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Highlights
- SoundHound Inc and blank check firm Archimedes Tech SPAC Partners are set to merge their businesses to allow the former’s stock market listing.
- Following the announcement on Tuesday, November 16, Archimedes Tech’s units rose by about two per cent.
- The transaction is expected to bring SoundHound’s valuation at about US$ 2.1 billion.
SoundHound Inc and blank check firm Archimedes Tech SPAC Partners Co (NASDAQ: ATSPU, ATSPU:US) are set to merge their businesses to allow the former’s stock market listing.
Following the announcement on Tuesday, November 16, Archimedes Tech’s units rose by about two per cent to close at a value of US$ 10.2 piece.
Let’s look into SoundHound’s listing plans
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SoundHound SPAC merger details
SoundHound is a voice artificial intelligence (AI) company that developed voice assistant services like Speech-to-Meaning® and Deep Meaning Understanding®.
Its merger deal with the special purpose acquisition company (SPAC) is set to bring in gross proceeds of up to US$ 244 million, which will include US$ 133 million from Archimedes Tech’s trust account.
The remaining US$ 111 million, SoundHound said, will come from a private investment in public equity (PIPE) financing priced at US$ 10 a share.
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The transaction, which is looking at closure in the first quarter of 2022, is expected to bring SoundHound’s valuation at about US$ 2.1 billion.
The Californian firm also said on Tuesday that once the SPAC deal goes through, it plans to rebrand the combined entity as SoundHound AI Inc and begin trading as ‘SOUN’ on the Nasdaq platform.
In the wake of deal’s completion, whatever proceeds is left on Archimedes’ balance sheet after transaction expenses is projected to be used for SoundHound AI’s working capital, growth and other business purposes.
Bottomline
SoundHound’s user base, it says, includes big names like Hyundai, Mercedes-Benz, Pandora, Mastercard, among others. It also noted in its latest release that the voice AI space is expected to grow into a US$ 160 billion market opportunity, which could boost its demand and usage in future.
However, investors should keep in mind that the AI industry is still a young and evolving space, making it subject to volatility.
