Chardan NexTech Acquisition 2 filed a proxy and prospectus on its proposed merger with Dragonfly Energy, which produces deep cycle lithium-ion storage batteries.
The business combination values Dragonfly at an implied $500.1 million pro forma enterprise value. The deal is still expected to close in the second half of 2022, with the combined company listing on the Nasdaq.
As announced last month, estimated cash proceeds are expected to consist of CNTQ’s approximately $128 million of cash in trust (assuming no redemptions) and an additional $230 million consisting of $75 million senior secured term loan (used in part to refinance approximately $45 million of outstanding Dragonfly indebtedness), a $5 million equity investment from CNTQ’s sponsor, Chardan NexTech Investments 2, and a $150 million Chardan Equity Facility from Chardan, an affiliate of CNTQ’s sponsor.
The transaction includes an earn-out provision for up to an additional 40 million shares. Read more.
