Dive Brief:
- A blank-check entity formed by biotechnology investor Cormorant Asset Management has raised $150 million in an initial public offering meant to support a future merger with a privately held company.
- The special purpose acquisition company or “SPAC,” called Helix Acquisition Corp. III, sold 15 million shares at $10 apiece, some 2.5 million more shares than it had previously projected. It began trading on the Nasdaq stock exchange Friday under the ticker symbol “HLXC.” Helix doesn’t have a merger target just yet, nor has it engaged in any related talks. But it does intend to focus on “healthcare or healthcare-related industries,” according to its prospectus.
- With more than $2.4 billion under management as of Sept. 30, Cormorant is one of the biotech sector’s prominent “crossover” investors that backs private as well as publicly traded drug companies. The firm has now taken three SPACs public since 2022, and found merger partners — Moonlake Immunotherapeutics and BridgeBio Oncology Therapeutics — for the previous two.
Dive Insight:
In SPAC deals, a publicly traded investment vehicle buys or combines with a private company, giving the startup an easier way to go public than via a traditional new stock issuance and allowing its investors to keep a larger stake than they otherwise would.
SPACs skyrocketed in 2020 but fell out of favor over the next few years due to disappointing returns and increased federal oversight. They rebounded in 2025, though, giving investors an alternative path to Wall Street in a year with little IPO activity.
In a recent report, IPO research firm Renaissance Capital noted that new SPAC issuances more than doubled from 2024 to 2025 in a “positive sign” for the market. Some published reports suggest the rebound was driven by a return of experienced SPAC sponsors with past successes.
Cormorant is among those making that kind of pitch. In its prospectus, Helix noted how over 50 of Cormorant’s portfolio companies have completed IPOs, among them biotechs that were later acquired like Prometheus Biosciences and MyoKardia. The firm’s two previous SPAC targets, Moonlake and BridgeBio Oncology, have also built value since their mergers.
Helix detailed how its backers were able to complete the BridgeBio Oncology deal “even in a difficult market environment” and that there remain many other candidates to pursue. The “underlying pace of scientific innovation” combined with a challenging funding environment for private and public drugmakers has created a “unique and attractive” opportunity to find new merger targets. Many drug startups have stayed private for longer during the market tumult, leading to a backlog of mature companies that haven’t yet made it to Wall Street.
The current climate “not only creates good hunting grounds for Helix III, but also augments the unique value proposition a [SPAC] offers,” it said in its IPO prospectus. “An alternative path to the public markets and a defined investor base” is “exceptionally compelling in our environment today.”
