Cartesian Growth Corporation II (NASDAQ:RENE), a special purpose acquisition company, has announced an extension to the deadline for completing its initial business combination.
On Monday (NASDAQ:MNDY), the company's shareholders approved an amendment to the company's charter, allowing for an extension from the original deadline of November 10, 2024, to a new deadline of December 5, 2025.
The extension allows Cartesian Growth Corporation II to extend the deadline on a monthly basis for up to twelve months. To facilitate this extension, the company's sponsor, CGC II Sponsor LLC, has agreed to deposit into the trust account $150,000 for the first month, with potential additional deposits of up to $2.4 million for subsequent monthly extensions.
Additionally, the company has issued an unsecured promissory note to the sponsor in the amount of up to $2.4 million, known as the Extension Note.
The Extension Note carries no interest and is payable upon the consummation of the company's initial business combination. In a related move, the company also issued a $250,000 Working Capital Note to the sponsor to provide additional working capital for the company.
In the same shareholders' meeting, an amendment was approved to eliminate a clause in the company's charter that prevented the redemption of Class A ordinary shares if it would cause the company's net tangible assets to fall below $5,000,001 upon completion of the business combination.
The company disclosed that in connection with the approval of the extension, shareholders exercised their right to redeem 8,620,849 shares for approximately $11.55 per share, totaling approximately $99.6 million. This redemption leaves around $83.8 million in the trust account.
The information presented in this article is based on a press release statement from Cartesian Growth Corporation II filed with the Securities and Exchange Commission.
In other recent news, Cartesian Growth Corporation II has announced a preliminary agreement with an undisclosed entity in the risk-reduction products sector.
This potential business combination, if finalized, could position the company as a market leader, with a projected adjusted EBITDA exceeding $100 million for the year 2025. However, the company emphasized that there is no guarantee of a definitive agreement or successful completion of the transaction.
The company has also made certain strategic financial moves. It amended its Trust Agreement, enabling trust account funds to be placed in an interest-bearing bank demand deposit account. This change is part of the company's strategy as it extends the period to complete a business combination until November 10, 2024.
Additionally, Cartesian Growth Corporation II issued an unsecured promissory note valued at $250,000 to its sponsor, CGC II Sponsor LLC. This note will be due upon completion of the company's initial business combination or the effective date of the company's winding up.
Furthermore, the company has extended its deadline to complete an initial business combination to October 10, 2024, marking its ninth one-month extension.
As part of this extension process, Cartesian Growth Corporation II has drawn $150,000 from an unsecured promissory note with CGC II Sponsor LLC. These developments highlight the company's ongoing efforts to finalize a business deal within the given timeframe.
InvestingPro Insights
As Cartesian Growth Corporation II (NASDAQ:RENEU) navigates its extended timeline for completing an initial business combination, InvestingPro data offers additional context for investors. The company's market capitalization stands at $250.47 million, reflecting its current valuation in the SPAC market. With a price-to-earnings (P/E) ratio of 31.76, RENEU is trading at a premium compared to many traditional companies, which is not uncommon for SPACs anticipating future growth through acquisition.
InvestingPro Tips highlight that RENEU's stock generally trades with low price volatility, which could be appealing to risk-averse investors during this extended search period. Additionally, the stock is trading near its 52-week high, with its price at 90.82% of the peak, suggesting investor optimism about the company's prospects. However, it's worth noting that RENEU does not pay a dividend, which is typical for SPACs focused on growth through acquisition rather than immediate income generation.
For investors seeking a deeper understanding of RENEU's potential, InvestingPro offers 5 additional tips that could provide valuable insights into the company's financial health and market position. These tips, along with real-time metrics, can help investors make more informed decisions as they monitor the company's progress towards its business combination goal.
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