$BREZ: Italian Space Spac

[25]

$BREZ is a spac that will be merging with D-Orbit. An Italian space transportation company that seems to be a sort of “ride share” company for launching numerous satellites at once, deploying multiple satellites in multiple orbits. A couple articles I read described it as “satellites-as-a-service”. They have actually had successful launches and are working on some pretty cool stuff. Nevertheless, they had revenue last year of $3.4 million and are valued at $1.28 billion based on the transaction…which brings me to the purpose of this DD request. Is this another merger puts candidate? I saw everyones been pretty successful with them, mainly IVAN most recently I believe.
I am not educated on how these deals go down as it relates to the business combination meeting, NAV, redemptions etc. I couldn’t find any SEC stuff to link but I found a reddit thread where everyone was shitting on it so I assume that means my initial thoughts of puts were correct. They have until Feb 25th to combine or they have to add $.10 per share in a trust to extend 3 more months, which they did last november. Also, I noticed when I looked at the chain early today there was 0 anything on the puts. I thought that was odd and figured forget it but I remembered they just announced the news today so maybe that is why. Just randomly came across this on twitter (algorithm infiltrated my mind apparently) and wanted to get this out there early in case there is a play here due to the feb 25th meeting.

I’m just adding this article and the reddit thread as everything else i’ve read thus far says all the same things.

Yes there are options

D-Orbit S.p.A., a Market Leader in Space Logistics, to Combine with Breeze...

https://www.reddit.com/r/SPACs/comments/sdwy4w/brez_deal_with_dorbit/

[Shamu]

Definitely need some SPAC experts on this, it looks interesting.

Regarding Feb 25th, this looks too far out for a DeSPAC play as they are looking to merge in Q2 or Q3 (probably Q3).

So they will probably just increase the NAV by $0.10 to $10.35 on Feb 25 since they already have a merger candidate in mind.

I guess the questions are when will the NAV floor be removed? When will the vote be and when can shares be redeemed?

Bid/ask spread on options is ridiculous right now.

Possible long term bull case if this tanks to $1-3.

[Kevin]

[size=4]Timeline Notes[/size]

On November 22, 2021, BREZ deposited $1,150,000 deposited an aggregate of $1,150,000 (the “Extension Payment”), representing $0.10 per public share, into the Company’s trust account in order to extend the date by which the Company has to consummate a business combination from November 25, 2021 to February 25, 2022.

• Looks like NAV is $10.10, and the float is 11,500,000 shares with redemption rights.
• They have until February 25 to complete the merger. I think this means full de-SPAC.

Source

Today was a press release for the definitive agreement.

• Company is valued at 1.28B, equating to 2.8x 2024 revenue and 0.8x 2025 revenue, they claim.
• Transaction is expected to close in Q2 or Q3 2022.

Wait a second, so they have until February 25 to complete the merger, but the transaction is expected to close in Q2 or Q3… I think they will go for another extension and again raising the NAV floor. I am not sure how many times they can do this, but nonetheless looks like it is too early for de-SPAC puts.

We are waiting for the next stage where they announce the shareholder meeting to vote for the merger as well as the redemption date.

[size=4]Investor Presentation[/size]
Here it is: D-Orbit

Total Backlog of 19M.
Total Contracts in Negotiation to 2024: 147M
Total Pipeline of 1.1B. See fine print:

Pipeline is defined as potential future contracts based on customers discussions and D-Orbit estimates including latest constellation planning, upcoming institutional/private programs, and extension of existing sale contracts up to 2026

Lofty Revenue Projections

Lofty Cash Flow Projections

Hey look they compare themselves to the server favourite: ASTR.
Also I see ASTS on here.

[size=4]Conclusion[/size]
We are waiting for the next stage where they announce the shareholder meeting to vote for the merger as well as the redemption date.

And then we load the puts.

[25]

Thanks man! Wondering if it were to get pushed back again with a 1.1 mil float if it would be a potential gamma candidate since its 3 months. I guess no sense in thinking about anything until the meeting. Appreciate the input very very much!

[Kevin]

Sorry, my mistake, the float is 11,500,000, not 1.1M haha. Edited now.

But yes depending on redemptions and options chain, could be a gamma squeeze candidate with the right factors and alignments. Worth revisiting later.

[RefirgerateMyESSCash]

As speculated as a possibility back in January above, this is emerging as a potential ESSC/THCA-like optionable SPAC → extension vote → high redemption → low float → gamma squeeze play.

