Ginkgo will start buying and selling on the NYSE after the SPAC merger completes
Boston-based Ginkgo Bioworks began trading on the New York Stock Exchange Friday and is the latest company to complete a SPAC merger and go public. Its shares opened at $ 11.15 apiece under the ticker symbol “DNA,” giving the five-time CNBC Disruptor 50 company a market cap of nearly $ 2.5 billion.
Ginkgo was founded in 2009 by a team of MIT scientists with the goal of creating bespoke microbes that enable customers to grow rather than make better products. The company is called “Organism Company” because it designs and prints DNA, the building blocks that support all living things.
The biotech company merged with Soaring Eagle Acquisition Corp., the blank check company led by former MGM CEO Harry Sloan. Soaring Eagle Acquisition Corp., Sloan’s seventh SPAC formation, is led by executives from the same blank check company that launched DraftKings and Skillz last year.
A SPAC is a blank check company that raises money to buy a private company through a reverse merger and take it public with the help of funding additional investors. SPAC deals have become increasingly popular for going public over the past year, but the pace of deals has slowed in recent months as yields continue to decline.
The transaction included a $ 775 million private placement conducted by Baillie Gifford, Putnam Investments and the Counterpoint Global arm of Morgan Stanley Investment Management. So-called PIPE funding is a mechanism for companies to raise capital from a select group of investors that enables the final market debut. Cathie Woods Ark Investment Management, Bain Capital’s public equity arm, Cascade Investment from Bill Gates’ private investment arm, and T. Rowe Price Associates will also be attending.
The proprietary CNBC SPAC 50 index, which tracks the 50 largest U.S. pre-merger blank check deals by market capitalization, rose sharply earlier in the year but suffered a sharp decline and is now negative for the year. The CNBC SPAC Post Deal Index, which is made up of the largest SPACs to hit the market and have announced a targeted takeover, has wiped out its year-to-date gains. Still, the CNBC SPAC Post Deal Index rose slightly in the past week through Monday.
SPACs are being hit by an increasing number of class action lawsuits, with 15 shareholder lawsuits by the first half of 2021 triple from just five in all of 2020, according to data from Woodruff Sawyer.
“SPACs have been marketed as a way to go public faster and easier compared to a traditional IPO, but this could attract companies that may not be ready for a public exam. That is certainly what the plaintiffs are trying to prove. ”Priya Huskins, a partner at Woodruff Sawyer, recently told CNBC.
Ginkgo Bioworks is a five-time CNBC Disruptor 50 company. Sign up for our weekly original newsletter that goes beyond the annual Disruptor 50 list and offers a closer look at start-up trends and founders who continue to innovate in all areas of the economy.