World View SPAC Merger Fails, No Longer Going Public

World View, the Stratospheric ballooning company known for its innovative approach to applications ranging from remote sensing to space tourism, has officially terminated its plans to go public through a special purpose acquisition company (SPAC) merger.

In a joint statement World View and Leo Holdings Corp II declared that the decision to abandon the merger was mutual, citing challenging market conditions as the primary reason.

The companies, while not providing specific details on the challenges faced, acknowledged the strong interest from potential investors that World View had garnered throughout 2023. Despite this interest, World View and Leo Holdings jointly determined that, given the current market conditions, proceeding with the previously announced transaction would not be in their best interest at this time.

The Deal

The merger, initially announced in January 2022, outlined a deal that would have provided up to $121 million for World View, valuing the company at $350 million.

Expectations were set for the deal to be concluded in the second quarter of the year. However, as subsequent months passed, there were limited updates on the status of the merger, raising concerns.

Facing an October deadline to finalize the deal or liquidate the company, Leo Holdings held a shareholder meeting on October 12. During this meeting, shareholders approved an extension of up to one year, with Leo Holdings explaining the need for additional time to complete the merger with World View.

The announcement of the World View deal coincided with a downturn in the popularity of SPACs, following a peak in 2021 when about a dozen space companies went public through SPAC mergers. Many of these companies have since experienced substantial declines in their share prices, with some facing financial challenges. Virgin Orbit, for instance, declared bankruptcy in April, and others, like Astra, are grappling with financial constraints.

With the termination of the World View merger, Leo Holdings has concluded that it will not be able to pursue a merger with another company. Consequently, the SPAC will liquidate, with proceeds returned to its shareholders.

The ending of this deal reflects the ongoing volatility and challenges within the space industry, particularly for companies seeking alternative routes to the public market.

About World View

World View, founded over a decade ago, has been a pioneer in the development of stratospheric balloons designed for applications traditionally associated with satellites, including remote sensing and communications. The company's ambitious plans also involved offering a spaceflight experience to individuals through balloon flights.

In a February investor presentation filed with the Securities and Exchange Commission (SEC), World View disclosed its performance metrics for 2022, which included four balloon flights and $3 million in revenue. The company projected a significant revenue increase to $17 million in 2023, albeit with an adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) loss of $11.6 million.