Thiel, Pacific Century launch second Southeast Asia SPAC

The first SPAC – sponsored by Thiel Capital and Li’s Pacific Century Group and PineBridge Investments – raised $550 million at the end of last year. It has since been linked to a potential merger with Indonesian e-commerce platform Tokopedia. According to Bloomberg, the deal is still under consideration, but Tokopedia is also exploring an $18 billion combination with ride-hailing and local services giant Gojek.

The latest SPAC, known as Bridgetown 2 Holdings, is looking to raise $200 million through the sale of 20 million class A ordinary shares for $10 apiece. There is an overallotment option of three million shares. The sponsor entity will acquire $5.5 million in class A shares, while affiliates of the sponsor – including FWD, an insurer controlled by Pacific Century – will invest a further $70 million. The approach is like that of the first SPAC, where affiliates put in $200 million.

As is standard practice for these structures, the sponsor and management have subscribed to class B shares for a nominal sum that will convert into a 20% stake in the entity on completion of the offering.

However, Bridgetown 2 differs from its predecessor – and the industry norm – in that there are no warrants. Typically, SPAC offerings feature units comprising ordinary shares and warrants. Once a target is identified, a majority of investors must vote in favor of the transaction. On completion, they can exercise their warrants and purchase shares or redeem some or all their shares for cash. If there is no deal within 24 months of the offering, investors get their money back.

The management team is the same as for the first SPAC, with Daniel Wong, a senior vice president at Pacific Century, serving as CEO and CFO, while Matt Danzeisen, head of private investments at Thiel Capital, takes the chairman role. Other directors include Samuel Altman, formerly president of Y Combinator, John Hass, a partner at RRE Ventures, and In Joon Hwang, CFO of Line Corporation.

Bridgetown 2 will focus on technology, financial services, and media businesses in Southeast Asia, with the option of targeting South Asia as well. “We believe this growth in these new economy sectors will be driven by private sector expansion, technological innovation, a growing young and middle-class population, increasing consumption, structural economic and policy reforms and demographic changes in the region,” the prospectus states.

Various Asia-based private equity executives have listed SPACs on US bourses as interest in these structures continues to rise globally. Only four in Asia have been sponsored by GPs: New Frontier Group used a SPAC to buy Chinese hospital operator United Family Healthcare; CITIC Capital launched a structure to pursue opportunities tied to the Belt & Road Initiative; Korea’s ACE Equity Partners is using a SPAC for IT infrastructure deals; and Vickers Venture Partners is raising one for technology deals.

Other Asia-related SPACs have been launched by individuals with experience in the private equity industry. They include Ravi Thakran, formerly head of L Catterton’s Asia operation, Peter Kuo, a co-founding partner at Canyon Bridge Capital Partners, Raymond Zage, CEO of Tiga Investments and previously Asia head at Farallon Capital, and Kenneth Ng, a founding member of Elliot Management’s Asian arm.

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• Topics
• Southeast Asia
• IPO
• Fundraising
• Technology
• Financials
• PineBridge Investments
• TMT
• SPAC