DT Cloud Star Acquisition Corporation Prices $60 Million Initial Public Offering
Rhea-AI Summary
DT Cloud Star Acquisition , a new blank check company in the Cayman Islands, announced the pricing of its initial public offering (IPO) at $60 million. The IPO consists of 6,000,000 units priced at $10.00 per unit. Each unit includes one ordinary share and one right to receive one-ninth of an ordinary share after an initial business combination. The units will trade on Nasdaq under the ticker DTSQU starting July 25, 2024. The expected IPO closing date is July 26, 2024. Following the IPO, the shares and rights will trade separately under the symbols DTSQ and DTSQR. A.G.P./Alliance Global Partners is managing the offering, with a 45-day option for underwriters to purchase an extra 900,000 units to cover over-allotments. Legal counsel includes Wilson Sonsini Goodrich & Rosati for the company and Sichenzia Ross Ference Carmel LLP for the underwriter.
Positive
- IPO raises $60 million.
- Units priced at $10.00 each.
- Trading begins on Nasdaq under ticker DTSQU on July 25, 2024.
- Underwriters have an option to purchase an additional 900,000 units.
Negative
- Shareholders receive only one-ninth of an ordinary share per unit upon business combination.
Insights
The pricing of DT Cloud Star Acquisition 's
The structure of the offering, with each unit comprising one ordinary share and a right to receive one-ninth of an additional share upon business combination, is designed to incentivize investors to hold their positions through the acquisition phase. This approach aims to mitigate the common SPAC challenge of shareholder redemptions prior to merger completion.
Notably, the company's decision to list on Nasdaq under the symbol "DTSQU" suggests a focus on technology or growth-oriented targets. The 45-day over-allotment option for up to 900,000 additional units provides flexibility to accommodate higher demand and potentially increase the acquisition war chest to
However, investors should approach with caution. The SPAC market has cooled significantly since its 2020-2021 boom, with many post-merger companies underperforming. The success of DT Cloud Star will heavily depend on the quality of the eventual acquisition target and the terms of the deal. As always with SPACs, retail investors should be aware that they are essentially betting on the expertise and connections of the management team to identify and execute a value-creating transaction.
The regulatory aspects of DT Cloud Star Acquisition 's IPO are important to understand. The company's incorporation in the Cayman Islands as a business company, rather than in a U.S. jurisdiction, may offer certain tax advantages but also introduces additional complexity for U.S. investors.
The SEC's declaration of effectiveness for the registration statement on July 24, 2024, indicates that the company has cleared a significant regulatory hurdle. However, the boilerplate language regarding the offer and sale of securities being made only by means of a prospectus is a critical legal point. This emphasizes the importance of potential investors thoroughly reviewing the full prospectus, which will contain detailed risk factors and other material information not included in this press release.
It's also worth noting the involvement of reputable law firms: Wilson Sonsini Goodrich & Rosati as U.S. counsel to the company and Sichenzia Ross Ference Carmel as U.S. counsel to the underwriter. Their participation lends credibility to the offering's legal structure and compliance.
Investors should be aware that SPACs operate under specific SEC rules, including the requirement to complete an acquisition within a typically 24-month timeframe. Failure to do so usually results in the SPAC's dissolution and return of funds to investors. This timeline creates both opportunities and pressures that can significantly impact investment outcomes.
New York, New York, July 24, 2024 (GLOBE NEWSWIRE) -- DT Cloud Star Acquisition Corporation, a newly organized blank check company incorporated in the Cayman Islands as a business company (the “Company”), today announced the pricing of its initial public offering (“IPO”) of 6,000,000 units at an offering price of
A.G.P./Alliance Global Partners is acting as the sole book-running manager for the offering.
The Company has granted the underwriters a 45-day option to purchase up to 900,000 units at the initial public offering price to cover over-allotments, if any. Wilson Sonsini Goodrich & Rosati, Professional Corporation served as the U.S. counsel to the Company and Sichenzia Ross Ference Carmel LLP served as U.S. counsel to the underwriter in this offering.
A registration statement relating to these securities was declared effective by the U.S. Securities and Exchange Commission (the “SEC”) on July 24, 2024. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. No securities regulatory authority has either approved or disapproved of the contents of this press release.
The offering is being made only by means of a prospectus, copies of which may be obtained from A.G.P./Alliance Global Partners, 590 Madison Avenue, 28th Floor, New York, NY 10022, or by telephone at (212) 624-2060, or by email at prospectus@allianceg.com or by visiting EDGAR on the SEC’s website at www.sec.gov.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About DT Cloud Star Acquisition Corporation
The Company is a blank check company, also commonly referred to as a special purpose acquisition company, or SPAC, formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses. While the Company may pursue an initial business combination target in any business or industry, it intends to focus its search on industries that complement its management team’s background. The Company is led by Mr. Bian Fan, the Company’s Chief Executive Officer, and Mr. Kenneth Lam, the Company’s Chief Financial Officer.
Forward-Looking Statements
This press release contains statements that constitute “forward-looking statements,” including with respect to the IPO and search for an initial business combination. No assurance can be given that the offering discussed above will be completed on the terms described, or at all, or that the net proceeds of the offering will be used as indicated. Forward-looking statements are subject to numerous conditions, many of which are beyond the control of the Company, including those set forth in the Risk Factors section of the Company’s registration statement and preliminary prospectus for the IPO filed with the SEC. Copies are available on the SEC’s website, www.sec.gov. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.
Contact:
For investors:
DT Cloud Star Acquisition Corporation
Bian Fan
Chief Executive Officer
Floors 1 through 3, 175 Pearl Street
Brooklyn, New York 11201
United States of America
Email: bian.fan@infinity-star.com
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