Company: BACC
Filing Date: 2025-03-26
Form Type: DRS
Source: 0001185185-25-000217
Chunk: 121

Company: Blue Acquisition Corp/Cayman
Filing Date: 2025-03-26
Form: DRS
Chunk 121
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 declines after we complete our initial business combination. Our sponsor may therefore be economically incentivized to complete an initial business combination with a riskier, weaker-performing or less-established target business than would be the case if our sponsor had paid the same per share price for the founder shares as our public shareholders paid for their public shares. The non-managing sponsor investors will share in any appreciation of the founder shares through their membership interests in the sponsor if we successfully complete a business combination. Accordingly, non-managing sponsor investors’ interests in the founder shares owned by them indirectly through their membership interests in the sponsor may provide them with an incentive to vote any public shares they own in favor of a business combination, and make a substantial profit on such interests, even if the business combination is with a target that ultimately declines in value and is not profitable for other public shareholders.

This dilution would increase to the extent that the anti-dilution provisions of the founder shares result in the issuance of Class A ordinary shares on a greater than one-for-one basis upon conversion of the founder shares at the time of our initial business combination and would become exacerbated to the extent that public shareholders seek redemptions from the trust for their public shares. In addition, because of the anti-dilution protection in the founder shares, any equity or equity-linked securities issued in connection with our initial business combination would be disproportionately dilutive to our Class A ordinary shares.

The value of the founder shares following completion of our initial business combination is likely to be substantially higher than the nominal price paid for them, even if the trading price of our ordinary shares at such time is substantially less than $10.05 per public share.

Upon the closing of this offering and assuming no exercise of the over-allotment option, our sponsor, and the non-managing sponsor investors (if any) will have invested in us an aggregate of $4,175,000, comprised of the $25,000 purchase price for the founder shares and the $4,150,000 purchase price for the 415,000 private placement units. Assuming a trading price of $10.05 per public share upon consummation of our initial business combination, the 5,269,500 founder shares would have an aggregate implied value of $52,958,475 and the 415,000 private placement shares would have an aggregate implied value of $4,170,750. Even if the trading price of our ordinary shares were as low as $0.87 per share, and the private placement units are worthless, the