First SPAC to list in London following regulatory changes, Hambro Perks Acquisition Company is in advanced merger talks with drug company Istesso.
The first “blank check” business to list in London following a reorganization designed to help the City compete with rival financial centers is in merger talks with a privately owned pharmaceuticals company developing therapies for chronic ailments.
Hambro Perks Acquisition Company (HPAC) is in advanced negotiations over a potential deal, which might be revealed within the next few weeks.
If completed successfully, the merger would be a watershed moment for the London stock market at a time when scores of so-called special purpose acquisition companies (SPACs), primarily in New York, are being wound down due to a decline in values.
Saturday, city sources reported that HPAC had been in talks with Istesso for some time.
A merger would value the company at several hundred million pounds, but this weekend’s estimate was unavailable.
Istesso, a 2017 immunometabolism firm, is researching treatments for arthritis and multiple sclerosis.
Several of its items have reached the Phase-II testing stage, while others are in an earlier level of development.
According to a biotech expert acquainted with Istesso’s work, the company appears to have substantial development potential.
London-listed IP Group, which commercialises intellectual property in energy and healthcare, owns most of Istesso.
London-listed SPAC seeks Istesso merger
Last week, IP Group named GSK’s business strategy leader, Anita Kidgell, a non-executive director.
Hambro Perks, a London-based venture capital firm with holdings in dozens of early-stage startups including What3Words, the geolocation startup, and Tide, the business bank, conceived the SPAC.
Sir Anthony Salz, a former Rothschild banker, and City attorney, serves as its chairman.
Dominic Perks, co-founder of Hambro Perks, stated in November 2021, at the time of HPAC’s offering, that he had decided to list the vehicle in London due to rule changes that made the City more competitive with New York and Amsterdam.
The SPAC, which collected about £150 million through its first public offering, had 15 months to arrange a transaction. Meaning it has until next month to announce the merger or seek shareholder approval for an extension.
Hambro Perks has extensive healthcare investing experience, having funded start-ups such as Aide, a digital health service that helps patients manage chronic diseases, Genomics, a genetics-based pharmaceuticals company, and Akamis Bio, a clinical-stage oncology startup.
The SPAC boom in the United States prompted hundreds of enterprises. Including Sir Richard Branson’s Virgin Galactic and Virgin Orbit, to enter the public markets.
A succession of UK companies, notably Babylon Health and Cazoo, the online vehicle dealership, have merged with SPACs. Which has resulted in a precipitous decline in their market values.
Rothschild is advising Hambro Perks SPAC on the transaction, while Panmure Gordon is assisting Istesso.
Both HPAC and IP Group have been reached out to for comment.
