or en­ergy – and would be seek­ing a con­sumer-fac­ing busi­ness that it would at­tach the Vir­gin brand to.

It said the coro­n­avirus pan­demic cre­ated an op­por­tu­nity to invest in busi­nesses at “at­trac­tive val­u­a­tions”.

SPACs have al­ready raised al­most three times more than the $13.6bn they raised last year, it­self a record, with high-pro­file in­vestors such as Bill Ack­man start­ing such ve­hi­cles.

Vet­eran Sil­i­con Val­ley ven­ture cap­i­tal in­vestor Bill Gur­ley has pro­moted them as a way to avoid the high banker fees charged when a com­pany typ­i­cally goes pub­lic.

Sir Richard had planned to fur­ther ex­pand the Vir­gin name in the US, but sev­eral of his ven­tures, such as cruises and ho­tels, have strug­gled dur­ing the pan­demic. Vir­gin At­lantic, the air­line that he holds a 51pc stake in, has cut thou­sands of jobs and re­cently agreed a £1.2bn res­cue deal that in­cludes new cash from Vir­gin Group.

Sir Richard Bran­son will have a 19pc stake in VG Ac­qui­si­tion Corp and will invest up to $11.2m

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