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Constellation in Nasdaq IPO
Posted on Friday, 19 May 2017 12:31
Constellation Alpha Capital is looking to raise as much as USD 143.76 million by way of an initial public offering (IPO) on Nasdaq as part of the special purpose acquisition company’s (SPAC’s) aim to complete its first business combination.

The cash shell was incorporated in the British Virgin Islands in July 2015 for the purchase of buying, taking part in a share exchange, stock reconstruction and amalgamation with, buying all or most of the assets of, an entity in India.

While it is not ruling anything out, the SPAC intends to focus on healthcare service and manufacturing business in the country expected to become the world’s fifth-largest economy by 2020, according to the IPO prospectus.

Following the Modi government’s election in 2013 and its reform policies, India became the fastest-growing economy in 2015 with over USD 1,000 billion in gross domestic product.

Constellation has decided to focus on healthcare in order to gain robust exposure to this development without the volatility associated with those industries linked with commodity prices and monetary policy.

Rapid urbanisation is driving spending in its predetermined target sector and this is expected to rise by USD 100.00 billion between 2013 and 2018 but investment is needed in order to meet an increase in demand.

As a foreign investor, Constellation is avoiding those industries which the government either prohibits or puts a cap on inbound mergers and acquisitions or are regulated by periodical scrutiny, such as banking.

Constellation is merely the latest in a number of SPAC’s which have announced or completed an IPO in the US in 2017 to date, according to Zephyr, the M&A database published by Bureau van Dijk.

In terms of those cash shells incorporated in the States, Silver Run Acquisition Corporation II currently accounts for the largest listing by value (USD 1.04 billion) so far this calendar year.

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