Well that didn’t take long.

Copenhagen based Retail FX and CFDs broker Saxo Bank, and its prospective SPAC partner Disruptive Capital Acquisition Co Ltd, have announced the “termination” of discussions regarding their proposed business combination. Disruptive Capital is a special purpose acquisition company (or “SPAC”) which raised capital on a public exchange for the purpose of taking an existing privately held fintech or financial services business public, via a merger of the SPAC and the existing private company.

Disruptive Capital and Saxo Bank initially announced their intention to pursue a merger less than three months ago, in September 2022. The deal would have brought Saxo Bank public on the Euronext Amsterdam exchange, at a valuation of around €2 billion for Saxo Bank.

The only reason given by the parties for the termination was that, after careful consideration, it was determined that the “timing is not optimal.”

The “timing” reason given is somewhat odd, since if anything the state of the equity markets has improved since mid September, when the initial announcement of the planned transaction was made (e.g. the FTSE 100 is up about 3% since then). We believe a more likely reason was that the deal would have required a significant amount of outside capital to be raised, and that was proving to be very difficult.

The Saxo deal marks the second failed attempt by a Retail FX and CFDs broker to go public via the SPAC route, in just the past six months. After revaluing and renegotiating its planned going-public event over more than 15 months, eToro pulled the plug on its SPAC-IPO deal in July.

Disruptive Capital added that it is now “contemplating its options”, taking into account its business combination deadline of 11 January 2023, subject to a potential extension. The company, listed on Euronext Amsterdam, successfully raised £125 million of proceeds in October 2021. Disruptive Capital is headed by financial services entrepreneur Edi Truell.

Saxo Bank is controlled by China’s Geely Group. Geely bought its original 51% stake in Saxo Bank in 2018 at a valuation for Saxo Bank in the €1.325 billion range, so an exit at €2 billion, if completed, would have represented a healthy profit for Geely on its original investment.