In SPAC news this week, Cepton Technologies announced it has entered into a definitive business combination agreement with Growth Capital Acquisition, while Sky Harbour said it is coming public via Yellowstone Acquisition merger.

CEPTON, GROWTH CAPITAL COMBINATION: Cepton and Growth Capital Acquisition (GCAC), a publicly traded special purpose acquisition company, announced that they have entered into a definitive business combination agreement, as well as related subscription agreements for an aggregate $58.5M private placement in connection with the business combination. Upon the closing of the transaction, the combined company will be renamed "Cepton, Inc." and is expected to be listed on the Nasdaq stock exchange under the new ticker symbol "CPTN." Under the terms of the Business Combination Agreement, Cepton shareholders will receive consideration in the form of newly issued shares of Growth Capital common stock, valued based upon a Cepton enterprise value of $1.5B on a cash-free, debt-free basis.

Upon closing, the combined company is expected to have an estimated equity value of approximately $1.8B, which includes approximately $231M in gross proceeds, comprised of $172.5M from Growth Capital's trust account and a $58.5M fully committed common stock PIPE, anchored by existing investor KOITO, which satisfies the contractual closing cash condition. Cash proceeds released from Growth Capital's initial $172.5M trust account after any stockholder redemptions and payment of transaction expenses and other Growth Capital liabilities will remain with the combined company, and Cepton intends to use the aggregate cash proceeds to accelerate its growth strategy, including securing additional series production design wins at other Top 10 automotive OEMs. The boards of directors for both Cepton and Growth Capital have unanimously approved the proposed business combination, which is expected to be completed in the fourth quarter of 2021.

SKY HARBOUR, YELLOWSTONE ACQUISITION MERGER: Sky Harbour, or "SHG," a developer of private aviation infrastructure focused on building, leasing and managing business aviation hangars, announced it has entered into a business combination agreement with Yellowstone Acquisition Company (YSAC), a publicly traded special purpose acquisition company sponsored by Boston Omaha Corporation (BOMN). Upon closing of the business combination, SHG will become a publicly traded company, and it is expected that its common stock will be listed on the NASDAQ exchange. The combined company will have an implied pro forma equity market value of approximately $777M at closing. Boston Omaha, through one of its subsidiaries, has agreed to provide $55 million of financing in support of the transaction, which will be funded prior to the closing of the business combination, assuming SHG successfully raises at least $80M in a private activity bond offering. This additional equity investment will initially be directly into SHG, and upon the successful consummation of the business combination will convert into 5,500,000 shares of the post-combination public company's Class A common stock, at a price of $10 per share. In the event the business combination is not consummated, Boston Omaha's investment will remain as Series B Preferred units of SHG. In addition, the parties will seek to raise additional funding to support the business combination through a private placement investment, or "PIPE," to be consummated at the closing of the transaction of $100M.


ANALYST COVERAGE INITIATIONS:

Loop Capital analyst Daniel Adam initiated coverage of Horizon Acquisition (HZAC) with a Buy rating and $12 price target. Horizon Acquisition is a blank check, special purpose acquisition company formed for the purpose of merging with one or more businesses, and on April 21 it entered into a merger agreement with live event ticketing company Vivid Seats. Upon closing, Horizon will merge with Vivid Seats and the stock will trade under as "SEAT" on the Nasdaq. While the analyst sees risks associated with investing before the merger closes, he feels "the positives outweigh the negatives," citing pent up demand for live experiences.


SPAC IPOS THIS WEEK:

• Nova Vision Acquisition (NOVV) opened on August 6 at $10. Nova Vision anticipates target companies that focus in the fintech, proptech, consumertech, and supply chain management industries or technology companies that serve these or other sectors.
• Riverview Acquisition (RVAC) opened on August 6 at $9.90. Riverview intends to focus on combining with consumer-focused enterprises, including e-commerce, on the energy services and renewables sector and on the insurance and financial services sector.
• Roth CH Acquisition IV (ROCG) opened on August 6 at  $10.
• Gladstone Acquisition (GLEE) opened on August 5 at $10. The company intends to focus its search on the farming and agricultural sectors, including farming related operations and businesses that support the farming industry.
• Blue Whale Acquisition Corp. I (BWC) opened on August 4 at $9.91. The company is sponsored by Mubadala Capital, the asset management subsidiary of Mubadala Investment Company PJSC.
• AMCI Acquisition Corp. II (AMCI) opened on August 4 at $9.90. The company intends to focus on investment opportunities centered around the themes of sustainability, decarbonization and energy transition.
• Healthwell Acquisition Corp. I (HWEL) opened on August 4 at $9.90. The company said it intends "to leverage our team's expertise to target businesses in healthcare technology, tech-enabled healthcare services, and tech-enabled wellness."

"On the Fly: The Week in SPAC News" is The Fly's new recurring series of stories on the latest SPAC initial public offerings, SPAC deal news, and associated analyst commentary.