Cartesian Growth Corporation II, a company specializing in blank check offerings, has entered into a material definitive agreement, issuing an unsecured promissory note to its sponsor, CGC II Sponsor LLC. The note, valued at $250,000 and dated July 12, 2024, represents a direct financial obligation for the New York-based company.
The note is non-interest bearing and its principal amount is due on the earlier of two events: the completion of the company's initial business combination or the effective date of the company's winding up.
If a business combination is realized, the sponsor has the option to convert any or all of the principal into warrants, at a rate of one warrant per dollar of the principal amount converted. These "Working Capital Warrants" would carry the same conditions as the private placement warrants issued during the company's initial public offering (IPO) on May 5, 2022.
In case of default, the agreement stipulates that the outstanding balance and any other payable sums will become immediately due. The issuance of the promissory note adheres to the exemption from registration stated in Section 4(a)(2) of the Securities Act of 1933.
Cartesian Growth Corporation II, which falls under the "Blank Checks" industrial classification and operates under the name 05 Real Estate & Construction, has its shares and warrants listed on The Nasdaq Stock Market LLC under the symbols RENEU, RENE, and RENEW, respectively.
In other recent news, Cartesian Growth Corporation II has announced its ninth extension for concluding an initial business combination, now slated for August 10, 2024. This extension, as reported in a recent SEC filing, underscores the company's ongoing endeavors to finalize a business deal within the given timeframe.
On July 3, 2024, Cartesian Growth Corporation II exercised its option to extend the business combination period, drawing $150,000 from an unsecured promissory note.
This note, with a principal amount of up to $1.8 million, was issued in favor of CGC II Sponsor LLC, Cartesian's sponsor, on November 6, 2023. The funds for the extension were deposited into the trust account established during the company's initial public offering. This latest extension is part of twelve possible one-month extensions stipulated in the company's amended and restated memorandum and articles of association.
InvestingPro Insights
Cartesian Growth Corporation II (NASDAQ: RENEU) has made a strategic move with its latest financial arrangement, which aligns with its operational focus and financial health as reflected in current metrics. According to InvestingPro data, the company has a market capitalization of $244.74 million and trades with a P/E ratio of 23.84 based on the last twelve months as of Q1 2024. This valuation comes despite the fact that the company's short-term obligations currently exceed its liquid assets, which is an important consideration for investors monitoring the company's financial resilience.
InvestingPro Tips suggest that Cartesian Growth Corporation II's stock price often moves in the opposite direction of the market, indicating a potential hedge against market downturns. Moreover, while the company is profitable over the last twelve months, it does not pay a dividend to shareholders, which may influence investment decisions based on individual preferences for income-generating assets. For those looking to delve deeper into Cartesian Growth Corporation II's financials and stock performance, there are additional InvestingPro Tips available, which can be accessed with a subscription. Interested readers can use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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