eCommerce FinTech Katapult To Go Public By Merging With SPAC

Katapult Holding, Inc. and special purpose acquisition company (SPAC) FinServ Acquisition Corp. said on Friday (Dec. 18) that they have entered into a definitive merger deal. The arrangement will create a combined firm that will run as Katapult and is intended to trade on the Nasdaq with the “KPLT” ticker symbol upon closing, according to an announcement.

The deal, which shows a roughly $1 billion implied pro forma combined enterprise value for the company, is anticipated to close in the first half of next year.

However, the deal is still subject to several conditions such as the approval of FinServ investors representing a majority of the current FinServ voting power, the effectiveness of a registration statement to be filed with the U.S. Securities and Exchange Commission, the conclusion of the HSR Act waiting period, and “other customary closing conditions,” per the announcement.

“Today’s announcement marks the beginning of an exciting new chapter in our history, and we are delighted to be entering into this transaction with FinServ to become a publicly traded company. Since our inception, Katapult’s goal has always been to provide a clear, transparent and attractive transaction solution for nonprime consumers to access the essential products they need for everyday living,” Katapult CEO Orlando Zayas said in the announcement.

Katapult offers eCommerce point of sale (POS) choices for U.S. nonprime shoppers. The company’s digital technology infrastructure offers a flexible lease purchase option to consumers to let them receive key durable goods from its network of eCommerce merchants.

In terms of the mechanics, special purpose acquisition companies (SPACs) function as shell companies that bring in funds from investors and then go looking to buy and take a private company public. Since investors buy into them before a deal has occurred, these types of firms are many times known as “blank-check companies.”

The news comes as BarkBox, the New York subscription upstart, is merging with blank-check company Northern Star Acquisitions Corp. in a $1.6 billion arrangement, according to a published report that cited unnamed sources.