425: Maquia Capital Acquisition Corp. Announces Business Combination with Immersed Inc.

Maquia Capital Acquisition Corporation is set to merge with Immersed Inc., a spatial computing company, to enhance productivity for knowledge workers.

Summary

• Maquia Capital Acquisition Corporation (Maquia) and Immersed Inc. have entered into a Business Combination Agreement.
• Maquia filed a registration statement on Form S-4 with the SEC, including a preliminary proxy statement/prospectus.
• The transaction is expected to close in Q2 2024.
• Existing Immersed shareholders are anticipated to own 53% of the company on a proforma basis.
• The post-money public entity is valued at $297M EV.
• The equity value is assumed at $284M.
• Immersed has raised $16,000,000 to date.
• Immersed has achieved early traction with 1,000,000+ unique users and 87,000 peak monthly active users in March 2024.
• Users have spent 1.5 millennia in Immersed since listing on the Meta Quest App Store.
• Users logged 20 million minutes in Q1 2024 alone.
• Immersed has received $500,000 in pre-orders for Visor headsets in the first week, targeting 50,000 pre-orders within the first year of launch.
• The company expects to have a financing facility of at least $7mm at closing.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive due to the potential of the business combination, Immersed's user growth, and the projected revenue growth. However, the risks associated with the transaction and the un-audited financial projections temper the overall sentiment.

Positives

• Immersed has shown strong user engagement with over 1 million unique users and significant time spent in the application.
• The company has secured substantial pre-orders for its Visor headsets, indicating market demand.
• The business combination provides Immersed with access to public markets and additional capital to accelerate growth.
• Immersed is the highest rated work app on the Meta Quest Store.
• Immersed has a diverse global reach with users in 190 countries and territories.

Negatives

• The investor presentation contains projected financial information that has not been audited.
• The assumptions and estimates underlying such financial forecast information are inherently uncertain and are subject to a wide variety of significant business, economic, competitive and other risks and uncertainties.
• The company experienced negative EBITDA and EBIT margins in 2022, 2023 and is projected to experience negative EBITDA and EBIT margins in 2024 and 2025.

Risks

• The inability to complete the Business Combination in a timely manner or at all.
• The risk that the Business Combination may not be completed by Maquia's initial business combination deadline.
• Potential legal proceedings following the announcement of the Business Combination.
• Failure to obtain stockholder approval for the Business Combination.
• The occurrence of any event that could lead to the termination of the definitive agreement.
• Conflicts of interest of Maquia's management with its public stockholders.
• Changes to the proposed structure of the Business Combination.
• The ability to meet stock exchange listing standards following the consummation of the Business Combination.
• The effect of the announcement on Immersed's business relationships and operations.
• The ability to recognize the anticipated benefits of the Business Combination.
• Changes in applicable laws or regulations.
• Economic, business, and/or competitive factors affecting Maquia, Immersed or the post-combination company.
• Volatility in the price of Maquia's or Immersed's securities.
• Risks related to the spatial computing software market in general.

Future Outlook

Immersed projects significant revenue growth in the coming years, driven by enterprise SaaS and AI API growth, with the goal of becoming a virtual office for knowledge workers.

Industry Context

The announcement highlights Immersed's position in the growing spatial computing market, targeting the enterprise collaboration software, computer monitor, artificial intelligence, and corporate training markets. The company is leveraging partnerships with tech giants to expand its reach.

Comparison to Industry Standards

• The document compares Immersed to public comparables, benchmarking revenue CAGR (24-26).
• Immersed is positioned as a high-quality alternative to the Apple Vision Pro at 1/4th the cost.

Stakeholder Impact

• Shareholders of Maquia and Immersed will be impacted by the Business Combination and will need to vote on the proposed transaction.
• Employees of Immersed may benefit from the increased resources and opportunities resulting from the merger.
• Customers of Immersed may see enhanced product offerings and improved services.
• The combined company's suppliers and creditors may experience changes in their relationships due to the merger.

Next Steps

• Maquia and Immersed will mail a definitive proxy statement/prospectus to their respective stockholders.
• Stockholders' meetings will be held to approve the Business Combination and related matters.
• The Business Combination is expected to close in Q2 2024.

Key Dates