Kuwait headquartered global logistic company, Agility, has invested $35 million in the US-based blank-cheque firm Queen’s Gambit Growth Capital.
The blank-cheque companies, formally known as the special purpose acquisition companies (SPAC), are basically investment vehicles that raise money on public markets with the aim of acquiring or merging with a private firm. SPACs need to complete an acquisition within two years of raising funds and if they fail to do this, the fund has to be given back to investors.
With the fund raised from Agility, the Queen’s Gambit intends to boost its investment in businesses offering sustainable solutions in clean energy, health care, fintech, industrials, mobility and emerging technology.
“Agility’s investment in Queen’s Gambit reflects our commitment to sustainability and our belief that innovative technology can yield both social and economic returns. This is not a new position for us. We’ve been investing in stakeholder capitalism for more than a decade. The company has the potential to tap into a differentiated network and perspective that positions it to execute a business combination with an attractive target.”
Founded in 2020, Queen’s Gambit also has an all-female board and management team, with New York-based venture capitalist Victoria Grace as its chief executive.
The Middle East and North Africa (MENA) region’s one of the largest logistic firms, Agility is among a few firms that have publicly invested in SPACs, which as per Goldman Sachs’ calculation has raised a record of $70 billion last year and helped to fuel a rally in Wall Street listings.
SPACS has attained traction among investors amid the pandemic as an alternative to initial public offerings (IPO). In a blank-cheque merger, companies can pitch to investors using forward-looking financials, which is not allowed for traditional IPOs but is more beneficial for early-stage companies.
Even though SPACs have their risks, it has not stopped major investors from weighing in. Last year, the Japanese multinational company Softbank said it will launch a SPAC to raise $525 million to invest in a technology company.