Slam Corp, the special purpose acquisition company led by former MLB player Alex Rodriguez, has extended its merger deadline with Lynk Global following significant investor withdrawals. According to recent filings, the company now has until March 25 to finalize the transaction, offering a crucial window for strategic adjustments.
Slam Corp initially secured $575 million through a Nasdaq listing in February 2021, intending to identify a suitable investment target. However, successive investor redemptions have reduced its trust account to a mere $23 million. As a SPAC, Slam Corp had a February 2023 deadline for merging with another entity, which was subsequently extended, causing further investor withdrawals.
In December 2023, a non-binding letter of intent was signed to merge with Lynk Global, a company that constructs its small satellites and delivers commercial services in regions like the Solomon Islands, Cook Islands, and Palau. Despite these initiatives, Lynk needed more time for the Securities and Exchange Commission’s regulatory processes, reportedly due to tighter SPAC merger regulations introduced in early 2024. These regulations align SPAC mergers with traditional IPO standards, thereby contributing to the delay.
In February, Lynk outlined a strategy to raise at least $110 million through the remaining cash in Slam’s trust and a private share sale. Yet, high SPAC redemption rates have hindered investments in various sectors, impacting Lynk’s plans as well. The company faces competition from industry leaders such as SpaceX and AST SpaceMobile as they enhance their direct-to-smartphone operations.
Lynk also planned a $40 million Series B funding round alongside the SPAC merger. The company requires additional capital to expand its satellite constellation, currently comprising five satellites developed in-house. These satellites facilitate low-bandwidth communication services, like texting, for unmodified phones through partnerships with local telecom providers in multiple countries.
Expanding the satellite network would allow Lynk to improve coverage and reduce latency, supporting subscribers beyond cellular range. Lynk aims to deploy 5,000 satellites, significantly enhancing global connectivity and service reliability.
The extended deadline offers Slam Corp and Lynk Global an opportunity to navigate regulatory challenges and strengthen their financial and strategic positions amidst heightened competition and market dynamics.
Source: Spacenews
