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Monday, December 4, 2023

The return of SPACs? Entertainment and sports-focused ESH Acquisition Corp prices $100 million IPO


A sports and entertainment-focused special purpose acquisition company (SPAC) whose leadership team includes a former Disney executive has raised $100 million in a U.S. IPO.

ESH Acquisition Company The stock traded on Nasdaq on Wednesday (June 14) After sale under code ESHA.U Ten million share price is 10 USD per share.

ESH is seeking to merge with businesses in the music and entertainment, sports or hospitality industries.

This is according to the blank check company registration statement Filed with the US Securities and Exchange Commission (SEC).

ESH said in the filing that it “may pursue acquisition opportunities in any industry or sector,” but said it intends to leverage the experience of its board members in sports, hospitality, or music and entertainment, “including destination and regional theme parks, water parks, and , concert venues, theatres, cinemas, Record company, Music and TV streaming services, production companies and publishers. ” (bold MBW)

Also in that prospectus, ESH said it was planning an initial public offering 30 million shared with 10 USD per share, which would make its value $300 millionwhich means its IPO is priced at one-third of its planned value.

“We believe the ‘experience economy’ is positioned for immediate growth and expansion, and we plan to identify target companies best positioned to capitalize on these macro tailwinds, gain market share and become industry leaders.”

ESH point of view

According to ESH’s prospectus, “Global demand for live and streamed sports and entertainment continues to grow, accelerated by substantial-up Post-COVID needs-19 Pandemic and continued growth-Wire and mobile apps and connections”

It added: “We believe the ‘experience economy’ is positioned for immediate growth and expansion, and we plan to identify target companies best positioned to capitalize on these macro tailwinds, gain market share and become industry leaders.”

ESH Acquisition is led by Chief Executive Officer and Director James Francis, founder and former Chief Executive Officer of Chesapeake Lodging Trust and Highland Hospitality.

The company’s chairman is Alan Weiss, the former president of Walt Disney Parks and Resorts Worldwide Operations.

Sports star and entrepreneur Earvin “Magic” Johnson Previously listed as Vice Chairman of the Company prospectusbut according to Modified S1 file.

Christina Francis, President of Magic Johnson Enterprises, has been named as the nominee for director.

SPACs have seen a boom in 2020-2021 amid rising stock prices amid the pandemic. Many start-ups see them as a faster way to list on the stock market with less regulatory oversight.

The number of US SPAC offerings from 55 In 2019, to 239 2020 and 610 2021.

However, as SPACs have grown in popularity significantly, the SEC tightened accounting regulations around SPACs in April 2021, causing their popularity to plummet. In 2022, a total of 86 SPAC products In the U.S.

The ESH offering is only the 18th SPAC in the U.S. this year, even though it is approaching the midpoint of the calendar year.

The music industry has capitalized on the continued boom in SPACs, with many music companies making their stock market debuts through SPAC mergers between 2020 and 2022.

These include music rights acquisition companies reservoirwhich Listed on Nasdaq After merger with Roth CH Acquisition Co. II in 2021.initial valuation of the company exist $788 million.

streaming service Dieter Listed on Euronext Paris In a transaction following a reverse merger with I2PO Societe Anonyme in 2022 initial valuation company in $1.16 billion.

Headquartered in Lebanon, focusing on music streaming services in the Middle East and North Africa region Anhami Listed on Nasdaq 2022, following merger with Vistas Media Acquisition Company Inc. initial value $220 million.

Voice recognition company SoundHound Listed on NASDAQ in 2022 Following the merger with Archimedes Tech SPAC Partners Co., the transaction initially Value the company exist $2.1 billion.

US-based music distributor and wholesaler Alliance Entertainment completed its merger with Adara Acquisition earlier this year, valued at $480 million. The new company is now seeking to list on Nasdaq.

Over the past few years, however, many music business SPAC deals have failed as investors have increasingly moved away from these types of mergers.

free media Acquisition Corporation was formed to “find targets in the media, digital media, music, entertainment, communications, telecommunications and technology industries,” announced last year It will wind down after failing to find an acquisition target. SPACs typically have two years to buy a business, or return capital to investors.

Another music-oriented SPAC, Music Acquisition Corporation, Delisted from the New York Stock Exchange In December last year, following the shareholder vote liquidationthe company failed to find a business to combine with.

Some SPAC deals have failed, most notably 10% of universal music group (UMG) to be acquired by Pershing Square Tontine Holdings (PSTH), a SPAC run by billionaire CEO Bill Ackman.

PSTH Scrapped $4 billion trade July 2021, regarding what it called “questions from the SEC regarding several elements of the proposed transaction — in particular, whether our IBC is structured in compliance with NYSE regulations.”

As of Thursday morning (June 15), shares of ESH were trading at $10.09just below 1% from its opening price. ESH is expected to end its sale on June 16th.

I-Bankers Securities, Inc. and IB Capital LLC are acting as joint bookrunners and Dawson James Securities Inc. is acting as joint manager for the offering.

ESH Acquisition Corp. Must Make Initial Business Combination Within 18 Days A few months, according to SEC regulations.Global Music Business


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