Quantum News Nexus

I admit there have been so many announcements in recent months of quantum companies planning to go public that I have let one or two pass without comment. One of those was last month’s news that Terra Quantum’s announced an intention to merge with special purpose acquisition company Mountain Lake Acquisition Corp. II.

Well, the quantum software and security firm has given me another opportunity because it announced this week that changed SPAC partners, and now plans to merge with Axiom Intelligence Acquistion Corp. 1. The notion of a company changing its SPAC merger partner before closing a previously-announced deal is not without precedent, but has not happened before in the quantum sector.

Terra Quantum’s statement on the change: “The [new] transaction values Terra Quantum at an equity value of approximately $3.5 billion, representing an increase from the valuation contemplated under the Company’s previously announced non-binding letter of intent with another special purpose acquisition company. The enhanced valuation reflects Terra Quantum’s continued commercial growth, expanding strategic partnerships, and ongoing development of its quantum technology platforms.”

The St. Gallen, Switzerland-based quantum company’s previous agreement had been described as a $3.25 billion deal, so the new deal represents a $250 million boost in total value. Terra Quantum’s announcement appeared to come just a couple hours after a report that Mountain Lake’s “exclusivity” on merger negotiations had expired.

The new deal, like the old one, is expected to close in the second half of this year, and result in Terra Quantum being traded on Nasdaq under the symbol “TQ”. The company expects $190 million in gross proceeds, though that assumes no redemptions by Axiom shareholders. The merger partners also may pursue addition PIPE financing, which has become increasingly common as a way of lessening the risk and effects of a mass redemption event related to a SPAC merger.

Terra Quantum is still led by its founder, Markus Pflitsch, after about seven years in business. It has had major engagements with the US Air Force, HSBC and others, and was one of Nvidia’s earliest partners.

Image by freepik.