Seattle-based investment bank Cascadia Capital is dissolving its special purpose acquisition company, Cascadia Acquisition Corp. (Nasdaq: CCAI).
CCAI announced the decision on Thursday in a filing with the Securities and Exchange Commission. The SPAC's planned merger with Vancouver, Washington-based headset maker RealWear fell through in April, and CCAI said in the filing it won't close a deal in the time period required by its certificate of incorporation.
CCAI will redeem all outstanding shares of its stock, and the company will cease all operations at the end of August except for actions related to closing down its business. Its shares will also stop trading at the end of August, and CCAI plans to pay the redemption amount within 10 business days of Aug. 31.
Neither Cascadia Capital nor CCAI immediately responded to a request for comment.
SPACs, often referred to "blank-check companies," form without a specific business and start trading publicly with the sole goal of acquiring a private company to take public. Local companies like Rover, Porch and Leafly have all gone public through SPAC mergers. CCAI was targeting companies in artificial intelligence, and robotics and automation.
Going public through SPAC mergers soared in popularity in 2020 and 2021, but popularity of SPACs has plummeted during the current market downturn.
When CCAI agreed to merge with RealWear, the combined company was supposed to have a value of $375.5 million upon closing, assuming no CCAI stockholders redeemed their shares. The plan was for the deal to close in the second half of this year, after which the combined company would trade on the Nasdaq and take the RealWear name.
When the companies canceled the merger, RealWear's then-CEO Andrew Chrostowski said in a statement the company was looking into additional funding strategies, such as a Series D round. He added in the statement RealWear was calling off the deal "due to current market conditions."
Cascadia was founded in 1999. The investment bank offers services in mergers and acquisitions, private capital and equity placement. Cascadia co-founder and CEO Michael Butler moved to Austin, Texas, in October to open the bank's fifth U.S. office after Cascadia landed a more than $50 million investment from Atlas Merchant Capital the previous month.
Cascadia launched CCAI in August 2021. Butler said then that Cascadia's pedigree would separate it from the throngs of SPACs flooding the market at the time. Cascadia planned to continue launching SPACs in the future, he said, but the bank wanted to see CCAI's merger through before launching new SPACs.
"We view the SPAC as an ongoing product for Cascadia. We're not a one-and-done," Butler said in 2021. "We think the companies we partner with will pretty easily be able to delineate between us, our resources, our approach and the other SPACs out there."
