Broker ThinkMarkets has decided to pull out of its merger deal with FG Acquisition Corp., which would have seen ThinkMarkets listed on the Toronto Stock Exchange at a valuation of $160 million.
The deal, which was first announced in mid-May 2023, would have allowed ThinkMarkets to become a public company and could have raised more than $100 million.
According to FNG, ThinkMarkets' decision to reject the merger with FG Acquisition is a mutual one, especially after the majority of FG Acquisition's public shareholders voted in July to take their money back from the company rather than proceed with the deal. With FG Acquisition unable to attract new investors to continue the deal, the decision by both sides to support the abandonment of the deal is clear.
It is worth noting that November 30th was the deadline for FG Acquisition and ThinkMarkets to agree on a new merger date.
However, many speculate that the return of cash to FG Acquisition shareholders is not the only reason the merger was rejected. Experts also point to possible problems with the approval of the deal prospectus by the Ontario Securities Commission.
Despite the fact that these documents were formally FG Acquisition documents, there were problems with the disclosure of information by ThinkMarkets and its submission to the Ontario Securities Commission, which included updated financial and operational information. This resulted in FG Acquisition withdrawing its prospectus.
The parties have not disclosed their next steps. However, FG Acquisition has until July 2024 to provide information to its shareholders and complete another merger transaction, which will likely require additional financing. If that doesn't happen, the company will be forced to wind down its operations and return funds to shareholders.
ThinkMarkets is expected to continue its journey as a brokerage firm under the Anesami brothers. Faizan and Nauman Anasami are the President and CEO of ThinkMarkets, respectively.
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