How New SPAC Music Acquisition Corp. Will Spend Its $230M IPO Money

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Music Acquisition Corporation raised $230 million in a Feb. 3 initial public offering for the sole purpose of acquiring a private music company and taking it public.

Geffen in December 2019, Jacobson says he has learned"the ins and outs of a SPAC," whereas Lowen already had years of experience."We've been working on this for over a year," says Jacobson, who also owns Hallwood Media, a producer and songwriter management firm. they know what company will be acquired. Investors get an up-or-down vote on a SPAC's merger and will be repaid if MAC does not close a deal within two years of the IPO.

Since SPAC investors are attracted a high-growth narrative, MAC will also consider a music-focused technology or social media company. Or MAC's target, says Jacobson, "may not be a fundamental music company but music is in the next iteration of their growth strategy." MAC hopes to spend its IPO proceeds on a high-growth company with about a $1 billion valuation. It must return shareholders their money if doesn't close a deal within two years of the public offering. Size is important since a lower valuation won't interest large investors with portfolios in the many billions of dollars, Lowen explains.The target company also needs a good story to sell investors.

Music is a relative newcomer to SPACs, compared to bigger industries that have jumped headfirst into the market. No household name music moguls have yet entered the fray, but it's easy to imagine successful entrepreneurs such as Jay-Z or Diddy, or frequent startup investor David Guetta, being either a SPAC founder or advisor. In addition to attracting investors, music celebrities could leverage their relationships and expertise to help a company expand.

 

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Wow great $230 million in Feb.. I am Music Fan billboard

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