Latest News by Industry
• The digital media company’s stock fell to $8.33 after rising as high as $14.77
• The company had gone public via a SPAC merger with 890 Fifth Avenue Partners Inc
Buzzfeed's trading debut on the Nasdaq hit a bummer after the stock fell by nearly 9.8% to trade at $8.33. Earlier during the day, its shares rose as high as $14.77 apiece.
In June, the digital media company had announced its plans to go public by merging with a special-purpose acquisition company (SPAC), 890 Fifth Avenue Partners Inc.
BuzzFeed expected to raise $16 million from its offering after 94% of the $287.5 million raised by the SPAC was pulled by investors, according to an updated SEC filing first reported by the Wall Street Journal.
It also raised an additional $150 million in convertible note financing as part of the SPAC deal.
SPACs are formed to raise capital through a public listing and merge with a private company, which intends to go public without going through the hassle of traditional IPOs.
In a desperate need to raise capital due to a financial crunch during the pandemic, many private firms considered public listing through SPAC mergers. It takes less time for a company to get listed as a publicly-traded company through SPAC than a traditional IPO.
BuzzFeed owns digital media websites such as BuzzFeed News, HuffPost, and Taste. It also recently acquired Complex Networks, an online media site for streetwear, music, and culture, from Hearst and Verizon for $300 million. The SPAC deal intended to raise money for the acquisition, as well as fund other potential M&A activities.
“Our next chapter as a public company will help BuzzFeed, Inc. become a hub for even more brands and creators, visionary founders and CEOs, high-quality content for the tech platforms, and so much more,” said BuzzFeed founder and CEO Jonah Peretti in a statement.
Picture Credits: Vox