Jam City ends SPAC deal that would have made US$1.2b firm

[NEW YORK] Mobile entertainment company Jam City has called off its plan to go public through a combination with a blank-check firm that would have valued the combined company at US$1.2 billion.

Jam City and special purpose acquisition company DPCM Capital said in a joint statement Friday that they were terminating their merger agreement because of current market conditions. DPCM Capital will evaluate merger targets, according to the statement.

As part of that transaction, Jam City had planned to acquire Montreal-based game publisher Ludia, Jam City and DPCM Capital said in May when they announced their agreement. Ludia, which makes games based on the "Jurassic World" movies, was valued at US$175 million in the takeover, the companies said.

"We've proven our ability to acquire new companies and we've proven our ability to build great mobile entertainment experiences in-house," Jam City chief executive officer Chris DeWolfe said in an interview at the time.

"We want to fuel that growth - we need more capital to do that, and we need a public currency to do that."

Like virtually all its peers, the developer behind mobile games such as Cookie Jam and Disney Pop Town benefited from the home-entertainment surge during the coronavirus pandemic. Shares of gaming platform Roblox Corp have climbed 27 per cent from the opening trades when it went public in a direct listing in March.

Jam City was started in 2010 by DeWolfe, a MySpace co-founder as well as its former CEO. Culver City, California-based Jam City has a multiyear game development agreement with Walt Disney Co, along with its in-house offerings.

DPCM is led by chairman and CEO Emil Michael, a former senior vice president of business for Uber Technologies. The Miami-based company raised US$300 million in its October IPO.

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