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Hudson Executive Captial to float SPAC on Nasdaq
Posted on Friday, 22 May 2020 09:32
Special purpose acquisition company (SPAC) Hudson Executive Investment is floating on Nasdaq by way of an initial public offering worth as much as USD 345.00 million.
Citigroup and JPMorgan are handling the offering, which comprises 30.00 million units at USD 10.00 apiece, as well as an overallotment option for a further 4.50 million securities.
Sponsor Hudson Executive Capital has committed to buying 8.00 million private placement warrants: they are fully exercisable into one share at USD 11.50 each.
The value-oriented hedge fund established the SPAC to pursue a business combination in any industry, sector or geographic region.
However, the cash shell intends to initially start its search on two broad sectors: financial services, with a focus on financial technology (FinTech); and healthcare, including information technology, services and products.
According to the prospectus, these two areas represent attractive target markets given their size, breadth and prospects for growth.
“The products and services related to these industries are pervasive in the context of governments, corporations, and individuals alike”, it noted.
As “candidates for elected government offices focus on healthcare and financial services more broadly in the current political cycle”, the SPAC “believes further opportunities are likely to be created”.
There are several areas in particular with significant opportunities, including payments; insurance, wealth, regulation and capital markets technology; management; infrastructure; and specialty and real estate finance.
In the healthcare sector, fields ripe for investment range from data and analytics to life sciences such as medical devices, diagnostics and distribution.
According to the US Bureau of Economic Analysis cited in the prospectus, the financial services industry was projected to reach USD 1,600 billion in 2019.
It is expected to grow at a 4.6 per cent compound annual growth rate (CAGR) from 2017 to 2019.
Global investment in the FinTech sector has grown rapidly in the past decade, increasing by a CAGR of 53.0 per cent from USD 1.9 billion in 2010 to USD 55.3 billion in 2018.
According to the Center for Medicare and Medicaid Services cited in the prospectus, total US national health expenditure was projected to reach USD 3,800 billion in 2019, and total spending should grow at a 5.7 per cent CAGR through 2027.
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