An Analysis Of The Yatra-Terrapin Reverse Merger And Cross-Border Spac Transactions
- IJLLR Journal
- 2 days ago
- 1 min read
Suhani Skumar, O.P. Jindal Global University
Introduction
The reverse merger of Yatra Online, an online travel firm, and Terrapin 3 Acquisition Corporation, an American Special Purpose Acquisition Company (SPAC), is a leading case for cross-border mergers that depicts private Indian companies using externalization strategies to access global capital markets. The essay below addresses the legal and regulatory aspects of such complex mergers and how SPACs serve as a ‘shortcut’ and a ‘back door’ to the traditional initial public offering (IPO) process. This essay analyzes the merger and provides recommendations for India and SPACs.
Transaction and Merger Structure
The Yatra-Terrapin transaction had a planned two-step merger process. First, Terrapin Merger Sub was merged with TRTL, where TRTL continued as a partially owned subsidiary of Terrapin Parent. Then, Terrapin Parent was merged into Yatra, so Yatra became the surviving entity, and TRTL as a partially owned subsidiary. Yatra achieved a public listing on the NASDAQ bound to address the regulatory requirements of both India and the US.
The transaction was valued at $218 million on Yatra along with a $20 million Private Investment in Public Equity (PIPE) financing (initially intended to be $40 million), secured through a Forward Purchase Contract with Macquarie Sponsor (MIHI LLC). This value determines the ownership stake of existing Yatra and SPAC’s stockholders. The PIPE investment played a critical role in meeting the minimum cash conditions and financial viability of the merger to be completed.
