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Investcorp AI Acquisition Corp(IVCAU) - 2024 Q4 - Annual Report
IVCAUInvestcorp AI Acquisition Corp(IVCAU)2025-04-16 20:15

IPO and Initial Business Combination - The Company completed its Initial Public Offering (IPO) on May 12, 2022, raising gross proceeds of 225millionfromthesaleof22,500,000unitsat225 million from the sale of 22,500,000 units at 10.00 per unit[21]. - Following the IPO, the underwriter exercised their over-allotment option, resulting in an additional issuance of 3,375,000 units for 33.75million[21].−Atthe2023ExtraordinaryGeneralMeeting,shareholdersapprovedaproposaltoextendthedeadlineforcompletingtheInitialBusinessCombinationtoAugust12,2024,with16,085,554ClassAordinarysharesredeemedforapproximately33.75 million[21]. - At the 2023 Extraordinary General Meeting, shareholders approved a proposal to extend the deadline for completing the Initial Business Combination to August 12, 2024, with 16,085,554 Class A ordinary shares redeemed for approximately 172.77 million[23]. - The 2024 Extraordinary General Meeting approved an extension to May 12, 2025, with 8,314,066 Class A ordinary shares redeemed for approximately 95.45million[24].−TheCompanyiscurrentlyseekinganalternativebusinesscombinationafterBigtincanHoldingsLimitedterminatedtheschemeimplementationdeedonDecember5,2024[27].−TheCompanyintendstofocusonhigh−qualitybusinessesinsectorssuchasartificialintelligence,healthcare,andfintech,particularlyinIndia[28].−Themanagementteamaimstoleveragetheirextensivenetworkandindustryexpertisetoidentifyandevaluatepotentialacquisitiontargets[29].−TheCompanyplanstotargetbusinesseswithanenterprisevalueexceeding95.45 million[24]. - The Company is currently seeking an alternative business combination after Bigtincan Holdings Limited terminated the scheme implementation deed on December 5, 2024[27]. - The Company intends to focus on high-quality businesses in sectors such as artificial intelligence, healthcare, and fintech, particularly in India[28]. - The management team aims to leverage their extensive network and industry expertise to identify and evaluate potential acquisition targets[29]. - The Company plans to target businesses with an enterprise value exceeding 1 billion, emphasizing appropriate valuations and growth potential[35]. - The Sponsor has committed to contribute up to 1.2milliontotheTrustAccounttofacilitatetheextensionoftheInitialBusinessCombinationdeadline[23].−ThecompanymayextendtheperiodtoconsummateanInitialBusinessCombinationbyanadditionalthreemonthsontwoseparateoccasionswithoutprovidingshareholderswithvotingrights[60].−ThecompanymaynotbeabletocompleteitsInitialBusinessCombinationwithintheprescribedtimeframe,whichcouldleadtoliquidationandapotentialreturnof1.2 million to the Trust Account to facilitate the extension of the Initial Business Combination deadline[23]. - The company may extend the period to consummate an Initial Business Combination by an additional three months on two separate occasions without providing shareholders with voting rights[60]. - The company may not be able to complete its Initial Business Combination within the prescribed time frame, which could lead to liquidation and a potential return of 11.87 per share to Public Shareholders[60]. - The company may complete its Initial Business Combination without a majority of Public Shareholders' support, as it can seek shareholder approval or allow redemptions through a tender offer[64]. - If the Initial Business Combination is not completed within the required time, Public Shareholders may receive approximately 11.87pershareuponliquidationoftheTrustAccount[62].−Thecompanyhasnooperatinghistoryorrevenues,makingitdifficultforinvestorstoevaluateitsabilitytoachievebusinessobjectives[62].−ThecompanymayfacechallengesincompletingitsInitialBusinessCombinationduetolimitedresourcesandsignificantcompetitionforopportunities[62].−IftoomanyPublicShareholdersexercisetheirredemptionrights,thecompanymaynotmeetclosingconditionsforatargetbusiness,potentiallyjeopardizingtheInitialBusinessCombination[68].−Thecompany’sabilitytoredeemPublicSharesmaybelimitedifitwouldcausethesharestobeconsidered"pennystock"undertheExchangeAct[69].−ThecompanyhasuntilMay12,2025,toconsummateanInitialBusinessCombination,withthepotentialforextensionsthroughadditionalcontributionsfromtheSponsor[85].−TheSponsorhasagreedtocontributeupto11.87 per share upon liquidation of the Trust Account[62]. - The company has no operating history or revenues, making it difficult for investors to evaluate its ability to achieve business objectives[62]. - The company may face challenges in completing its Initial Business Combination due to limited resources and significant competition for opportunities[62]. - If too many Public Shareholders exercise their redemption rights, the company may not meet closing conditions for a target business, potentially jeopardizing the Initial Business Combination[68]. - The company’s ability to redeem Public Shares may be limited if it would cause the shares to be considered "penny stock" under the Exchange Act[69]. - The company has until May 12, 2025, to consummate an Initial Business Combination, with the potential for extensions through additional contributions from the Sponsor[85]. - The Sponsor has agreed to contribute up to 1,650,000 to the Trust Account, with monthly contributions of 50,000untilthecompletionoftheInitialBusinessCombinationorMay12,2025[93].