UPDATE: Dec. 10, 2021: Boxed made its debut on the New York Stock Exchange on Thursday under the new ticker symbols "BOXD" and "BOXD WS," according to announcements from the online wholesaler and Seven Oaks Acquisition Corp., a publicly traded special purpose acquisition company. Shares for BOXD started trading at $8.90, according to Yahoo Finance.
The SPAC transaction, which combined the companies, received approval from Seven Oaks shareholders at a meeting on Tuesday and also approval from Boxed shareholders. With the deal, Boxed will be able to raise roughly $198 million in gross cash proceeds from Seven Oaks’ cash in trust of approximately $78 million and $120 million fully committed private placement financing, Seven Oaks said, noting that no secondary shares were sold by existing Boxed shareholders.
“We are eager to use this additional capital to fuel the growth of our B2C and B2B platforms where we plan to drive customer acquisition, further enhance our loyalty programs, thoughtfully expand our product assortment, continue to help the world stock up through our breakthrough technology, and importantly, invest in our high margin Software and Services business," Boxed CEO Chieh Huang, who will continue lead the combined company, said in a statement.
Separately, Seven Oaks announced on Thursday that Boxed will use Google Cloud's advanced cloud computing, data analytics and artificial intelligence technologies to enhance the wholesaler's operational capabilities, add more value to its enterprise clients and find new customers for its Software & Services clients.
- Boxed, the online seller of bulk-sized toilet paper, cereal and other goods, has entered into an agreement with Seven Oaks Acquisition Corp., a publicly traded special purpose acquisition company (SPAC), according to an announcement on Monday.
- Through the deal, which values Boxed at roughly $900 million, Boxed will go public in the U.S. under its current name and receive $334 million in net cash. The new company will be led by Boxed’s existing CEO Chieh Huang while Gary Matthews, Seven Oak’s chairman and CEO, serve as board chairman.
- The deal is expected to be completed by the end of the fourth quarter of 2021, according to the press release.
Founded in 2013, Boxed has brought the bulk-buying model online for consumers and businesses. With the pandemic accelerating online grocery's growth in the U.S., the company has seen its average order value reach roughly $100, according to Monday's announcement.
In addition to groceries, the online retailer offers staple goods like household, personal care and health and wellness items along with office supplies and pet products. Early this year, Boxed partnered with Aeon, one of Asia's largest retailers, to expand overseas with a multi-year software-as-a-service (SaaS) deal that monetizes the online grocer’s proprietary end-to-end technology. Aeon invested $111 million in Boxed in 2018.
Through the merger with Seven Oaks, Boxed is poised for further growth as a publicly traded firm. In an interview with The Wall Street Journal, Huang said Boxed is not profitable, but that it sees an opportunity to license its in-house technology to other companies. Its digital advertising, delivery operations and sales to business clients are also opportunities for future growth, he said.
Boxed, which offers around 2,000 products on its site, recently launched a digital marketplace for third-party sellers that has helped boost its average basket size, Huang said during an industry presentation earlier this year.
“This transaction will allow Boxed to capitalize on the tailwinds that e-commerce businesses are experiencing,” Huang said in a statement. “This capital will also allow us to fund B2B growth, third-party marketplace expansion and drive our unique SaaS business.”
Both companies’ board of directors have approved the transaction, which now awaits stockholder approval. Boxed previously deflected acquisition offers from Kroger and Amazon, according to reports.
Like many online grocers, Boxed's sales shot up during the pandemic. As consumers increasingly return to stores, however, those companies are looking to new avenues for growth. Online meat seller ButcherBox, for one, now lists its products on Instacart's marketplace.
For the deal, Boxed has Citi and PJ Solomon as financial advisors, BTIG as a capital markets advisor and Latham & Watkins as legal counsel.