Minneapolis-based biotech startup Foxo Technologies went public Friday morning after completing its merger with Texas-based Delwinds Insurance Acquisition Corp.
Minneapolis-based Foxo Technologies completes SPAC merger, goes public
The biotech company is the first Minnesota company to go public this year.
September 16, 2022 at 4:35PM
Foxo started trading under the ticker symbol FOXO, marking the first public debut for a Minnesota company this year.
Delwinds is a special purpose acquisition company (SPAC), a blank check firm created solely to a acquire or merge with an active business.
There have been far fewer new public listings in 2022 relative to last year due to the unsettled economic environment.
The number of initial public offerings, or IPOs, is down 78.6% this year compared to the same time a year ago, according to Connecticut-based Renaissance Capital.
The market for biotech companies has been particularly challenging.
"Overall, the market is in rough shape, and it has been incredibly difficult for biotech and growth companies," Foxo CEO Jon Sabes said in an email. "That said, we are confident that the future of mortality prediction, along with health and wellness assessment, resides in molecular biomarkers."
The stock opened at $9.15 per share on Friday. It closed at $4.05 per share, down 56%, for the day. Markets were down broadly Friday.
Foxo's main product is a saliva test used to gather epigenetic and biological aging information. That "longevity research" material can be sold to life insurance companies that are underwriting policies.
Delwinds shareholders approved the business combination in a vote Wednesday. A total of 91% of shareholders voted in favor.
Foxo and Houston-based Delwinds announced plans for the merger in February. At the time, the companies indicated the transaction was expected to close in the second quarter.
SPACs do not have business operations but raise millions through initial public offerings. The SPAC then acquires or merges with a private, existing company. Through that process, the target company becomes public. It typically offers a faster route for a company going public than a traditional IPO.
"This is a challenging market environment for any company to navigate, so while it has taken a bit longer than anticipated to swim through unpredictable seas, we have gotten where we need to be and are thrilled to be in business," Sabes said in an email.
Eight Minnesota companies went public through traditional IPOs last year, the state's busiest year in more than two decades.
Balaton, Minn.-based Tru Shrimp filed for an IPO in January, but the indoor shrimp farmer postponed its plan a month later citing adverse market conditions.
The funding is expected to give more than 5,000 Minnesotans, especially in rural areas, high-speed broadband access across the state and help at least 139 businesses and 368 farms.
