Viscogliosi Brothers Raise $75M in SPAC IPO
New York, New York-based Viscogliosi Brothers Acquisition Corp., a Special Purpose Acquisition Corporation or SPAC, also known as a “blank check company,” has raised $75 million in an initial public offering of 7,500,000 units at $10.00 per unit.
According to the company, “Each unit consists of one share of common stock and one half of one redeemable warrant, each whole warrant entitling the holder thereof to purchase one share of common stock at a price of $11.50 per whole share, subject to adjustment.”
Viscogliosi Brothers first announced its initial public offering on January 6, 2022. The units were then listed on the NASDAQ Global Market (NASDAQ) and were traded under the ticker symbol "VBOCU" beginning on January 7, 2022. The common stock and warrants will be listed under the symbols “VBOC” and “VBOCW” once the “securities comprising the units begin separate trading.”
Raymond James & Associates, Inc., based in St. Petersburg, Florida, was the exclusive bookrunning manager for the offering. The underwriters have a 45-day option to purchase “up to an additional 1,125,000 units from the Company [Viscogliosi Brothers] to cover over-allotments, if any.”
VBAC is led by Chairman, President, and CEO John Viscogliosi, a founding member and Principal of single-family office Viscogliosi Bros and the former CEO of Centinel Spine, and CFO Steve Ward, the CFO and COO of Viscogliosi and former CFO of Paradigm Spine.
Viscogliosi Brothers Acquisition plans to leverage the considerable and, frankly, legendary experience of Anthony, Marc and John Viscogliosi to invest in the neuro-musculoskeletal (NMS) industry, specifically focused on implantable devices, service, regenerative medicine, and contract manufacturing sectors.
The form of VBAC is a Special Purpose Acquisition Company (SPAC), which is to say that it begins as a public company with no commercial operations or even stated targets for acquisition although it does intend to acquire, merge or enter another allowed form of business combination with an existing company. Also known as "blank check companies," SPACs have been around for decades.
In recent years, SPACs have soared in popularity. In 2020, 247 SPACs were created with $80 billion invested, and in just the first quarter of 2021, a record $96 billion was raised from 295 newly formed SPACs. By comparison, only two SPACs came to market in 2010.
Like all SPACs, VBAC is required to complete an investment, acquisition or other allowable business combination generally within two years or else return their funds to investors.
The funds VBAC raised in its IPO will be placed in an interest-bearing trust account and cannot be disbursed except to complete an acquisition or other allowable business combination or to return the money to investors if the SPAC is liquidated.
The reason SPACs have soared in popularity is that they offer significant advantages for companies that have been planning to become publicly listed, for example:
- Faster – Companies can go public through VBAC in a matter of months, while the conventional IPO process is an arduous process that can take anywhere from six months to more than a year.
- More predictable – Risks such as market volatility or uncertainty triggered by external global events (a pandemic, for example) can easily derail a more conventional IPO but not necessarily a SPAC.
- Potentially better pricing – Companies that may be targeted by VBAC for acquisition may be able to negotiate a better price selling to VBAC than would be afforded by a protracted IPO process.
How have SPACs, in general, performed? According to a Goldman Sachs report dated September 2021, of the 172 SPACs that had closed a deal since the start of 2020, the median SPAC had outperformed the Russell 3000 index from its IPO to deal announcement; but in the six months after deal closure, the median SPAC had underperformed the Russell 3000 index by 42 percentage points. As many as 70% of SPACs that had their IPO in 2021 were trading below their $10 offer price as of Sept. 15, 2021, according to a Renaissance Capital strategist.
Certainly, one of the principal reasons VBAC was able to successfully raise funds, is because the Viscogliosi Brothers have a legendarily successful investment track record in the neuro-musculoskeletal industry. Over the past 20 plus years, the Viscogliosi Brothers have recorded many notable company exits and, in the process, achieved a remarkable $1.5 billion in exit value for investors. Those notable companies include Paradigm Spine, LLC; Small Bones Innovations (SBi); Knee Creations, LLC; Soteira; K2M Holdings, Inc.; Ascent Healthcare Solutions; Biorthex, Inc.; Cortek, Inc.; SpineNext; Spine Solutions; and Hospitec.
Founded in 1999 by Anthony, John and Marc Viscogliosi, Viscogliosi Brothers have provided venture capital, private equity, and merchant banking to companies and entrepreneurs in the neuro-musculoskeletal industry. More than 20 companies have benefited from 200 VB led transactions, and 9 VB organized partnerships.
Viscogliosi Brothers current portfolio of investments include: Centinel Spine, LLC; Woven Orthopedic Technologies, LLC.; FX Solutions; MCRA; and Viscogliosi & Company, LLC.