Filing Overview
Registrant: CF Acquisition Corp. VI (Nasdaq: CFVI, CFVIU, CFVIW), in connection with its proposed business combination with Rumble Inc. The Form 8-K was filed December 2, 2021, reporting events dated December 1, 2021. This is a transaction announcement, not an operating or quarterly results filing.
Business Context and Transaction
CF VI and Rumble entered into a Business Combination Agreement pursuant to an Ontario court-approved arrangement. At closing, Rumble shareholders are expected to receive CF VI Class A common stock or exchangeable shares, depending on shareholder status.
- The arrangement consideration is defined as $3.15 billion plus Rumble’s closing cash and cash equivalents, net of debt, plus the aggregate exercise price of outstanding Rumble options.
- The implied price per Rumble share will be based on the arrangement consideration divided by Rumble’s fully diluted share count.
- Rumble options and warrants will be exchanged for securities tied to CF VI Class A common stock, subject to specified exchange ratios and earnout mechanics.
- CF VI expects to issue Class D non-economic, multiple-vote shares to Rumble founder and CEO Christopher Pavlovski for $1.0 million, resulting in approximately 85% of CF VI’s fully diluted voting power at closing, taking into account his other holdings.
Financing, Capital Structure and Liquidity
- CF VI entered into subscription agreements for 8.5 million Class A shares at $10.00 per share, representing gross PIPE proceeds of $85.0 million. The Sponsor may provide up to $7.59 million of this amount.
- The PIPE closing is contingent on the substantially concurrent closing of the business combination.
- Rumble’s obligation to close requires available cash of at least $125.0 million, subject to the agreement’s definitions and conditions.
- CF VI must have at least $5.000001 million of net tangible assets at closing after redemptions and PIPE investments.
- CF VI agreed to repurchase 1.1 million ExchangeCo shares from Mr. Pavlovski and redeem corresponding Class C shares for $11.0 million immediately after closing.
- The filing does not provide current revenue, net income, operating cash flow, cash balance, debt balance, liquidity balance, or margin data for Rumble or CF VI.
Material Changes and Unusual Items
- The transaction would create a new public-company structure with Class A economic shares, Class C voting but non-economic shares, and Class D multiple-vote, non-economic shares.
- Up to 105 million shares, adjusted by the arrangement consideration, may be placed in escrow for five years and released in two tranches when the Class A stock price reaches $15.00 and $17.50 targets for specified trading periods.
- Specified Rumble shareholders will be subject to lock-up restrictions generally ending on the earliest of one year after closing, achievement of a $15.00 trading-price condition, or certain change-of-control transactions.
- Rumble shareholders party to the support agreement collectively hold sufficient votes to approve the arrangement, according to the filing.
- No termination fee or expense reimbursement is required if the BCA is terminated, although parties remain liable for willful and material breaches.
Conditions, Outlook and Risks
Closing remains subject to CF VI and Rumble shareholder approvals, Ontario court orders, regulatory approvals, effectiveness of a Form S-4 registration statement, applicable stock-exchange listing approval, minimum cash and net tangible asset conditions, and other customary conditions. The BCA may generally be terminated by mutual consent, for specified breaches, failure to obtain required approvals, certain recommendation changes, or failure to close within 270 days, subject to a potential 60-day extension.
The filing provides no formal operating guidance or financial forecast. Management’s forward-looking statements are subject to risks including failure to close, insufficient trust-account proceeds after redemptions, inability to complete the PIPE, litigation, listing risks, transaction costs, uncertain projected financial information, Rumble’s limited operating history, potential inability to achieve profitability or generate cash, competition, regulation, retention of users and content providers, growth execution, intellectual-property matters, personnel needs, and COVID-19-related economic uncertainty.
Investor Verification Checklist
- Verify the final arrangement consideration, Rumble fully diluted share count, exchange ratios, and resulting ownership percentages in the Form S-4 and proxy statement.
- Confirm Rumble’s historical and projected revenue, profitability, cash flow, cash balance, debt, margins, and liquidity; these figures are not provided clearly in this Form 8-K.
- Assess actual CF VI trust-account proceeds after shareholder redemptions and whether available cash exceeds the $125.0 million condition.
- Review the economic and voting impact of the Class C and Class D shares, including Mr. Pavlovski’s stated 85% voting power.
- Evaluate dilution from the PIPE shares, exchanged options and warrants, escrowed shares, earnout shares, and the $11.0 million share repurchase.
- Confirm shareholder, court, regulatory, registration-statement, and exchange-listing approvals and the expected closing timeline.