Israeli cybersecurity solutions company HUB Security (TASE: HUB) announced this morning that it has signed a memorandum of understanding (MoU) to merge with a special purpose acquisition company (SPAC), which is traded on Nasdaq. The SPAC, a blank check company set up to merge with an existing company, has raised $150 million from its shareholders. No valuation for the merged company was provided.
Under the terms of the MoU, the SPAC which was not named, will work to raise more money as part of private investment public equity (PIPE). The holdings of HUB's shareholders after the merger will be between 75%-90%, after completion of the merger, "On the assumption that the final valuation that it set for the merger transaction does not change and subject to the amount of redemptions from the cash held under trust for the SPAC investors and the amount of PIPE money that the company will raise."
HUB Security also said that if the net amount of cash of the merged company after shareholders redemption and the PIPE money raised is less than $100 million, then HUB will have the right to cancel the deal.
HUB Security provides cybersecurity solutions for cloud computing and data centers. Its flagship Hub-on-Chip solution, reduced to IoT, is for credit cards, cars. Cameras and the like. The company is traded on the TASE at a market cap of NIS 411 million, after its share price rose 140% in 2021. The share price was up 11% this morning before trading was halted after the SPAC announcement.
Published by Globes, Israel business news - en.globes.co.il - on January 31, 2022.
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