−PublicShareholdersmayreceiveonly50,000 until the completion of the Initial Business Combination or May 12, 2025[93]. - Public Shareholders may receive only 11.87 per share upon redemption if the Initial Business Combination is not completed, which is higher than the typical 10.00pershareseeninsimilarcompanies[95].−ThecompanymayfacechallengesincompletingtheInitialBusinessCombinationduetogeopoliticaltensions,whichcouldadverselyaffecttargetbusinessesandmarketconditions[81].−Thecompanymaynotbeabletofindasuitabletargetbusinesswithintheprescribedtimeframe,whichcouldleadtoceasingoperationsandliquidating[89].−TherequirementtocompletetheInitialBusinessCombinationwithinaspecifictimeframemaygivepotentialtargetbusinessesleverageinnegotiations[88].−IfthecompanydoesnotcompletetheInitialBusinessCombination,thewarrantswillexpireworthless,impactingPublicShareholdersnegatively[89].−ThecompanymaynotbeabletoengagefinancialadvisorsfortheInitialBusinessCombination,whichcouldmateriallyimpactitsabilitytocompletethetransaction[91].−TheTrustAccountcurrentlycontains10.00 per share seen in similar companies[95]. - The company may face challenges in completing the Initial Business Combination due to geopolitical tensions, which could adversely affect target businesses and market conditions[81]. - The company may not be able to find a suitable target business within the prescribed time frame, which could lead to ceasing operations and liquidating[89]. - The requirement to complete the Initial Business Combination within a specific time frame may give potential target businesses leverage in negotiations[88]. - If the company does not complete the Initial Business Combination, the warrants will expire worthless, impacting Public Shareholders negatively[89]. - The company may not be able to engage financial advisors for the Initial Business Combination, which could materially impact its ability to complete the transaction[91]. - The Trust Account currently contains 11.87 per Class A ordinary share, incentivizing Public Shareholders to redeem their shares[95]. - The company may face conflicts of interest if the Sponsor provides loans for extensions, as these loans would not be repaid if the Initial Business Combination is not completed[93]. - The company expects to encounter intense competition from other entities with similar business objectives, which may increase the cost of the Initial Business Combination and limit the ability to find attractive targets[101]. - The company may not be able to complete its Initial Business Combination if it cannot raise additional financing necessary to fund expenses[106]. - The company must complete the Initial Business Combination with target businesses having an aggregate fair market value of at least 80% of the assets held in the Trust Account at the time of signing a definitive agreement[156]. - The company has no specified maximum redemption threshold, allowing for the possibility of completing an Initial Business Combination even if a majority of shareholders disagree[157]. - The company may incur substantial debt to complete the Initial Business Combination, which could adversely affect leverage and financial condition[147]. - The absence of a redemption threshold may lead to a situation where a significant number of shareholders redeem their shares, impacting the completion of the Initial Business Combination[158]. - The company may seek to amend its governing instruments to facilitate the Initial Business Combination, which may not align with shareholder interests[159]. - The company may face risks associated with acquiring private companies with limited public information, potentially leading to less profitable business combinations than anticipated[155]. - The company may face challenges in obtaining additional financing for its Initial Business Combination, which could lead to restructuring or abandonment of the transaction[163]. Financial Condition and Reporting - The company has a monthly fee of 10,000forofficespace,utilities,andadministrativeservices[47].−Thecompanyisclassifiedasan"emerginggrowthcompany"andcandelaytheadoptionofcertainaccountingstandardsuntiltheyapplytoprivatecompanies[55].−Thecompanywillremainanemerginggrowthcompanyuntilithastotalannualgrossrevenuesof10,000 for office space, utilities, and administrative services[47]. - The company is classified as an "emerging growth company" and can delay the adoption of certain accounting standards until they apply to private companies[55]. - The company will remain an emerging growth company until it has total annual gross revenues of 1.235 billion or more[56]. - The company has no current intention of suspending its reporting obligations under the Exchange Act prior to the consummation of its Initial Business Combination[53]. - The company currently has two officers and does not intend to hire full-time employees before completing its Initial Business Combination[49]. - The company has net tangible assets in excess of 5,000,000uponcompletionoftheInitialPublicOffering,exemptingitfromcertainSECrulesforblankcheckcompanies[100].−ThecompanymaydependonloansfromitsSponsorormanagementteamtofundoperationsiffundsoutsidetheTrustAccountareinsufficient[109].−Approximately5,000,000 upon completion of the Initial Public Offering, exempting it from certain SEC rules for blank check companies[100]. - The company may depend on loans from its Sponsor or management team to fund operations if funds outside the Trust Account are insufficient[109]. - Approximately 2,150,000 will be available outside the Trust Account to fund working capital requirements, with offering expenses estimated at 1,000,000[109].