Fusion Acquisition Corp. II Announces Redemption of Shares
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Insights
The decision by Fusion Acquisition Corp. II to redeem all outstanding shares of Class A common stock due to the inability to secure an initial business combination within the specified timeframe is a significant financial event. The redemption price of approximately $10.67 per share, slightly above the typical $10.00 per unit IPO price for SPACs, indicates a return of funds with some accrued interest, less taxes and dissolution expenses. This event is consequential for shareholders as it marks the dissolution of the company and the return of their investment.
Investors who hold these shares will need to pay close attention to the process for redeeming their shares, as the procedure differs for record holders and beneficial owners. The lack of redemption rights or liquidating distributions for warrant holders could suggest a total loss on their investment, as warrants typically become worthless if a SPAC fails to complete a business combination.
The filing of a Form 15 with the SEC indicates the company's intent to deregister its securities and terminate its public reporting obligations, effectively removing itself from public markets. This step is a standard procedure following the liquidation of a SPAC that has not achieved its business combination goal.
From a legal perspective, the actions taken by Fusion Acquisition Corp. II adhere to the provisions set forth in their amended and restated certificate of incorporation. The decision to redeem the shares and liquidate the trust account is a contractual obligation that the company must fulfill in the event of not completing a business combination within the allotted time.
The waiver of redemption rights by the initial shareholders, typically the SPAC sponsors, is a noteworthy point. This action often signifies that the sponsors are relinquishing potential returns to prioritize the public shareholders' interests. However, this also means that the sponsors are likely to incur a loss on their initial investment.
Terminating the registration of securities with the SEC is a formal process that involves ceasing the company's reporting obligations. This step is indicative of the final winding down of the company's operations and exit from the public market.
The redemption of shares by Fusion Acquisition Corp. II is reflective of a broader trend within the Special Purpose Acquisition Company (SPAC) industry, where many SPACs have faced challenges in finding suitable merger targets within the designated timeframe. This event can impact the industry by influencing investor sentiment toward SPACs, potentially leading to increased scrutiny and hesitance to invest in future SPAC offerings.
It is important to note that the SPAC market has cooled significantly after a peak in activity and the dissolution of a SPAC without a business combination is not an isolated incident. This could lead to a reevaluation of the SPAC structure and the associated risks, possibly prompting regulatory changes or shifts in investor strategy.
The industry-specific term 'initial business combination' refers to the merger or acquisition that a SPAC aims to complete using the funds raised during its IPO. Failure to achieve this goal within the specified timeframe triggers redemption processes as seen with Fusion Acquisition Corp. II.
NEW YORK, Dec. 22, 2023 (GLOBE NEWSWIRE) -- Fusion Acquisition Corp. II today announced that its board of directors (the “Board”) has determined to redeem all of its outstanding shares of Class A common stock (the “Public Shares”), effective as of December 28, 2023, because the Company will not consummate an initial business combination within the time period required by its amended and restated certificate of incorporation.
As of the close of business on December 28, 2023, the Public Shares will be deemed cancelled and will represent only the rights to receive the per-share redemption price of approximately
In order to provide for the disbursement of funds from the trust account, the Company will instruct the trustee of the trust account to take all necessary actions to liquidate the trust account. The proceeds of the trust account will be held in a non-interest bearing account while awaiting disbursement to the holders of the Public Shares. Record holders may redeem their shares for their pro rata portion of the proceeds of the trust account upon presentation of their respective shares or unit certificates or other delivery of their shares or units to Continental Stock Transfer & Trust Company, the Company’s transfer agent. Beneficial owners of Public Shares held in “street name,” however, will not need to take any action in order to receive the redemption amount. The redemption of the Public Shares is expected to be completed by December 28, 2023.
There will be no redemption rights or liquidating distributions with respect to the Company’s warrants. The Company’s initial shareholders have waived their redemption rights with respect to the outstanding shares of Class B common stock issued prior to the Company’s initial public offering.
The Company expects to file a Form 15 with the U.S. Securities and Exchange Commission (the “SEC”) to terminate the registration of its securities under the Securities Exchange Act of 1934, as amended.
Forward Looking-Statements
This press release may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact included in this press release are forward-looking statements, including, without limitation, the redemption of the Public Shares and the per-share redemption price. When used in this press release, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend” and similar expressions, as they relate to us or our management team, identify forward-looking statements. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to, the Company’s management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors detailed in the Company’s filings with the SEC. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by this paragraph. 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 latest Annual Report on Form 10-K filed with the SEC. 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 | |
| John James Chief Executive Officer 212-763-0169 | |
| SOURCE: Fusion Acquisition Corp. II |
FAQ
What is the reason behind Fusion Acquisition Corp. II's decision to redeem all outstanding shares of Class A common stock?
What is the redemption price per share for Fusion Acquisition Corp. II's outstanding shares of Class A common stock?
When is the redemption of Fusion Acquisition Corp. II's outstanding shares of Class A common stock expected to be completed?
What action do record holders need to take to redeem their shares of Class A common stock in Fusion Acquisition Corp. II?
What will happen to the Company's warrants in relation to the redemption of the outstanding shares of Class A common stock?
