The power of celebrity in sports and entertainment is the target of a new blank-check company formed by a slate of Hollywood power brokers including Peter Guber, head of Mandalay Entertainment and limited partner in the Golden State Warriors and L.A. Dodgers and Michael Mahan, vice-chair of Dick Clark Productions and part owner of a number of sports teams.
Bright Lights Acquisition Corp filed Friday night to raise $200 million in an initial public offering. Their goal is to identify “companies operating in the consumer products and media, entertainment and sports sectors with enterprise valuations in the range of $500 million to $1.5 billion. We are emphasizing (but not limiting ourselves to) businesses that can benefit from celebrity ownership and/or partnership.” Special purpose acquisition companies like Bright Lights go public with the goal of finding an operating business to take public.
True to its celebrity-focus, Grammy winning singer-songwriter Ciara Wilson will serve on the broad of directors. Her husband, Seattle Seahawks quarterback Russell Wilson, isn’t listed in the filing, though several other big media names are involved. They include co-chairman Allen Shapiro, who engineered a leveraged buyout of Dick Clark Productions and headed it for a time. He will be joined in the leadership role by John Howard, an experienced banker who heads Irving Place Capital, formerly an arm of Bear Stearns.
Shapiro and Howard this year formed Celebrands, a company that seeks to be an early backer of celebrity-driven consumer products. Ryan Reynolds’ Aviation Gin, which the pair invested in, is one example of the new wave of celebrity brand building magic Bright Lights seeks to capture. Aviation was sold to drinks giant Diageo in August as part of $610 million deal.
Mark Shapiro, the president of Endeavor, the artist representation firm that grew out of William Morris, will also serve on the Bright Lights board. Shapiro also served as an executive at ESPN and led the parent of theme park Six Flags. He currently sits on the board of Live Nation, Captivate Network and Equity Residential, a large publicly traded landlord.
Selena Kalvaria, who is the chief marketing officer at luggage maker Away and former brand manager at Anheuser Busch, is joining Bright Lights as a director. Hahn Lee, who was a top executive at News Corp’s Realtor.com, is chief financial officer.
Like all SPACs, much of the appeal to investors is a promise that the executives’ experience and connections will unearth a growth company. In Bright Lights’ case, the sponsors’ access and proximity to celebrities is presented as a primary selling point in the prospectus. “[O]ur executive team has become trusted partners to owners, operators and celebrities. We believe our unique network of relationships and extensive experience sourcing and executing transactions will enhance our ability to complete a successful business combination.”
In addition to Reynolds’ gin, the SPAC cites examples of Oprah Winfrey’s role as an investor in Weight Watchers, Dr Dre’s Beats brand and Shaquille O’Neal’s time as a director of Papa John’s pizza as situations where celebrities have had a positive effect on business performance. O’Neal, who served as a Papa John’s director concurrently with Mark Shaprio, isn’t involved in this venture – he has his own SPAC.
While much of Bright Lights’ proposition revolves around Hollywood celebrity, the executives do have extensive experience in the sports business world. Guber, who will be accompany director, also owns part of the L.A. Major League Soccer franchise and Team Liquid, an esports team, in addition to stakes of the Warriors and Dodgers. Mahan owns the Oklahoma City Dodgers, a minor league baseball team, and parts of the same soccer and esports teams as Guber. Mahan also owns part of Epic Games, maker of Fortnite and other video games.
SPACs have been one of the hottest topics in the investment world this year, serving as a personality-driven alternative to traditional IPOs. Just yesterday, a dozen new SPACs, including Bright Lights, filed for IPOs with the Securities and Exchange Commission, bringing the number of new SPACs to about 200 in 2020. Including Bright Lights, more than three-dozen sports-related SPACs have been formed since this spring.
Once its IPO prices, Bright Lights will have 24 months to make an acquisition or it will have to return its IPO capital back to investors. Jefferies and Moelis are joint bookrunners, the banks that will bring the SPAC public.