US banking billionaire Moelis founds new SPAC with sights set on gambling sector

Investment banking billionaire Ken Moelis has founded a new special purpose acquisition company and will aim to conduct business in the US gambling sector.

Investment banking billionaire Ken Moelis has founded Atlas Crest Investment II, a new special purpose acquisition company (SPAC) that will aim to work across a range of sectors including sports wagering.

A new SPAC

The SPAC filed a prospectus which revealed that the company plans to raise $250m in an initial public offering (IPO) with 25m units which will consist of a share and one-third of an exercisable warrant valued at $10 per unit.

Atlas will then work to acquire a business in high growth sectors which includes “media, online gaming/sports betting, fintech/payments, healthcare, business services and disruptive consumer, food and beverage.”

The acquired business will then be able to trade on the New York Stock Exchange. Currently, Atlas does not have a business in mind and is not engaged in substantial discussions about a deal. 

However, Atlas said the business should meet five criteria; the business should be sourced through Atlas Crest’s channels, have “a committed and capable management team”, generate a “stable and growing free cash flow,” would benefit from the acquisition and has the potential to grow, either through further acquisitions or technological advances.

The Atlas SEC filing said: “We believe that the experience and capabilities of our management team will make us an attractive partner to potential target businesses, enhance our ability to complete a successful initial business combination and enhance the value of the business post-business combination.

“Additionally, we believe the proprietary sourcing channels and extensive relationship network of our management team and from our affiliation with Moelis, combined with our operating, investing, capital markets and transaction experience, provide us with a competitive advantage.”

Moelis will serve as the SPAC’s chairman while Michael Spellacy, Accenture’s senior managing director for capital markets, will be its chief executive and also serve as a director.

Prior to this, Moelis’ investment business, Moelis & Company, brought in revenue of almost $750m in 2019 and helped to facilitate Bally’s integration deal with Sinclair Broadcast Group.

SPAC’s in the US gambling space

In recent year’s, SPAC’s have played a pivotal role in helping US gambling companies go public.

In 2019, Diamond Eagle Acquisition Corp agreed a deal to acquire and combine both DraftKings and SBTech and the combined business went public in April 2020.

Golden Nugget Online Gaming, the online arm of Golden Nugget, went public in December 2020 after inking a deal with Landcadia Holdings II. Rush Street Interactive went public on the New York Stock Exchange in December after the SPAC dMY Technology Group completed its combination with the operator.

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