Phoenix Biotech Acquisition in an 8-K said it received notice from the Nasdaq Listing Qualifications Department that the SPAC had fallen out of compliance with a rule requiring at least 400 public stockholders to remain on the exchange.
The SPAC has 45 days to submit a plan to regain compliance and, if the Nasdaq accepts, Phoenix Biotech would then have up to 180 days to cure the deficit. The SPAC can also appeal if the echange rejects the plan.
Phoenix in June signed a merger agreement with CERo Therapeutics at a pro forma equity capitalization of $145 million. The target is an immunotherapy company seeking to advance the next generation of engineered T cell therapeutics that employ phagocytic mechanisms.
Aassuming no redemptions, CERo would expect to receive up to $13.7 million of cash held in the SPAC’s trust at deal announcement. The business combination reflects a pre-money equity value of $50 million for CERo. The business combination is subject to a minimum cash condition of $30 million, net of expenses, which is expected to be funded through the SPAC’s trust and additional financing, including investments from existing CERo stockholders via a PIPE.
Phoenix Biotech in July won shareholder approval for an extension up to Jan. 8, 2024.
The SPAC last December mutually terminated a $136 million deal with Intrinsic Medicine.
Phoenix Biotech raised $155 million in an October 2021 IPO with plans to target healthcare or healthcare related industries in the United States and Europe, especially life sciences companies. Redemptions since then have erases more than 90% of the trust. Read more.
