A special purpose acquisition company (SPAC) founded by former professional baseball star Alex Rodriguez is planning to take a Falls Church startup public, but the young company is hoping to raise additional funding before then.
Lynk Global, which provides mobile network service to cellular devices using low-earth orbiting satellites, signed a definitive business combination agreement with Rodriguez's Slam Corp. in February and a deal is expected to close in the second half of 2024. The company would then be renamed Lynk Global Holdings Inc. and trade under the LYNK ticker on the Nasdaq stock exchange. If consummated, the deal could value Lynk Global at as much as $800 million.
Founded in 2017 by CEO Charles Miller, Chief Operating Officer Margo Deckard and Chief Technology Officer Tyghe Speidel, Lynk Global can supply mobile service to devices across the planet via satellites in space, potentially bringing consistent cell coverage to areas of the globe where it is spotty or even nonexistent. Its patented "sat2phone" technology allows cellular devices in urban and rural areas to achieve service and with speeds between 2G and 5G.
SPACs, often called blank-check companies, are publicly listed entities designed to merge with an existing company that's seeking an alternative, sometimes speedier, path to a traditional public offering. Rodriguez's SPAC launched in February 2021 — at the height of a nationwide boom in SPAC formations — and struck its agreement with Lynk roughly three years later.
"Lynk seeks to connect the world by extending cell coverage everywhere," Rodriguez said in February. "The combined company is set to deliver Lynk’s innovative, patented technology to areas that need it most and connect the more than two billion unconnected people worldwide."
Most of Lynk Global's roughly 50-person workforce is based in Greater Washington. The startup is actively working to get several of its own satellite constellations placed in orbit by the end of this year, which will work alongside the existing, commercially licensed satellites it's using to offer service in about 50 countries.
To get more of its own satellites in space quickly, Lynk is aiming to raise additional capital ahead of the SPAC merger. It's working with BTIG LLC, a San Francisco investment firm, to help it raise about $40 million in Series B funding, which would be used to design and create more satellites, obtain access to launch pads and support the operations of its satellites. Miller, the CEO, is counting on the planned SPAC deal to help the company attract additional capital.
“Through our proposed business combination with Slam, we believe Lynk will be well-positioned to raise capital through several avenues," he said in a February statement. "The capital we intend to raise will accelerate our growth as we execute our plan to launch many more 'cell-towers-in-space.'"
Lynk Global, which has raised at least $25 million to date, said it is not expecting to generate revenue until 2025 at the earliest, according to an S-4 document filed with the Securities and Exchange Commission. Should it succeed in reaching its goal of having 21 satellites in space by the end of this year, revenue could hit $10.3 million in next year's second quarter and $41.3 million by the end of 2025.
SPAC activity has slowed considerably amid rising interest rates and other factors, though some deals are still happening locally.
Gaithersburg-based 99 Acquisition Group Inc. announced in February that it'd take Baltimore-area Nava Health public as part of a SPAC deal valued at up to $320 million. Addimmune, an HIV gene therapy research-focused unit of Rockville-based American Gene Technologies International Inc., is also planning to go public deal via a merger with the SPAC 10X Capital Venture Acquisition Corp. III that values the company at around $500 million.
Other deals, though, have fallen through.
X-Energy Reactor Co. LLC, a Rockville company that builds small nuclear reactors and fuel technology, called off its SPAC deal in November 2023 amid "challenging market conditions." And D.C.-based C5 Acquisition Corp., a SPAC, shut down about two years after it raised $287.5 million in an initial public offering after failing to find a company to merge with and take public.
