Forbes Goes Public as SPACs Fight Back


Storied business publication Forbes announced that it will be going public in a SPAC deal. Valued at $630 million, Forbes Global Media Holdings Inc. will be acquired by a special-purpose acquisition company (SPAC) called Magnum Opus Acquisition Limited. SPACs have become an increasingly popular method of going public because they permit companies to avoid some of the rigors and regulations of the traditional IPO process. 

Structured as an equity purchase, the deal is expected to raise approximately $600 million in gross proceeds: $200 million in cash from Magnum Opus and $400 million of additional capital via private placement of ordinary shares of the merged company.  Magnum Opus is sponsored by private investment firm L2 Capital. The agreement includes a typical no-shop provision, as has become increasingly the norm across all types of M&A: such prohibitions on the target from soliciting offers from potential acquirers are found in 96% of deals over the past year vs. 73% of deals over the last decade

SPACs have come under attack in recent months with shareholders filing multiple high profile class action lawsuits, including against Bill Ackman’s Pershing Square Tontine Holdings. Regulators have taken notice as well, with the SEC launching investigations. SEC Chairman Gary Gensler has publicly stated his intention to crack down on SPACs and introduce further regulations. Law firms have rushed to their defense, with nearly 60 of the nation’s top firms signing onto a letter arguing against shareholder claims that SPACs should be regulated as investment companies.  The attorneys, who have made significant fees from advising SPACs, argue that they are merely operating companies rather than investment vehicles and should therefore not be regulated as the latter. 

Forbes was advised by law firms Cadwalader, Wickersham & Taft LLP and Goodwin Proctor LLP,. Magnum Opus was advised by law firm Kirkland Ellis LLP, and financial advisor Credit Suisse. Each of the law firms signed the letter in support of SPACs. 

Print media has faced declining profits in recent years, with newspaper industry advertising revenue down another 29% in 2020, continuing a downward trend since its peak in 2005. Accordingly, Forbes has diversified from its traditional print publication to include virtual events, custom marketing programs, and “Forbes Medias brand extensions include real estate, education and financial services license agreements,” according to the deal’s press release