Struggling SPAC Seeks to Acquire iRocket for $400M After Returning Most of Its Capital

A startup focused on small satellite launches that has yet to prove itself is joining forces with an almost depleted SPAC trust to embark on an extraordinary journey: going public in a deal valued at approximately $400 million.

Innovative Rocket Technologies Inc. (iRocket) has teamed up with BPGC Acquisition Corp., a SPAC founded by former Commerce Secretary Wilbur Ross, with intentions to close the deal in the fourth quarter of this year.

Notably, this SPAC has nearly exhausted its funds after raising $345 million during its IPO in March 2021. A September 2024 filing with the U.S. Securities and Exchange Commission revealed that most of the capital had been returned to shareholders due to the SPAC’s failure to find an acquisition target by the deadline, leaving just $30.5 million in trust.

Just 16 days later, the firm announced in an 8-K report that an additional $28.8 million had been redeemed, resulting in a trust balance that represents a mere 0.5% of its original amount, approximately $1.6 million. Remaining shareholders, primarily the SPAC’s sponsors, opted to extend the deadline to find a target until March 2026.

Once generating significant interest, iRocket is backed by venture capital firm Village Global, featuring prominent billionaires like Bill Gates, Eric Schmidt, and Reid Hoffman among its partners.

Nonetheless, iRocket is an unusual choice for a public listing. According to PitchBook, the company has raised only a few million in venture funding within a capital-intensive sector. Since its founding in 2018, it has not conducted a single test flight of its Shockwave launch vehicle. During this time, competitors like Stoke Space and Firefly have gained considerable advantages in funding and technology readiness.

The industry landscape has evolved: As of 2023, iRocket touts the Shockwave as capable of carrying payloads ranging from 300 kg to 1,500 kg, amidst a competitive field featuring vehicles like Firefly’s Alpha and Rocket Lab’s Electron, both of which have successfully launched customer payloads. If iRocket can fulfill its ambitious value proposition—characterized by full reusability, rapid refurbishment, and 24-hour responsiveness—it may become a strong player, though achieving these goals is a significant challenge.

The New York-based startup currently lists only four employees on LinkedIn, not including board members. Its contracts include a significant $18 million deal with the Air Force Research Lab and a $1.8 million contract with the Space Force. A public relations firm representing both iRocket and the SPAC did not respond to TechCrunch’s inquiries.

The history of this special purpose acquisition vehicle has been eventful. Previously known as Ross Acquisition Corp II, it aimed to take public biopharma company Aprinoia Therapeutics in January 2023 but canceled the deal eight months later. Following this unsuccessful transaction, the NYSE initiated delisting proceedings against the SPAC in March.

RAC II has since rebranded as BPGC Acquisition Corp. and now has until March 2026 to finalize a deal.

Considering the SPAC’s limited cash reserves, if iRocket’s current shareholders wish to obtain meaningful cash for their equity, both parties must secure substantial funding from private equity investors through a PIPE (private investment in public equity) round.