LOS ANGELES (CelebrityAccess MediaWire) — The William Morris Agency has been quietly putting together a hefty fund of $500 million dollars using an arcane type of investment instrument with the aim of acquiring an yet-to-be named entertainment company.
What is a Spac you may ask? A SPAC, or special purpose acquisition vehicle, is a financial tool that is essentially a shell company with the stated purpose of being a repository for funding used to merge with, or the outright acquire another company. Sometimes called a "blank check company", a SPAC is funded by money accrued in an initial public offering, and they have to use the money to complete a transaction before the deadline of 18-24 months or they must be dissolved. SPACs cannot be formed with the intent of acquiring a specific company, so William Morris on on the make.
In putting this together, WMA has gathered an unusual group, including Eric Watson, the SPACâ€™s chairman and treasurer, and Jonathan Ledecky, its president and secretary, both SPAC veterans. Other directors include Ashton Kutcher (yeah, that guy from "The 70s Show"), ESPN sportscaster Jim Grey and Ed Mathias, the media and entertainment honcho at the shadowy Carlylye Group.
As for how WMA will be involved with the company, it is summarized by the following statement from the SEC filing: "William Morris and Mr. Mass have entered into right of first review agreements with us, in which they have agreed to present to us for our consideration any suitable business opportunity to acquire a target business with a fair market value in excess of $375 million, prior to presentation to any other entity, provided such target business allows them to present their company to us. In any event, neither William Morris nor Mr. Mass will seek to acquire such target business or be a principal in such opportunity. In addition, if a client of William Morris has already identified a specific acquisition in which it seeks the assistance of William Morris, William Morris will not be obligated to present such opportunity to us."
This isn't WMA's first foray into the world of finance as they recently launched their Mailroom Fund which is a venture capital firm focused on the digital media sector. – CelebrityAccess Staff Writers