Private securities market Forge Global goes public via SPAC in $2bn deal

Rick Steves

The Forge marketplace has nearly 400,000 registered users, including over 123,000 accredited investors, the firm stated

Forge Global has agreed to merge with Motive Capital Corp, a special purpose acquisition company sponsored by affiliates of Motive Partners, in order to go public in a $2 billion deal.

Once the transaction is complete, by Q4 2021 or Q1 2022, Forge will become a publicly-traded company and will be able to further expand its liquidity solutions, exclusive data and insights and vibrant marketplace.

The private market operator helps companies, their employees and investors to exhchange private shares. Employees can sell them, employers can reward shareholders with pre-IPO liquidity, and institutional investors can participate in private unicorn growth.

As demand for exposure to private company stocks from individual and institutional investors continues to rise, Forge Global has been able to build a growing network effect with defensible competitive advantages.

The firm said private company coverage on the platform has continuously increased, with a 114% increase in distinct private companies traded in the period between January 1, 2018 and June 30, 2021. Similarly, its customer base has grown 225% in the same period.

The Forge marketplace has nearly 400,000 registered users, including over 123,000 accredited investors, the firm stated. Private shares have traded in more than 400 companies since inception, representing over $10 billion in volume across 19,000 transactions with buyers and sellers in 70 countries. Through its custody offering Forge Trust, the company has approximately $14 billion in assets under custody and about $600 million of cash across 1.9 million customers.

Kelly Rodriques, Chief Executive of Forge Global said: “We firmly believe that everyone should be able to participate in the private markets, and we have strategically invested in the development of technology to operate what we believe to be an efficient and liquid market, connecting a large number of private companies, shareholders and investors.

“The confidence and commitment demonstrated by Motive Capital Corp, and other leading investors is a testament to our business model, the strength of our team and the huge market opportunity in front of us. With this transaction, we will be even better positioned to accelerate our mission and bring innovation to the private markets while delivering value to our shareholders.”

Blythe Masters, Chief Executive of Motive Capital Corp said: “Forge lies at the confluence of several mega trends that are driving value in fintech: electronification and digitization of markets and services, the growth of tech-powered platform businesses, opening architectures in wealth management that are broadening access to new asset classes and rapid expansion of private capital. We found it hard not to love this story.”

The combined company is expected to have a fully diluted equity value on a pro forma basis of approximately $2.0 billion and to deliver approximately $532.5 million of gross proceeds to the combined company prior to the payment of transaction expenses and up to $100 million of cash consideration.

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