Twist Capital, formed by an ex-Guggenheim and Blackstone executive, is targeting $175 million for a special purpose acquisition company to pursue growth tech deals.
Twist, formed by Sean Madnani, joined the rush of private equity GPs raising money from public market investors to pursue deals outside of the confines of a traditional private equity fund. Madnani is among long-time PE executives that have joined the push to raise SPACs.
Madnani also is targeting $500 million for his debut fund, Buyouts previously reported. Madnani declined to comment on the SPAC and fundraising.
The Beverly Hills firm plans to offer 17.5 million units at $10. Each unit consists of one share of common stock and one-third of a warrant, exercisable at $11.50, the firm said. At the proposed deal size, Twist Investment would command a market value of $219 million, the firm said.
Strong technology opportunities are available in smaller cities in regions removed from the East Coast and West Coast hubs, according to the S-1 filing for Twist Investment Corp.
“Innovation in these second- and third-tier cities remains abundant, particularly as talent is fleeing high-tax bracket and densely packed cities … high-quality, but lesser-known businesses are often unable to efficiently access funding for growth if not located in traditional investment hubs,” the filing said.
Madnani also sees opportunity in the pandemic downturn as the firm looks for tech companies experiencing “dislocation, dysfunction or distress,” according to a white paper the firm filed last year.
“In many cases, the pandemic world has created an enormous need for rapid, nimble and sophisticated funding to enable the survival and prosperity of these companies,” the paper said.
Madnani worked at Guggenheim Partners for almost five years, as a senior managing director and moving into a senior advisor role until March 2020, his LinkedIn profile said. He worked at Blackstone from 2005 to 2015, where he focused on M&A advisory, his profile said. Blackstone moved Madnani to its Menlo Park office to lead M&A advisory on the West Coast and in Asia, the firm said in a statement in 2013.
Other executives at Twist Capital include Richard Fay, managing director, who joined in January 2020, according to his LinkedIn profile. Fay formerly was chief executive and co-founder of Finalist Corp from 2017 to March 2020, his profile said. Fay was managing partner of multi-family office MVS Funds from 2016 to 2017, his profile said.
Charles Lew, who works as small business commissioner for Los Angeles, is an operating partner at Twist, his LinkedIn profile said. And former Guggenheim Partners associate Michael Carter joined Twist last year as a vice president, his profile said.
Some 176 SPACs have raised $54.5 billion so far this year, according to SPAC Data. Last year, 248 SPACs raised more than $83 billion, the most since in the research universe that dates back to 2003.
Another first-timer raising a SPAC is Patient Square Capital, led by ex-KKR healthcare chief Jim Momtazee. Patient Square is sponsoring a SPAC called Montes Archimedes Acquisition Corp that raised $400 million in its IPO in October.