Cartesian Growth Corporation II (NASDAQ:RENEU), a blank check company with a market capitalization of $151.32 million, has announced the extension of its deadline to complete an initial business combination. On Monday, the company's board approved the first of up to twelve one-month extensions, now giving Cartesian until January 5, 2025, to finalize a merger or acquisition. The stock is currently trading near its 52-week high of $11.80, suggesting investor confidence in the company's prospects.
This extension was facilitated by a drawdown of $150,000 from an existing unsecured promissory note with CGC II Sponsor LLC, the company's sponsor. The note, dated November 6, 2024, allows for borrowings of up to $2.4 million. The funds drawn will be deposited into Cartesian's trust account, which was set up during its initial public offering. InvestingPro analysis reveals the company's current ratio of 0.09, indicating tight liquidity management is crucial for its operations.
The move to extend the business combination period suggests that Cartesian is taking more time to find a suitable merger target. The company, which is classified under the "blank checks" industry, is typically formed to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses.
In other recent news, Cartesian Growth Corporation II has announced several significant developments. The company has extended its deadline for completing its initial business combination from November 10, 2024, to December 5, 2025, following an amendment to the company's charter approved by shareholders.
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.
The company has also issued an unsecured promissory note to the sponsor in the amount of up to $2.4 million, known as the Extension Note. Additionally, a $250,000 Working Capital Note was issued to the sponsor to provide additional working capital for the company.
In another development, Cartesian Growth Corporation II has entered into 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.
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