−Thecompanymayincursubstantialcostsininvestigatingtargetbusinesses,whichwouldnotberecoverableifaspecificInitialBusinessCombinationisnotcompleted[140].−Thecompanymayonlycompleteonebusinesscombinationwiththeproceeds,leadingtodependencyonasinglebusinesswithlimitedproductsorservices,potentiallyimpactingoperationsandprofitability[149].−Thecompanymayfacechallengesinmaintainingorobtainingthequotation,listing,ortradingofitssecuritiesonanationalsecuritiesexchangeduetopotentialreductionsinthepublicfloat[97].−ThecompanyreceivedanotificationfromNasdaqindicatingthatitsmarketvalueoflistedsecurities(MVLS)fellbelowtherequired1,000,000[109]. - The company may incur substantial costs in investigating target businesses, which would not be recoverable if a specific Initial Business Combination is not completed[140]. - The company may only complete one business combination with the proceeds, leading to dependency on a single business with limited products or services, potentially impacting operations and profitability[149]. - The company may face challenges in maintaining or obtaining the quotation, listing, or trading of its securities on a national securities exchange due to potential reductions in the public float[97]. - The company received a notification from Nasdaq indicating that its market value of listed securities (MVLS) fell below the required 50 million for continued listing[207]. - The company has a compliance period of 180 days, until May 28, 2025, to regain compliance with the MVLS requirement[207]. - If the company's MVLS closes at $50 million or more for ten consecutive business days, Nasdaq will confirm compliance[207]. - The company intends to actively monitor its MVLS and take measures to regain compliance within the specified period[208]. - The potential delisting could result in the company's Class A ordinary shares being classified as "penny stock," imposing stricter trading rules[210]. - A material weakness in internal control over financial reporting was identified, which may affect the accuracy of financial statements[169]. Risks and Challenges - The company may face intense competition from other entities with similar business objectives, which may limit its ability to acquire larger target businesses[46]. - The company is not prohibited from pursuing Initial Business Combinations with affiliated targets, but will seek independent opinions to ensure fairness[44]. - The company anticipates that its management team will leverage their extensive networks to identify potential Initial Business Combination targets[43]. - CFIUS regulations may impose conditions or prevent the consummation of the Initial Business Combination, affecting its attractiveness to investors[75]. - The company risks CFIUS intervention in its Initial Business Combination due to foreign ownership ties, which could impact transaction certainty and feasibility[77]. - If CFIUS reviews the Initial Business Combination, it could delay completion beyond the Extended Date of May 12, 2025[79]. - The company may face challenges in completing its Initial Business Combination due to geopolitical tensions, which could adversely affect target businesses and market conditions[81]. - Key personnel's departure could adversely affect the ability to operate and the success of the Initial Business Combination[189]. - Conflicts of interest may arise as officers and directors are not required to commit full time to the company's affairs, potentially impacting the Initial Business Combination process[195]. - The company has not adopted a policy to prohibit directors and officers from having financial interests in transactions, which may lead to conflicts of interest[199]. - Indemnification claims for directors and officers may not be satisfied if sufficient funds are not available outside the Trust Account[201]. - Certain agreements related to the Initial Public Offering can be amended without shareholder approval, which may affect the value of investments[202]. - Amendments to agreements may facilitate the Initial Business Combination but could have adverse effects on the investment value[203]. - The company may face liabilities under the Foreign Corrupt Practices Act (FCPA), which could negatively impact business operations and financial condition[187]. - The company may face challenges in obtaining additional financing for its Initial Business Combination, which could lead to restructuring or abandonment of the transaction[163]. - The company may face risks associated with acquiring private companies with limited public information, potentially leading to less profitable business combinations than anticipated[155]. - The management team plans to pursue a company with operations outside the United States for the Initial Business Combination, which may introduce additional risks[182]. - Potential risks include costs and difficulties in managing cross-border operations, compliance with overseas regulations, and currency redemption rules[183]. - Exchange rate fluctuations could adversely affect the dollar equivalent of net assets and distributions if a non-U.S. target is acquired[186]. - The company may face challenges in completing the Initial Business Combination due to limited resources and significant competition for opportunities[62].