SportsMap Tech Acquisition Corporation, a NASDAQ-listed special purpose acquisition company (SPAC), has announced that it has raised $115 million in its recently closed initial public offering (IPO). Owned by SportsMap Radio, the blank-check company announced the funds fetched by the IPO as it is making preparations to find a suitable merger partner/s. Most of the industry experts are of the view that the blank-check company could pursue a media deal sooner than later.
A SPAC or a blank-check company is essentially a business with very small capital in its hands. However, SPACs often attract big unlisted companies that want to go public or get listed on a stock exchange without going through the time-consuming process of IPO. After the merger, the unlisted company automatically becomes public. The normal route of IPO isn’t only time consuming but expensive also.
While SPACs encountered some headwinds in the past few months, the route remains popular in the gaming space. Gaming companies are increasingly trying to merger with SPACs to accelerate the pace of their expansion as well as unlock value for investors. Earlier this year, DraftKings completed the acquisition of Vegas Sports Information Network (VSiN) and agreed to a $50 million deal with Meadowlark Media.
IPO research firm Renaissance Capital said, “The firm (SportsMap) plans to leverage management’s experience and target opportunities in sports tech, with a focus on fan engagement, health and wellness, e-sports, and fantasy sports and gambling.”
SportsMap is progressing under the leadership of CEO David Gow, who also founded multi-platform media giant Gow Media. It includes ESPN Radio Houston and the SportsMap Radio Network in addition to some digital content websites.
Houston-based SportsMap recently declared that it would like to find a merger partner or partners in the gaming segments of the gaming industry, such as fantasy sports and wagering. However, SPACs are not bound by any obligation to merge with an entity in a particular sector/industry.
In addition to other businesses, SportsMap owns and operates the SportsMapBets website that provides betting education content, fantasy sports insight, simulations, and analysis.
Like any other black-check company, SportsMap Tech acquisition has a couple of years to execute a transaction or risk liquidation. If it opts for a media deal, it will likely attract a lot of enthusiasm from investors. According to Macquarie Research, deals between SPACs and media firms would value over $30 billion in iGaming and sports wagering revenue by 2030.