Anshuman Daaga

SINGAPORE, (Reuters) – Novo Tellus Capital Partners is a Southeast Asian technology investment fund. On Thursday, Novo Tellus listed the special purpose acquisition company (SPAC), marking its third IPO in Singapore this month. The city-state seeks out to be a center for SPAC listing.

This trio of SPAC listing in Singapore follows almost one year of a frenzy in which blank-cheque companies were launched in America. However, this was stopped when regulator changes and low returns adversely affected investor sentiment.

Novo Tellus Alpha Acquisition was able to raise S$150million (or 111 million). It traded at S$4.96, versus the initial public offering price (IPO) of S$5 per Unit. Each unit consists of one Class A share, and half of a warrant which can be exercisable for S$5.75 each share.

Shell firms or SPACs raise capital on the stock market to purchase private companies. This allows them to bring those businesses to the markets faster and with stronger valuations.

Loke Wai San, chief executive of Novo Tellus Alpha Acquisition said that structural changes in supply chain trends will benefit the region’s industrial and technological companies. He stated that Singapore is the best place for SPACs to be listed.

Loke told Reuters that he was looking for companies between S$500m and S$1billion.

Investors should “expect stable growth, profitability, not hypergrowth or huge losses,” he stated.

Vertex (NASDAQ) Technology Acquisition Corp Ltd was founded earlier this month by Temasek Holdings, a Singaporean state investor. It raised S$200 millions in the city.

The next to be added was a S$170 Million SPAC backed European asset manager Tikehau Capital as well as a holding company of LVMH CEO Bernard Arnault.

Hong Kong has also allowed SPAC listings since this year. However, retail investors are not permitted to participate.

Novo Tellus SPAC IPO was well-subscribed. Novo Tellus PE Fund 2 sponsored the IPO, which secured 13 key investors including Affin Hwang Asset Management Bhd in Malaysia and an indirect, 100%-owned subsidiary of Temasek.

Credit Suisse (SIX:), and DBS were joint issuer management and the joint global coordinator of the IPO.

($1 = 1.3491 Singapore dollars)