ADQ-backed SPAC to merge with United Printing & Publishing

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UAE’s first special purpose acquisition company (SPAC) – ADC Acquisition Corporation (ADC) – has agreed to a Dhs1.1bn merger with Abu Dhabi’s United Printing & Publishing (UPP), a company that prints identification cards.

Abu Dhabi wealth fund ADQ will be issued 62.3 million new Class A shares in ADC for an issue price of Dhs10.00 per share as consideration for the contribution of UPP to the SPAC or blank check firm.

Similarly, ADC intends to pursue a private investment in public equity (PIPE) fundraising of up to Dhs734m to drive organic and inorganic growth avenues for UPP. ADC will issue up to 73.4 million new Class A shares for Dhs10.00 per share in respect of the PIPE fundraising.

The deal implies an equity value of Dhs623m for the Abu Dhabi-based printing, commercial printing and last-mile delivery business.

“As the region’s first SPAC merger process, this transaction marks a notable achievement for ADC and reaffirms Abu Dhabi Securities Exchange (ADX) as the region’s most dynamic financial market,” said Seif Fikry, CEO OF ADC.

“We are confident that UPP represents an attractive platform, with strong and stable revenue, through its long-term contracts and relationships with anchor customers, such as UAE government entities.”

ADQ will remain the single largest shareholder in the combined company, post-merger. Abu Dhabi-based UPP plans to grow its presence internationally and domestically through organic and inorganic paths.

“In the secure printing sector, UPP leverages next-generation data security technologies for its best-in-class product offering and currently holds a prominent position as a leader in ID security printing within the region,” ADC said in a bourse filing.

The merger is expected to accelerate the company’s growth strategy and capture a large market share by leveraging its brand, customer base, and the strength of its ecosystem.

Upon completion of the transaction, UPP will become a publicly listed company on the ADX, a significant milestone which will mark the region’s first successful SPAC merger process.

MENA region’s first SPAC

ADC, which is backed by ADQ and Chimera Investments, became the first SPAC to list in the Middle East in April 2022.

The blank check firm was created to identify and merge with one or more businesses. It intends to invest in scalable fast-growing, technology-driven firms in the Middle East and North Africa region with strong management teams and attractive valuations.

The UAE SPAC regulatory framework is modelled on the US and international SPAC regulations.  It stipulates that upon listing, blank-check firms must ensure that 90 per cent of proceeds are placed in a non-interest-bearing account to protect the interest of the investors.

ADX was the first market in the MENA region to introduce comprehensive listing rules under the newly formed regulatory framework for SPACs issued by the UAE’s Securities and Commodities Authority. The initiative has further cemented Abu Dhabi’s position as a leading financial centre for regional and global investors.

Read: ADQ and Chimera Investments to launch UAE’s first SPAC on ADX