(Reuters) – U.S. supply chain management software firm E2open LLC is nearing a deal to go public through a merger with blank-check acquisition company CC Neuberger Principal Holdings I at a valuation of more than $2.5 billion, including debt, people familiar with the matter said on Tuesday.
The sources requested anonymity because the matter is confidential. CC Neuberger declined to comment. E2open and Insight Partners did not immediately respond to requests for comment.
CC Neuberger I shares rose as much as 10.7% on the news but pared gains to close 3.2% higher at $10.53.
CC Neuberger I is a special purpose acquisition (SPAC), or shell, company that uses proceeds from an initial public offering to acquire a private company, which then becomes public as a result.
Merging with a SPAC has become a popular alternative to going public in a traditional initial public offering, as it involves less regulatory scrutiny and more certainty over the market valuation and funds raised.
So far this year, sports betting platform DraftKings Inc and electric commercial truck maker Nikola Corp have gone public by merging with a SPAC.
Insight Partners took E2open private in 2015 in a roughly $273 million deal. The Austin, Texas-based company sells software that allows companies to manage their supply chain.
Led by veteran Wall Street dealmaker Chinh Chu’s investment firm, CC Neuberger I raised $414 million in an IPO in April with the aim of buying a company in the financial, technology and business services sectors.
CC Neuberger I has also lined up more than $500 million in additional funding for the E2open deal through a private investment in public equity (PIPE) with institutional investors, one of the sources said.
Chu’s CC Capital in the last five years has raised several SPACs, acquiring the likes of potato-chip maker Utz Brands Inc and U.S. annuities and life insurer Fidelity & Guaranty. CC Capital also took U.S. business analytics firm Dun & Bradstreet Holdings Inc public through an IPO in June.