ACIC - Atlas Crest / Archer SPAC Deal Reset: High Redemptions Are Still Likely

• Atlas Crest / Archer SPAC deal was recut last week to reduce the pro forma enterprise value from $2.7B to $1.7B, a 38% valuation cut. Also, 15% of the promote.
• The sponsor letter agreement was amended to drop the one-year lockup. This allows sponsors to cash-out 85% of the promote shares immediately after deal-close.
• Despite the valuation cut, it is likely that minority investors will choose to redeem their shares, as there are substantial company and deal specific risks to investing in this zero-revenue company.

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