Pre-vote float was apparently 11 million, with extension vote taking place on May 3rd. NAV is and was 10.35, and the shares were consistently trading below that level so there is grounds for thinking that redemptions will be high.

Although I don’t recall the original ESSC setup perfectly, what sets this apart (in a good way) from THCA is that it (a) has a merger target, and (b) already has well-developed call OI on the chain. There is currently about 12,000 OI on 10c for May, with 5,500 on 12.5c (with 2,400 more volume today). If redemptions are 90% or higher, then over 100% of the float would immediately be covered by ITM OI. It also seems a lot less likely that only one holder (Puzzleheaded from Reddit) has stacked half the ITM OI himself, as was the case on THCA.

I wouldn’t risk buying anything other than commons or 10c until redemption numbers are confirmed, but this could be a good 10c/12.5c scalping opportunity similar to THCA. If redemption numbers are high another Reddit pump seems possible.

[25]

Thats because I beat puzzleheaded this time being 5 months early and frontloaded myself :pepeevil:
jk im poor. Crazy this was Januray time flies I hate it.
Kinda feels like these plays are becoming less and less popular with the market taking all the fun money out of it. I’m no expert though so always hopeful for another gamma squeeze. Any idea when redemption numbers come out? Is is random or a certain date given the current situation? Haven’t went back to look since I just saw your comment but if I remember correctly the financials and outlook were 100% retarded. Basically these startup and tech valuations on steroids. I know fundamentals don’t matter for potential gamma squeezes but since theres been a number of tickers with similar or identical setups to ESSC (low float w/ NAV) that didn’t do anything, I feel like there has to be something of substance for the internet to grab hold.

[derfam]

When can we expect to see redemption numbers?

Jun 10c are basically trading at intrinsic right now, could be worth a gamble as there’s very little downside.

[RefirgerateMyESSCash]

Not sure when to expect redemption numbers. I believe it is typically 2 or 3 days after the vote (which was today I think) but could be as early as Friday.

[Kevin]

Wow, nice keeping up with this one. I forgot I even looked into this before. I just scrolled up and re-read my previous comments and I think there is a good chance that redemptions will be high. This could be a double whammy play where we can ride it up before the merger and then down after the merger when shares get unlocked and whatnot.

[RefirgerateMyESSCash]

You make a good point in that having a laughably overvalued target could cut against this in a way that it didn’t with THCA (which miraculously became a darling of r/SPACs), as people can then continue to dream that a unicorn DA lands during the middle of a gamma squeeze effort.

But it might also make redemptions likelier.

Full disclosure: I have a smallish 10c position )mostly getting fills at 0.50) and am considering adding to it on Friday, especially if redemption numbers are 80+%.

[Kevin]

05/20 10c has been steadily building every day

and 12.5c

I wonder if someone is getting ready to pump this.

[thots_and_prayers]

We’ve had China, we’ve had Russia… time for Italy

[nano]

Some of us did China too.

[RefirgerateMyESSCash]

Not a bad idea to go for 10c if we can get keep getting fills at 0.50 (with being able to sell at 0.35 a worst case scenario most likely), but I’d caution against slapping the ask in true Valhalla fashion until we know where redemptions shake out.

[Kevin]

Took some June 12.5c lottos

OI on May and June increased

Adding some info on timelines. Here’s the latest SEC filing from May 5.

tl;dr

• Shareholders voted in favour of an extension to complete the merger with D-Orbit to September 26, 2022.
• The merger with D-Orbit is expected to close in Q3 2022, e.g. July 1 to September 26.
• Redemption numbers will be released in an upcoming 8-K filing.

This means that the 05/20 and 06/17 options expirations should be safe from a merger vote that could kill the NAV floor.

Link to SEC filings, waiting for results: https://www.nasdaq.com/market-activity/stocks/brez/sec-filings

[xianchen]

I like this risk/reward for commons. Entered with around 1500 shares and a few scattered calls. I can possibly see this developing into an ESSC type play. IMO enter early and limit the downside if you are to play.

Hopefully redemption numbers send the price higher.

[derfam]

June 10c are currently trading at the same price as May 10c. This seems like a great risk/ reward, bought in with some June 10c

[xianchen]

Thanks, picked some up as well.

[RefirgerateMyESSCash]

I hope that’s not us slapping the ask…