(Corrects to say pre-money value of $1.5 billion, not $1.6
billion, in paragraph 5. The story was previously corrected to
change attribution in paragraph 4)
Jan 18 (Reuters) - Special purpose acquisition company
Pioneer Merger Corp and investing app Acorns Grow have
mutually terminated their $2.2 billion merger agreement,
according to a regulatory filing on Tuesday.
The deal, announced in May last year, was originally
expected to close in the second half of 2021 and the Irvine,
California-based company was to be listed on the Nasdaq.
Acorns will pay Pioneer $17.5 million in termination fees in
monthly payments until December 15, as per the agreement.
"Given market conditions, we will be pivoting to a private
capital raise at a higher pre-money valuation," Chief Executive
Officer Noah Kerner told Reuters.
Kerner did not disclose what valuation Acorns was targeting.
A source familiar with the matter said the scrapped merger was
valued at $1.5 billion pre-money.
The source added the company was also considering a public
listing through a traditional initial public offering (IPO) at a
later date, but did not provide any specific timing.
Blank-check firms, or SPACs, are publicly-traded investment
vehicles that merge with a private company to take them public,
thereby sidestepping the hassles associated with a traditional
The trend of listing using SPACs has fizzled out recently
with the shares of several companies such as Grab Holdings
and BuzzFeed, which merged with SPACs,
tumbling after going public.
A regulatory squeeze in the broader blank-check market has
also led to some deals getting torpedoed, such as sports card
firm Topps and cannabis producer Parallel.
Backed by the likes of PayPal Holdings Inc,
BlackRock and Comcast Corp, Acorns allows
users to invest in stocks and bonds and uses a subscription
(Reporting by Niket Nishant, Sohini Podder and Manya Saini in
Bengaluru and David French in New York; Editing by Krishna