Good news for the slumbering SPAC market.
Shares of Ginkgo Bioworks got off to a strong start on the company’s first day of trading, rising more than 6 percent to close at $12.15 a share after the company completed its merger with the special purpose acquisition company Soaring Eagle Acquisition Corp.
This is more than 30 percent higher than Soaring Eagle’s stock price as recently as last Monday.
This is at least initially encouraging and a relief for investors who have seen the shares of many post-merger companies trade below their SPACs’ initial public offering prices of $10 a share.
In fact, in the six months after closing a deal, the median SPAC underperformed the Russell 3000 by a stunning 42 percentage points, according to a comprehensive SPAC report disseminated on Thursday by Goldman Sachs.
Since its February peak, shares of Defiance Next Gen SPAC Derived ETF, an exchange-traded fund of SPACs across stages of the blank-check company lifecycle, has declined 35 percent compared to a 14 percent gain for the S&P 500, according to Goldman.
Ginkgo Bioworks says it uses synthetic biology “to grow products instead of manufacturing them.”
The Ginkgo deal resulted in total proceeds exceeding $1.6 billion and a valuation of Ginkgo at a $15 billion enterprise value, according to a recent Ginkgo press release.
As Institutional Investor earlier reported, one of the big beneficiaries of the merger figures to be Tiger Cub Viking Global Investors.
It has been investing in the company since as far back as 2015 and was the first large institutional investor in Ginkgo, Jason Kelly, chief executive officer of Ginkgo Bioworks, said in an earlier email communication.
In a new regulatory filing made public on Friday related to the sale of a PIPE, or private investment in public equity, Soaring Eagle disclosed that Viking Global Opportunities, the hedge fund firm’s hybrid fund, is by far the largest investor, owning a little more than 339 million new Ginkgo Class A shares, or 24.6 percent of the total number of Class A shares before it began trading. It also owned 5 percent of the voting power.
These include shares acquired from participating in the $775 million PIPE deal.
Two other firms known for their hedge funds also owned more than 5 percent of the new shares: Senator Global Opportunity Master Fund LP (5.8 percent) and entities affiliated with Anchorage Capital Group (5.4 percent).
A number of other hedge funds owned much smaller stakes before the merger, all of them having participated in the PIPE for $10 per share.
These include Casdin Partners Master Fund, which owned a little more than 7.7 million shares, a portion of which was acquired through the PIPE, and entities associated with Millennium Management, which owned more than 6.9 million shares.
Other investors include Citadel, 40 North Management, Highline Capital Master Fund, and Tudor Investment Corp. through an entity called Xantium Partners.
