Military veteran-focused Black Rifle Coffee to go public via $1.7 bln SPAC deal

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REUTERS/Larry Downing

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Nov 2 (Reuters) - Black Rifle Coffee Company (BRCC), a coffee seller that focuses on military veterans, said on Tuesday it will go public through a merger with a blank-check acquisition firm in a deal that values the combined company at about $1.7 billion.

The deal with SilverBox Engaged Merger Corp I (SBEA.O) will be financed by up to $345 million of cash held in the trust account of the SPAC and commitments of about $300 million from other investors.

Shares of the SPAC jumped nearly 58% in early trade to a record high of $15.5 on the news.

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The total capital available to Black Rifle at the close of the deal will be up to $545 million, the companies said.

Utah-based Black Rifle, founded in 2014, sells apparel and merchandise, apart from its flagship firearm-themed coffee roast blends.

As part of the deal, BRCC plans to reorganize as a public benefit corporation, meaning that while the company will remain a for-profit enterprise, it will continue to support social good.

BRCC and SBEA together are expected to donate more than 530,000 shares, valued at about $5.3 million, to the company's charitable foundation.

BRCC said its consumer business, which includes both subscription and non-subscription sales, saw a 92% jump in 2020 to $126 million. It also generates sales through wholesale retail from grocery chains such as 7-Eleven, Sam's Club, and Walmart, as well as company-operated and franchised retail coffee shops.

The deal is expected to close during the first quarter of 2022, after which the combined company will be named Black Rifle Coffee Inc.

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Reporting by Manya Saini and Niket Nishant in Bengaluru; Editing by Shailesh Kuber and Shinjini Ganguli

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