425: Webull to Go Public via Merger with SK Growth Opportunities Corporation, Valued at $7.3 Billion

Webull, a digital investment platform, plans to list publicly through a business combination with SK Growth Opportunities Corporation, valuing the combined entity at approximately $7.3 billion.

Summary

• Webull Corporation, a digital investment platform, has entered into a definitive business combination agreement with SK Growth Opportunities Corporation (SK Growth), a special purpose acquisition company.
• The transaction will result in Webull becoming a publicly listed company, retaining its name and listing its ordinary shares on NASDAQ under a new ticker symbol.
• The implied pro forma enterprise value of the combined company is approximately $7.3 billion, assuming no further redemptions by SK Growth shareholders.
• Webull's shareholders will maintain 100% of their existing equity holdings and are expected to own approximately 98% of the combined company after the closing, assuming gross proceeds of approximately $100 million to Webull in connection with the Proposed Transaction from funds held in the SPAC trust account.
• The transaction, unanimously approved by both boards, is expected to close in the second half of 2024, pending regulatory and shareholder approvals.
• Webull operates in 15 regions globally, serving 20 million registered users with access to global financial markets.
• In 2023, the Webull platform facilitated approximately $370 billion in equity notional volumes and 430 million options contracts traded.
• The company's management team combines expertise from both technology and financial services industries.

Sentiment

Score: 8

Explanation: The document presents a positive outlook on Webull's future prospects, highlighting its strengths, growth potential, and the benefits of the merger. The management commentary is optimistic, and the transaction is expected to provide Webull with additional capital and expertise.

Positives

• Webull gains access to public markets and potential for increased capital.
• SK Growth provides expertise and network to support Webull's growth.
• Webull's existing shareholders retain significant ownership in the combined company.
• The combined company will have a strong management team with global experience.
• Webull has a large user base and significant trading volume, indicating strong market presence.

Risks

• The transaction is subject to regulatory and shareholder approvals, and may not be completed.
• Redemption requests by SK Growth shareholders could reduce the cash available to the combined company.
• The combined company will face competition in the digital investment platform market.
• Changes in laws and regulations could adversely affect Webull's business.
• The company's international operations are subject to various risks.
• The company's estimates of expenses and profitability may not be accurate.

Future Outlook

The combined company expects to leverage the transaction to expand its holistic approach to retail investors and bolster growth in existing and new markets as a public company.

Management Comments

• Anquan Wang, Founder and CEO of Webull Corporation: 'The business combination with SK Growth marks a significant milestone for Webull. We believe SK Growths partnership and experience fully aligns with our long-term vision to make Webull the platform of choice for the new generation of investors globally.'
• Anthony Denier, Group President of Webull Corporation: 'Webull addresses critical pain points within the retail investing customer landscape, where traditional providers offer restricted mobile functionality and are suited for investors behind a computer. Webull was created to bridge the gap by providing users with both advanced trading capabilities and robust educational resources. We expect this business combination will enable us to further expand our holistic approach to retail investors.'
• Richard Chin, CEO and Director of SK Growth Opportunities Corporation: 'We are very excited to be joining forces with the Webull team, given their strong track record in the FinTech industry. We are confident that capitalizing on our experience and network globally will bolster Webulls growth in existing and new markets as a public company.'

Industry Context

The announcement reflects the ongoing trend of fintech companies seeking public listings to fuel growth and expansion in the competitive digital investment platform market.

Comparison to Industry Standards

• Webull's valuation of $7.3 billion places it among the higher-valued fintech companies.
• Comparable companies in the online brokerage space include Robinhood (HOOD), which has faced scrutiny regarding its business model and regulatory compliance.
• Other competitors include traditional brokerage firms like Charles Schwab (SCHW) and Fidelity, which are also adapting to the digital landscape.
• Webull's focus on a mobile-first experience and advanced trading tools differentiates it from some competitors.
• The company's global presence and expansion plans align with the trend of globalization in the financial services industry.

Stakeholder Impact

• Shareholders of SK Growth will have the opportunity to participate in the potential growth of Webull.
• Webull's customers will benefit from the company's increased resources and ability to expand its product offerings.
• Employees of Webull will have opportunities for career growth and development.
• The transaction could create value for other stakeholders, such as suppliers and partners.

Next Steps

• Obtain regulatory and shareholder approvals.
• File and declare effective the Registration Statement with the SEC.
• Complete the business combination in the second half of 2024.
• List the combined company's ordinary shares on NASDAQ under a new ticker symbol.

Key Dates