One of the most famous voices in the SPAC industry is launching four new SPACs and also making several changes to his existing lineup of SPACs and former SPACs.
What Happened: Chamath Palihapitiya is launching four new SPACs targeting the biotechnology sector. Each SPAC is seeking to raise $200 million and will not contain warrants.
The SPACs are Social Capital Suvretta Holdings Corp I NASDAQDNAA, Social Capital Suvretta Holdings Corp II NASDAQDNAB, Social Capital Suvretta Holdings Corp III NASDAQDNAC and Social Capital Suvretta Holdings Corp IV NASDAQDNAD.
The SPACs break away from the traditionally named Social Capital Hedosophia line of SPACs from Palihapitiya’s Social Capital and Hedosophia. That line of SPACs also featured similarly-sequenced tickers, IPOA to IPOF.
Palihapitiya filed names for seven additional SPACs in the IPO line in February and had previously announced plans to launch SPACs IPOA to IPOZ.
The New SPACs: The four new SPACs are a partnership between Social Capital and Kishan Mehta, the portfolio manager of the Averill strategy at Suvretta. The new company will use “scientists, physicians, entrepreneurs and biotechnology-oriented investors around a shared vision of identifying and investing in innovative and agile biotechnology companies.”
Suvretta was founded in 2011 and has $4.5 billion in assets under management. The investment firm uses industry insights and fundamental-based stock selection according to the prospectus.
The Averill strategy is a “healthcare-oriented investment strategy that focuses on identifying companies that are disruptive to the healthcare industry.”
Palihapitiya will serve as the CEO and Chairman of all four SPACs, with Mehta serving as the President or Director of each SPAC.
Target Market: The SPACs are targeting the biotechnology sector, specifically companies that can improve quality of life. The filings cite new drugs that can treat Hepatitis C in weeks and new immunotherapies that are targeting fatal forms of cancer.
“Agile private biotechnology companies are uniquely positioned to embrace advances in drug development and rapidly innovate to develop life-changing therapies for patients.”
The filings highlight research and treatment options for the central nervous system and peripheral nervous system.
“Our management team will seek to capitalize on advances in nervous system therapeutic development by pursuing compelling investment opportunities in this space.”
Target areas could include CNS, neurodegenerative diseases, psychiatric diseases and addiction. The SPACs will target companies that have “multiple opportunities for success.”
Chamath’s SPACs: Palihapitiya has completed SPAC mergers for Virgin Galactic Holdings SPCE 7.75%, Opendoor Technologies OPEN 7.35%, Clover Health Investments CLOV 13.07% and SoFi Technologies Inc SOFI 2.47%.
Palihapitiya’s Social Capital Hedosophia Holdings Corp IV IPOD 0.1% and Social Capital Hedosophia Holdings Corp VI IPOF 0.39% are both searching for targets with IPOF rumored to be bringing Equinox public.
Disclosure: Author has a long position in SPCE, IPOD and IPOF.
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