Korean SPAC Valuence Merger debuts on Nasdaq, targets bio M&As

Valuence Merger Corp. 1, a special purpose acquisition company (SPAC), led by South Korean fund managers, has debuted on the Nasdaq, targeting Asian life science and sustainable technology firms seeking an initial public offering on the US stock market.

The SPAC, incorporated as a Cayman Islands exempted company, raised $200 million via its own IPO and started trading on the Nasdaq March 1 under the ticker symbol VMCAU. Valuence Capital LLC is the operator of the blank check company.

The IPO marks the first Nasdaq-listed SPAC organized by Korean private equity fund managers and bio specialists targeting Asian companies.

The blank check company filed for an application with the US Securities and Exchange Commission (SEC) on Jan. 19, with a plan to offer 20 million units at a price of $10. Each unit consists of one Class A ordinary share and one-half of a redeemable warrant of the company.

“Despite some bad news such as the Russian attack on Ukraine, institutional investors showed great interest in our company and participated in the IPO,” said a Valuence Capital official.

Valuence Capital is led by Chief Executive Woo Sung-yoon, founder and CEO of Korean private equity firm Credian Partners. He is joined by CFO and Director Andrew Hyung, a former Nomura Greentech investment banker; President Sung Lee, a former global venture capitalist; and COO Gene Cho, a former executive director of CG Pharmaceuticals.

Other directors include Cho Joong-myung, chairman and CEO of CrystalGenomics; Kim Young-min, ex-commissioner of the Korea Intellectual Property Office; and Gary Wunderlich, a co-founder and managing partner of Live Oak Merchant Partners. Nobuyuki Idei, former Sony chairman and founder of Japanese consulting firm Quantum Leaps, will serve as an advisor.

TO HELP ASIAN FIRMS SEEKING US IPOs

As a SPAC, Valuence Merger aims to identify and merge with a business in Asia, excluding China, Hong Kong and Macau in areas of life science or the environmental, social and governance (ESG)-related business.

According to global consulting firm McKinsey & Co., about 43% of 5,000 unicorn startups with a corporate value of over $1 billion were Asian companies as of May 2020. Of those Asian startups, only 300 firms, mostly Chinese, debuted on the US securities markets.

“Many Asian companies in the bio and environment-related businesses with breakthrough technology are undervalued in their respective countries. We’re going to help companies with great potential list on the Nasdaq,” said Valuence Capital CEO Woo.

Regulatory benefits, including the dual class system, will also help startup owners to protect their management rights and operate their companies stably, he said.

According to Valuence Capital, stock listings on the US markets via SPACs accounted for 63% of all US IPOs last year, and the ratio increased to 84% as of February this year, providing promising Asian companies with good opportunities for SPAC-led debuts.

Woo said Valuence Capital is considering Valuence Merger Corp. 2 and 3 to help Korean and other Asian companies suffering from the so-called “Korea Discount” or “Asia Discount” get their firms fairly valued via US listings.

Write to A-Young Yoon at youngmoney@hankyung.com
In-Soo Nam edited this article.