Tekkorp Digital Latest Gaming SPAC to Call it Quits
Posted on: October 6, 2022, 10:42h.
Last updated on: October 6, 2022, 11:29h.
Tekkorp Digital Acquisition (NASDAQ: TEKK) has scrapped plans to seek an extension to its business combination timeline. It becomes the latest gaming-focused special purpose acquisition company (SPAC) to fall victim to a blank-check thaw in the industry.
Earlier this week, the Las Vegas-based SPAC said it’s halting discussions with Playtech, Caliente Interactive, and Caliplay. That also ends what was the last of four bids for an Illinois mobile sports wagering license not tied to a land-based casino in the state, meaning all four of those efforts failed in some form.
The company will begin the process of winding down effective October 26, 2022, as set forth in its Amended and Restated Memorandum and Articles of Association, and as promptly as reasonably possible, but not more than ten business days thereafter, return capital to the company’s respective shareholders,” according to a Tekkorp statement.
SPACs generally have two years to execute business combinations, including mergers, and if that doesn’t happen, the firms can seek extensions or liquidate and return capital to investors. Tekkorp went public in late September 2020.
So Close for Tekkorp
Tekkorp was reportedly close to landing a deal, but that obviously didn’t come to fruition.
Last December, reports surfaced the SPAC was in talks with Caliente Interactive to bring that company public at a valuation of $2.5 billion. UK-based Playtech, a maker of gaming software, controls nearly half of Caliente through a joint venture. Caliente does most of its business in Mexico.
That transaction didn’t come to life, but Playtech, Caliente, and Tekkorp kept negotiations alive in hopes of arranging another deal and procuring an online sports betting permit in Illinois.
“Management focused on high-quality opportunities at fair valuations. As a result of persistently high valuation expectations combined with an increasingly volatile market and declining IPO market, the company was unable to secure an opportunity that it believes would offer a compelling return on investment for its shareholders,” according to the SPAC.
“In light of these circumstances, the Company has determined that it is not feasible to complete an initial business combination by October 26, 2022, and no longer believes that seeking an extension to such date would allow the Company to secure a compelling opportunity for its shareholders.”
SPAC Failures Piling Up
At the end of the third quarter, 22 SPACs liquidated year-to-date — more than double the tally in the previous five years.
Several of those liquidations occurred among blank-check firms that were looking for gaming industry targets, or those that had agreements that fall apart in the wagering space.
Earlier this week, a regulatory filing from Las Vegas Golden Knights owner Bill Foley confirmed he’s shuttering two SPACs, one of which was supposed to merge with Wynn Interactive.
Related News Articles
MGM Eventually Could Rebid for Entain
Wynn Surges on Speculation Tilman Fertitta Stake Could Lead to Takeover Bid
VICI Properties Selling Nearly 19M Shares, Could Use Cash for Acquisitions
Entain Woes Could Spur MGM to Consider Another Takeover Bid
Most Popular
Las Vegas Overstated F1 Race’s Vegas Impact — Report
Vegas Strip Clubs Wrestle in Court Over Animal Names
Most Commented
-
End of the Line for Las Vegas Monorail
April 5, 2024 — 90 Comments— -
Mega Millions Reportedly Mulling Substantial Ticket Price Increase
April 16, 2024 — 6 Comments— -
Nearly Abandoned Mall Outside Vegas Soon to Have Only One Tenant
March 12, 2024 — 5 Comments— -
Long Island Casino Opponents Love New York Licensing Delays
March 27, 2024 — 5 Comments—