United Talent Agency’s $200 Million Gaming SPAC Lands on the Nasdaq
Harri is dot.LA's senior finance reporter. She previously worked for Gizmodo, Fast Company, VentureBeat and Flipboard. Find her on Twitter and send tips on L.A. startups and venture capital to harrison@dot.la.
One of the world’s largest talent agencies launched its first SPAC on the Nasdaq exchange on Thursday. United Talent Agency’s UTA Acquisition Corp. raised $200 million in the IPO, fueling its efforts to snap up a “compelling” gaming or creator economy business.
UTA represents stars such as Harrison Ford and Bad Bunny, as well as popular pro gamers like Symfuhny. The creation of the SPAC (a shell company designed to take another business public) reflects UTA’s growing interest in esports, as the Beverly Hills-based agency eyes ways to boost its music stars through collaborations with gaming giants (see: Marshmello’s Fortnite concert).
Trading under the symbol “UTAAU,” some prominent names are involved in managing the SPAC, including former Nintendo of America president Reggie Fils-Aimé, former Google business development executive Jamie Sharp, and investor and Reddit co-founder Alexis Ohanian.
The SPAC managers are hunting for a company with “compelling intellectual property and communities,” a “team with proven track record,” and “potential to leverage new technologies across multiple dimensions,” according to a regulatory filing. The managers set a deadline of 21 months to find their target, which they say will operate “in the gaming, digital media, creator economy, entertainment and technology industries.”
Like most SPACs, UTA Acquisition Corp. set pricing for 20 million shares at $10 a pop. On Thursday the stock closed at $10.02 per share.
If the venture succeeds, UTA and the other sponsors of the SPAC will reverse-merge the shell company with a gaming or adjacent business, and walk away with a considerable stake in the resulting entity (often 20%).
SPACs have risen in popularity in recent years as a vehicle to take businesses public, typically quicker and at a lower upfront cost than a traditional IPO. However, the U.S. Securities and Exchange Commission has scrutinized the practice and warned investors about the risks involved in such deals, which typically perform worse than traditional IPOs.Harri is dot.LA's senior finance reporter. She previously worked for Gizmodo, Fast Company, VentureBeat and Flipboard. Find her on Twitter and send tips on L.A. startups and venture capital to harrison@dot.la.
