Foresite Capital Jumps Back Into SPAC Frenzy With Second Shell Company

Nasdaq_Alex Tai/SOPA Images/LightRocket via Getty

Alex Tai/SOPA Images/LightRocket via Getty Images

Foresite Capital is returning to the SPAC frenzy with its second blank check shell company. The new company, FS Development II, announced this week it raised $175 million in an upsized offering at $10 per share. The shares will be listed on the Nasdaq under the ticker symbol FSII.

The new shell company is helmed by president and chief executive officer Jim Tananbaum. FS Development II was formed for the purpose of merging with a life sciences company to provide a quicker route to becoming a publicly-traded entity than a traditional initial public offering.

Tananbaum’s last outing with a SPAC resulted in a successful merger with Gemini Therapeutics in the fall of 2020. Cambridge, Mass.-based Gemini merged with FS Development Corp., a special purpose acquisition company created by Foresite Capital. Gemini raised approximately $216 million through this offering, a combination of Funds held in FSDC’s trust account and the concurrent private investment in public equity (PIPE). Gemini finally hit the Nasdaq earlier this month and is currently trading at $12.95 per share.

SPAC mergers have become something of a craze among life sciences companies. Last year, there was a 250% increase in SPAC mergers. In Foresite Capital’s announcement, there was no indication of the type of company it hoped to merge FS Development II with. Based on the continued popularity of SPACs, it’s unlikely Tananbaum and Foresite will have to wait long.

Earlier this week, North Carolina-based Humacyte merged with special purpose acquisition company Alpha Healthcare Acquisition Corp. The SPAC, which raised $100 million, was led by Rajiv Shukla, who led an earlier SPAC which merged with DermTech Inc. in 2019.

Humacyte and Gemini aren’t the only companies to find a way to the stock exchange through a SPAC. Seattle-based Nautilus Biotechnology merged with Arya Sciences Acquisition III, a SPAC sponsored by Perceptive Advisors. The deal gave Nautilus a $350 million infusion in cash and gave the company a $900 million valuation. Perceptive also scored last year with Pfizer spinoff, Cerevel.

Boston-based Cerevel entered into a business combination deal with Arya Sciences Acquisition Corp II, a SPAC sponsored by Perceptive Advisors at the end of July. Cerevel began trading on the Nasdaq at the end of October.

DNA-testing giant 23andMe also took the SPAC route earlier this month. The deal was helmed by billionaire investor Sir Richard Branson. 23andMe raised $759 million from the deal and drove the company’s valuation to $3.5 billion.

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