Thunder Bridge Acquisition II (Nasdaq: THBR) is closing in on their reverse merger with auto-tech solution company indie. THBR stock has seen a volatile run after announcing the merger in December last year. The stock initially saw a 52 week high of $14.94 a share. However, it is now currently trading at $10.07 a share. The downtrend has been attributed to the market wide tech sell off alongside the global semiconductor shortage. However, the merger is closing in on finalisation with the shareholder vote on the 9th of June at 11am ET. With this in mind, this article will breakdown everything you need to know about the THBR and indie merger in 2021.
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Key details surrounding the THBR merger
- Firstly, the merger is expected to provide the combined company $495 Million in cash proceeds. The cash proceeds will be used to “accelerate the deployment of solutions to existing customers and fund pent-up demand for additional programs”.
- The transaction has an implied equity value of $1.4 Billion.
- Indie currently operates in a $16 billion market which is expected to grow to $38 Billion by 2025
- The combined company will trade publicly on the Nasdaq under the new ticker symbol “INDI.” Post merger, investors will be able to purchase indie Semiconductor stock directly from the market.
“indie is empowering the Autotech revolution with our highly innovative system solutions…Accordingly, we are excited to partner with Thunder Bridge II at this key growth juncture to capitalize on our existing design win pipeline, extend indie’s product reach, drive scale and further consolidate within Autotech, ultimately creating shareholder value as a public company.”said Donald McClymont, indie’s co-founder, chairman and chief executive officer
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What are analysts saying about THBR stock?
Firstly, the average price target for THBR amongst 2 Wallstreet analysts is $18.50 a share. This is suggests an upside potential of 84% from the current trading price. Both targets suggest analysts are bullish on THBR stock as they close in on the indie merger. Here are the two price targets from institutional analysts:
3/12/21 Roth Capital – analysts initiated coverage on THBR stock with a price target of $20 a share. In addition, Roth Capital have set a Buy rating on the stock .
3/09/21 Benchmark – analysts at Benchmark have ignited coverage at $17 a share and have also listed a Buy rating on the stock.
What’s the long term outlook for indie Semiconductor?
Firstly, indie is looking to capitalise on four main secular growth drivers. These are advanced driver-assistance systems, connectivity, user experience and electrification of vehicle production. The company expects to generate $44 Million in revenue in 2021, which is expected to further improve to $91 million in 2022. Furthermore, by 2025 the company expects to generate $501 million ($154 million EBITDA), with future partnerships within the companies pipeline being the catalyst of this projected growth. The projected growth above is provided in indie’s investor presentation here.
Summarising the THBR and indie merger
In summary, the reverse merger looks to provide a strong opportunity for indie Semiconductor’s to further expand into the auto-tech industry. With THBR stock priced close to $10 a share, investors are eyeing in on potential gains indie can provide in the long term. Furthermore, the revenue forecasts over the next 5 years provide investors with confidence in the companies long term strategy. However looking at other recent completed SPAC mergers such as Hyliion and Clover Health, we can also expect volatility post merger.
The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.
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