Business Context and Reporting Period
K&F Growth Acquisition Corp. II is a Cayman Islands special purpose acquisition company (SPAC) incorporated on July 2, 2024. The company is in the pre-business combination phase, having completed its Initial Public Offering (IPO) on February 6, 2025. This Form 10-Q covers the quarterly period ended June 30, 2025. The company has not yet commenced operations or selected a specific business combination target.
Key Financial Metrics
| Metric | Value (as of/for period ended June 30, 2025) |
|---|---|
| Trust Account Balance | $293,821,865 (Invested in U.S. Treasury Securities) |
| Cash (Outside Trust) | $836,239 |
| Net Income (6 months) | $4,516,531 |
| Net Income (3 months) | $2,914,691 |
| Operating Expenses (6 months) | $367,834 |
| Interest Income (6 months) | $4,884,365 |
| Deferred Underwriting Fee | $10,062,500 |
| Working Capital | $1,018,355 |
| Shares Outstanding | 29,672,727 Class A (Public); 9,583,333 Class B (Founder) |
Material Changes vs. Prior Period
- Initial Public Offering: The most significant change is the consummation of the IPO on February 6, 2025. The company sold 28,750,000 Units (including full over-allotment) at $10.00 per unit, generating gross proceeds of $287,500,000.
- Trust Account Funding: As of December 31, 2024, the Trust Account balance was $0. As of June 30, 2025, $288,937,500 was deposited into the Trust Account, which has grown to $293,821,865 due to interest earnings.
- Private Placement: Simultaneously with the IPO, the company sold 922,727 Private Placement Units to the Sponsor and underwriters for $9,227,270.
- Debt Repayment: The company repaid a related-party promissory note of $266,071 in February 2025. No related-party debt was outstanding as of June 30, 2025.
- Shareholder Deficit: Total Shareholders' Deficit increased from $(38,213) at year-end 2024 to $(9,044,145) at June 30, 2025, primarily due to the accretion of Class A shares to their redemption value.
Outlook, Risks, and Management Commentary
- Completion Window: The company has 21 months from the closing of the IPO (until approximately November 2026) to complete a Business Combination. If unsuccessful, the company will liquidate and redeem public shares.
- Liquidity: Management believes current cash outside the Trust Account ($836,239) is sufficient to meet working capital needs for at least one year. However, additional financing may be required if due diligence costs exceed estimates or if a significant number of shares are redeemed.
- Redemption Price: As of June 30, 2025, the redemption value per public share is approximately $10.22, reflecting the initial $10.00 deposit plus accrued interest.
- Risks: Key risks include the inability to identify a suitable target, market volatility, and the potential for the post-combination share price to fall below the redemption price. The company is an "emerging growth company" and a "shell company."
- Related Party Obligations: The Sponsor pays $25,000 per month for administrative services. The Sponsor has agreed to indemnify the Trust Account against certain third-party claims, though the company has not verified the Sponsor's ability to satisfy this obligation.
Investor Verification Checklist
- Trust Account Composition: Verify that the $293.8M in the Trust Account remains invested in U.S. Treasury Securities or cash as required to maintain SPAC status.
- Redemption Rights: Confirm the specific terms regarding shareholder redemption rights and the 21-month deadline for a Business Combination.
- Deferred Fees: Note the $10.06M deferred underwriting fee payable only upon successful completion of a Business Combination.
- Related Party Transactions: Review the $25,000 monthly administrative fee agreement and the potential for up to $1.5M in convertible working capital loans from the Sponsor.
- Share Structure: Understand the 1/15 share right attached to each unit and the conversion mechanics of Class B founder shares (currently 25% of the post-IPO equity).