Appgate intends to go public by merging with Newtown Lane Marketing.
The deal was made public on Tuesday. Under the terms of the agreement, Appgate will become a public company "with significant financial resources to accelerate growth, scale, and go-to-market strategies," the firm says.
The definitive merger agreement could value the combined company at up to $1 billion.
Under the terms of the deal, Appgate received $50 million once the merger agreement was signed and will be given a further $25 million at closing, as well as another $25 million package moving forward.
Miami-based Appgate, a spin-off of Cyxtera Technologies and provider of zero-trust security solutions, accounts for roughly 650 government and enterprise clients.
The company says it intends to up-list on the "Nasdaq or NYSE as soon as possible" and as soon as the merger is complete and its application has been accepted -- potentially as quickly as Q2 2021.
Existing investors, including BC Partners and Medina Capital, will retain their share equity in the combined company for at least one year after closing as majority shareholders.
"This is a tremendous time of growth in our industry," commented Barry Field, Appgate CEO. "Appgate is displacing outdated, easily compromised, traditional network security, such as VPNs and firewalls, by using cutting-edge software designed around the principles of zero trust."
At the same time as the merger announcement, Appgate said that an investment manager, currently unnamed, has agreed to provide up to $100 million in convertible notes once the firm hits a $1 billion valuation.
Appgate projects revenues of approximately $40 million in the 2021 financial year.
According to research by Sijoitusrahastot, Special Purpose Acquisition Companies (SPACs) in the United States -- used to speed up the typical Initial Public Offering (IPO) process -- raised over $83 billion in 2020, a higher number than in the past 10 years combined.
In total, 248 US-based SPACs raised $83.04 billion last year, with the market share of US-listed SPACs rising from 23% in 2019 to 53% in 2020. In total, 90% of SPAC deals made in 2020 completed.
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