Bernard Arnault and Jean Pierre Mustier Spac raises € 500 million in Amsterdam
The specific-purpose acquisition vehicle created by LVMH CEO Bernard Arnault and former UniCredit director Jean Pierre Mustier to invest in European financial companies has been listed in one of the largest European Spacs investments ever recorded .
Pegasus Europe raised 500 million euros when it was listed on Euronext Amsterdam on Thursday morning, making it one of the biggest European Spacs in the vehicle crop of the year. The Spacs are listed on the stock exchange, then look for acquisition targets to be made public. The shares were priced at € 10.
The deal reflects European efforts to emulate the explosive growth of Spacs in the United States. “We have a lot of SMEs in Europe that need raw capital to grow,” said Mustier. “The Spac is an important and good instrument for Europe.”
The listing was sponsored by Paris-based asset manager Tikehau Capital, Financière Agache (a holding company controlled by the Arnault and Mustier business group) and former Bank of America trader Diego De Giorgi.
The sponsors jointly invested € 55m in the private listing and € 12.75m in warrants to cover commissions and costs. They also pledged an additional investment of € 100 million, to be used by Pegasus when a suitable target company is found.
“We are missing a skin in the game [in Spac investing], people put their own money, ”said Antoine Flamarion, co-founder of Tikehau Capital.
Spacs are widely listed on the US markets, including more than 300 blank check IPOs since the start of the year. They have accounted for nearly half of the record-breaking fundraising through public offerings so far in 2021.
But Pegasus is part of an expected European wave, with Tikehau Capital among those planning additional vehicles for blank checks. 2MX Organic, a Spac founded by telecoms billionaire Xavier Niel to invest in organic food, raised 300 million euros last year as part of the largest public offering on the Paris market in 2020.
“We expect the European market to continue to grow. By August, we expect more than 30 Spacs, if the market permits, ”said Giacomo Ciampolini, head of alternative capital at Citi, who were bookkeepers on the deal alongside JPMorgan. “Europe is still a relatively virgin hunting ground.”
The move to list Pegasus in Amsterdam, which has already benefited from London’s exit from trading of euro-denominated shares after the UK left the EU, could make it the emerging center of Europe for Spacs.
In the United States, however, pipeline financing – short for private investment in public capital – has dried up after the proliferation of transactions over the past year. The Securities and Exchange Commission has also raised concerns about revenue and profit forecasts for transactions, increasing investor uncertainty.
“We expect more accounting clarity in the coming weeks, which should lead to an acceleration of issuance in the US market,” Ciampolini said.