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Lancadia Vote, Katapult Deal, Virgin Galactic Share Offering: SPACs Attack Recap

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Lancadia Vote, Katapult Deal, Virgin Galactic Share Offering: SPACs Attack Recap

The "SPACs Attack" show airs weekdays on Benzinga’s YouTube channel at 11 a.m. ET. Here is a recap of Friday’s show.

Lancadia Vote: The top story was the SPAC merger vote for Lancadia Holdings II (NASDAQ: LCA) that took place Friday, however, not enough shareholders participated in the vote. The company has set Dec. 29 as the new vote date.

New SPAC Deal: On Friday, Finserv Acquisition Corp (NASDAQ: FSRV) announced a SPAC deal to bring Katapult public. Finserv Acquisition shareholders will own 25% of the new company. Shares will trade as "KPLT" if the merger is approved.

Katapult is an e-commerce focused point-of-sale platform that offers flexible lease purchase options for consumers. This is beneficial to consumers and offers upfront funding to the merchants.

The company works with over 150 merchants and 1.4 million customers. Partners and merchants include Wayfair (NASDAQ: W), Shopify (NASDAQ: SHOP) and Affirm.

Katapult is the only non-prime consumer POS lease financing platform that is focused on e-commerce. The company has less than 1% market share of the durable goods e-commerce market.

Katapult had revenue of $92 million in fiscal 2019. The company expects revenue of $250 million in fiscal 2020. Revenue is expected to grow at a compounded annual growth rate of 87% from 2020 to 2023 hitting $1.13 billion. Katapult expects net income of $27 million for fiscal 2020.

Watch the full show below:

Publicly traded Curo Group Holdings (NASDAQ: CURO) owns 40% of Katapult and shares are up higher on the connection to this deal. Curo said it will own 21% of the new company and will also receive $125 million in cash.

Virgin Galactic Offering: Former SPAC Virgin Galactic Holdings (NASDAQ: SPCE) has been in the news all week. Shares were down big Monday after a failed test flight last Saturday.

Virgin Galactic announced a new share offering and Chairman Chamath Palihapitiya announced on Twitter he sold 3.8 million shares this week to help fund other ventures.

Recent IPOs: Citron Research's report on DoorDash Inc (NASDAQ: DASH) calling the company the “most ridiculous IPO of 2020” was also discussed.

Upstart Holdings (NASDAQ: UPST) was discussed as a recent IPO that investors should look at. The company is using artificial intelligence to transform the broken lending system. The company has done over 620,000 loans and can help reduce loss rates and conversion rates.

Upstart was founded by Dave Girouard, who left Google in 2012. He was the president of enterprise at Google from 2004 to 2012. He helped build the $1 billion cloud apps business. Google is an investor in the company with around 1% ownership.

Revenue for the first nine months of 2020 was $146.7 million, up 44% year over year. Three of the last four quarters have been profitable for the company.

Upstart entered the auto lending market in June and processed its first loan in September, which could now put the company in competition with Ford Motor Company (NYSE: F), General Motors Company (NYSE: GM) and Ally Financial (NASDAQ: ALLY). The auto loan market is much larger than the traditional personal loan market Upstart began with.

Upstart is also considering using its platform and technology for credit cards, mortgages, student loans and point of sale loans in the future.

Shares priced at $20, the low end of their pricing range, and have traded up higher the past few days after their public debut.

 

Related Articles (LCA + SPCE)

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Posted-In: Chamath Palihapitiya Citron Research Share OfferingNews Short Sellers Small Cap Media Trading Ideas Best of Benzinga

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