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Another SPAC merger bites the dust: Redbox owner Chicken Soup for the Soul filed for bankruptcy on Jun 30, 2024 and reportedly owes nearly $1 billion to debtors.

The following week, a bankruptcy court judgeΒ ruled that $CSSE will be liquidated, after the company & lenders accused its former CEO of mismanagement. The company was unable to secure $8M in emergency financing to pay its ~1,000 employees

Two years after SPAC mania hit its peak, many once-popular companies like Fisker and now Redbox, have come crashing down:

Redbox went public via SPAC merger in 2021 that promised $145M in cash + $50M in PIPE funding and valued the company at $693M (see the deck they used below). At the time, private equity firm Apollo Global held a 59% stake in Redbox.

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Like most SPAC decks, Redbox’s projections were sky high: expecting over $1B in revenue by 2023. Due to poor financials, Redbox stock sunk from $10 in October 2021 to under $2 and was delisted on June 30, 2022.

Chicken Soup for the Soul Entertainment, Inc. ($CSSE) came to the rescue with a $375M acquisition deal (an 88% discount on the IPO price). To finance the sale, Chicken Soup took on $325M in debt and has since been sued over a dozen times over unpaid bills.

$CSSE stock (2023 - 2024)

Yesterday (precisely two years after the Redbox SPAC was delisted), Chicken Soup for the Soul Entertainment filed for bankruptcy.

According to the bankruptcy filing, Chicken Soup owed $970 million altogether to Redbox partners including Walmart, Walgreens, and major studios like Universal, Sony, Lionsgate and Warner Bros.

Redbox reportedly hasn’t paid employees for a week, and medical benefits have been suspended.

Since 2002, Redbox has grown to 34,000 locations across the US and rented over 1 billion discs to consumers. Due to the Chicken Soup for Soul bankruptcy and liquidation, Redbox has ceased operations after 22 years.

See the full 39-slide Redbox SPAC deck from 2021 here, where you can explore several other SPAC pitch decks.