Former Credit Suisse CEO’s SPAC Aims for $1.5 Billion Merger
- Former Credit Suisse CEO Tidjane Thiam SPAC Freedom Acquisition I is in talks to merge with Credijusto and CIAL Dun & Bradstreet at a $1.5
- Thiam already raised $345 million in March through an IPO of Freedom Acquisition I on the NYSE
Blank-check SPAC Freedom Acquisition I Corp, helmed by former Credit Suisse CEO Tidjane Thiam, is in talks to merge with Credijusto and CIAL Dun & Bradstreet. The deal would value the new entity at around $1.5 billion, according to Reuters. Thiam, an Ivory Coast native would help the combined company navigate operations in 43 countries, including Africa and the Middle East, once the deal is complete. Freedom Acquisition I planned to target the financial services sector, focusing on businesses that are technology-enabled and demonstrate growth and scalability potential, putting this merger directly in their sweet spot.
Why This Matters: Thiam already raised $345 million in March through an IPO of Freedom Acquisition on the New York Stock Exchange (NYSE). After successfully leading the turnaround of the insurer Prudential (PRU -2.55%) from 2009 to 2014, Thiam took the helm of Credit Suisse in July 2015 and successfully restructured the bank in a financial year in which the firm posted a $3 billion loss. He has a solid proven track record of making companies successful, and would be able to do the same thing with Freedom Acquisition, Mexican fintech group Credijusto and Latin American corporate data provider CIAL Dun & Bradstreet.
For Thiam his tenure oversaw a shift in Credit Suisse’s focus from investment banking to wealth management and, amidst a troubling period for many European banks, before a return to profitability in 2018. As a Black CEO of a major investment bank, a rarity in the finance world, Thiam was beleaguered by a scandal in which the bank conducted spying operations against two departing senior employees.
Credit Suisse posted pre-tax earnings of $3.19 billion in 2019, a 40% increase from 2018 and the best for the firm in a decade. While the spying scandal cannot be overlooked, an investigation by an outside law firm found “zero evidence” that Thiam was involved. Despite no link to the scandals, a turn-around of the bank’s earnings and a vote of confidence from Credit Suisse shareholders, Thiam was still shown the door.
SPAC mania had taken hold of the public markets in 2020, these types of IPOs raised almost twice as much money as they did in the previous 10 years combined, and had already surpassed 2019 levels by March 2021. As of September 2021, SPACs have raised $122 billion in IPOs in the U.S.
With the popularity of blank check companies comes increased scrutiny, because SPACs raise cash in an IPO and then have two years to search for a private company with which to merge and thereby bring public. The primary source of SPACs’ high cost and poor post-merger performance has caused regulators to raise questions related to erratic disclosures and anemic protections for investors.
What’s Next: Freedom Acquisition I is listed on the NYSE under the symbol FACT.U. If this merger between Credijusto and CIAL Dun & Bradstreet comes to fruition, the new entity would list on the NYSE later this year.
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