A $2 billion so-called Spac deal involving Rezolve, a software start-up founded by Dan Wagner, is yet to be completed more than a year after it was announced.
In December 2021 Rezolve said it was combining with Armada Acquisition, an American special purpose acquisition company listed on the Nasdaq exchange in New York, and said it would raise up to $190 million through the merger. Recent filings with the US Securities and Exchange Commission show that a deadline to “consummate” the deal with Armada has been extended until February 17.
A blank-cheque or special purpose acquisition company, or Spac, is a publicly traded entity that is founded and raises funds to merge with or buy another business that consequently gains a stock market listing.
Under the terms announced in December 2021, either side could terminate the deal if it was not “consummated” by August 31, 2022. It also allowed either side to terminate their agreement if the money raised was below $50 million.
November’s amendment to the deal has “deleted this provision in its entirety”. It also has been restructured so that Rezolve, the UK-registered entity, rather than Rezolve Group Limited, a Cayman Islands company, will be the listed entity when the deal is closed. Under the amendment to the deal, from July the board can increase the number of shares under its incentive plan by up to 5 per cent per year, subject to shareholder approval.
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Wagner, 59, chief executive and founder of Rezolve, started out as a salesman in a hi-fi shop in London before pursuing business ventures that included Dialog, an information company that was sold to Thomson for $275 million in 2000. Other directors include John Wagner, 90, Wagner’s father, and Sir David Wright, 78, a former British ambassador. Justin King, 61, the former boss of J Sainsbury, is an adviser.
The company was incorporated in 2015 shortly before the collapse of Powa, a similar ecommerce venture of Wagner’s. Wagner had personal guarantees over debts at Powa and a bankruptcy petition was removed after a settlement was reached.
Administrators appointed at Powa had intercepted a deal to license assets to Soul Seeker. Rezolve was incorporated as Soul Seeker but changed its name to Powa Commerce in 2016, shortly before it became Rezolve.
Rezolve had said in December 2021 that $40 million of investment was coming from Betsy Cohen, a serial Spac creator, and Christian Angermayer, an existing shareholder and cryptocurrency investor.
In response to questions about the delay to the deal, Wagner said: “Everything remains on track.” He said last month that Rezolve had “made progress in a number of areas in 2022, including new distribution partnerships, new products and key personnel hires”.
