Argo Capital Acquisition Corp. has filed a Form 10-K for the fiscal year ended December 31, 2023, reporting an aggregate market value of $52,829,219 for its shares of common stock held by non-affiliates. As of May 9, 2024, the company had 1,762,409 shares of Class A Common Stock and 2,587,500 shares of Class B Common Stock issued and outstanding.
Overview
Arogo Capital Corp. is a blank check company formed in June 2021 to acquire or merge with another company. The company raised $103.5 million in an IPO in December 2021 by selling 10.35 million units at $10 per unit. It also raised an additional $4.7 million in a private placement. The cash is held in a trust account to use for the future acquisition.
As of December 31, 2023, Arogo has not yet completed an acquisition or conducted any operations other than formation activities and the IPO. It has earned interest income on the cash held in trust and incurred some operating expenses.
Results
Year | Net Income/(Loss) | Main Components |
---|---|---|
2023 | $1.46 million | $3.1 million interest income, $1.2 million expenses |
2022 | ($0.73 million) | $1.1 million interest income, $1.5 million expenses |
The higher net income in 2023 was primarily due to higher interest rates driving increased interest income. Operating expenses were similar in both years.
Business Combination Attempt
In April 2022, Arogo announced a merger agreement with Eon Reality Inc. However, in November 2023 Arogo terminated the agreement due to breaches by Eon Reality. Arogo continues to search for an acquisition target before the December 2024 deadline.
Trust Account
As of December 31, 2023, Arogo held $19.2 million in a trust account, invested in U.S. Treasury securities. These funds can be used to complete an acquisition or redeem shares.
During 2023, some shareholders redeemed $54.7 million worth of shares after a deadline extension vote. In September 2023, additional redemptions of $35.4 million occurred after another extension. Currently 1.76 million public shares remain outstanding.
Liquidity
Arogo has sufficient cash in trust to operate until the December 2024 deadline to complete an acquisition or liquidate. It has received extensions from shareholders in exchange for the sponsor depositing additional cash in trust.
As of December 31, 2023 Arogo held:
If an acquisition is not completed by the deadline, Arogo will liquidate and return funds to shareholders. This mandatory liquidation requirement raises doubt about Arogo’s ability operate as a going concern past December 2024.
Critical Policies
Arogo’s most critical accounting policies relate to using estimates and assumptions that affect the valuation of assets and shares. Key estimates include:
Conclusion
Arogo Capital Corp continues to search for a business to acquire, with sufficient funds held in trust for an acquisition. However, the company has limited time remaining before the liquidation deadline in December 2024. If an acquisition is not completed by then, the company will likely cease operations and dissolve.