(Bloomberg) -- Roadside-assistance startup Urgently has held talks to go public through a merger with Graf Acquisition Corp. IV, a blank-check firm, according to people with knowledge of the matter.
A transaction features a potential private investment in public equity, or PIPE, and could value the combined entity at more than $700 million, said one of the people, who asked not to be identified discussing private talks. Terms may change and, as with all deals that aren't finalized, talks could fall apart and Graf could pursue another target.
Vienna, Virginia-based Urgently, led by Chief Executive Officer Chris Spanos, said in December it had secured as much as $75 million in debt financing from funds managed by Highbridge Capital Management LLC, Onex Credit and Whitebox Advisors LLC, and separately refinanced and increased a debt facility from Structural Capital.
Urgently's investors include BMW i Ventures, Jaguar Land Rover Automotive Plc's InMotion Ventures, Porsche Ventures and Iron Gate Capital, according to PitchBook.
A spokeswoman for Urgently didn't immediately respond to a request for comment. A Graf representative declined to comment.
Graf Acquisition Corp. IV, based in The Woodlands, Texas and led by CEO Jim Graf and co-Presidents Lew Silberman and Gus Garcia, raised about $172 million in a May 2021 initial public offering. An earlier Graf special purpose acquisition company merged with auto-sensor maker Velodyne Lidar Inc.
SPAC transactions have become increasingly challenged or, in some cases, canceled, in part because redemption rates are skyrocketing past 90%, leaving target companies with proceeds far less than anticipated. A disconnect between public and private market valuations has led some companies pursuing SPAC transactions to instead turn to funding rounds as a means of raising growth capital.
Read more: SPAC Mergers Are Falling Apart at Rapid Pace in Sign of Fatigue
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