Forest Road (NYSE:FRX) stock is taking off on Wednesday after announcing a three-way special purpose acquisition company (SPAC) merger with Beachbody and Myx Fitness.
The SPAC merger between the three companies will have the combined entity operating as The Beachbody Company. This will have it serving as the parent company of Beachbody On Demand, Openfit, and Myx.
When the deal closes, shares of FRX stock will continue to trade on the New York Stock Exchange. However, the ticker won’t be the same. It will be switched over to the BODY ticker for the new company.
The Forest Road SPAC merger values the combined company at $2.9 billion. It will also provide it with gross proceeds of $525 million. That comes from $300 million held in trust by FRX and another $225 million from private investment in public equity (PIPE).
When the deal closes, the current leadership of Beachbody will continue to control the company. They will convert all their stakes over to the new company and will control 84% of it. One change is that Forest Road strategic advisor Kevin Mayer will join the combined company’s Board of Directors.
The deal between the three companies has already been approved by the Boards of each company. Now it just needs approval from shareholders and regulators. So long as there are no complications, the deal is set to close in the second quarter of 2021.
FRX stock was up 4% as of Wednesday morning.
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.