GCT Semiconductor, a leading provider of LTE, IoT, and 5G semiconductor solutions, is set to merge with Concord Acquisition Corp III, a special purpose acquisition company (SPAC). The merger will result in GCT becoming publicly traded on the New York Stock Exchange (NYSE) under the ticker symbol "NYSE:GCTS". The transaction values GCT at an initial enterprise value of $461 million, which is expected to increase to $661 million pro forma, incorporating 20 million performance-based earnout shares.
The merger has received unanimous approval from both GCT's and Concord's boards of directors and is now awaiting approval from their respective stockholders. The deal is anticipated to close in the first quarter of 2024, subject to customary closing conditions.
Upon completion of the merger, the combined entity is expected to generate approximately $87 million in gross proceeds. This funding will support further development of GCT's full-band 5G chipset portfolio and expansion into new markets. Around $43 million of this funding will be sourced from fully committed Private Investment in Public Equity (PIPE) and convertible note financing from both existing and new investors.
John Schlaefer, CEO of GCT Semiconductor, views the partnership as an opportunity to strengthen GCT's operations and fund their 5G product development. Dr. Kyeongho Lee, GCT's Chairman, considers the deal a significant milestone in GCT's mission to innovate wireless solutions in the semiconductor industry.
GCT Semiconductor boasts over 120 global patents and multiple 5G partnerships. It has successfully commercialized single-chip 4G (CAT3/4) LTE solution, 4x4 MIMO 4.5G (CAT7) LTE solution, and the 8RX 4.75G (CAT12) LTE solution. The company is currently developing a full-band and full-features 5G chipset portfolio for global markets.
Concord Acquisition Corp III, sponsored by Concord Sponsor Group III LLC, an entity affiliated with Atlas (NYSE:ATCO) Merchant Capital LLC, raised $345 million in its initial public offering in November 2021. The company agreed to combine with GCT based on a $661 million pro forma enterprise valuation. Post-transaction, GCT's board of directors is expected to consist of seven members.
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