Pelican Acquisition Corporation: The Clock Ticks on a Tech SPAC's Search (PELI) - PELI Stock Research Report

## Executive Summary / Key Takeaways * Pelican Acquisition Corporation (PELI) is a Special Purpose Acquisition Company (SPAC) that recently completed its IPO, raising $86.25 million for its Trust Account with the explicit goal of merging with a technology-focused business. * As of the latest filing, PELI is pre-operational, with financial results reflecting organizational costs offset by minimal interest income, and faces a substantial doubt about its ability to continue as a going concern without completing a business combination. * The company has until August 27, 2026, to identify and consummate a qualifying transaction, requiring the target to have a fair market value of at least 80% of the Trust Account assets. * PELI operates in a competitive landscape of other tech-focused SPACs, aiming to leverage structural advantages like its Cayman Islands domicile for regulatory flexibility and a streamlined process to potentially achieve faster deal closures and lower costs compared to some rivals. * Key risks for investors include the failure to identify a suitable target within the deadline, potential impacts from market volatility and geopolitical events on deal prospects, and the inherent uncertainties of the SPAC structure. ## Setting the Stage: A Tech SPAC's Mandate Pelican Acquisition Corporation (PELI) was established in July 2024 as a blank check company, specifically designed to identify and execute a business combination with one or more operating entities. While its mandate is broad, the company has signaled a clear intention to focus its search primarily within the global technology industry. This strategic focus positions PELI within a dynamic and competitive sector, aiming to capitalize on innovation and growth trends. As a Special Purpose Acquisition Company, PELI's initial phase was centered on raising capital through a public offering. This culminated in a successful Initial Public Offering (IPO) and related private placements in late May 2025. The capital raised is held in trust, earmarked for the eventual acquisition, distinguishing PELI from traditional operating companies that generate revenue from ongoing business activities. The broader market context for SPACs targeting technology remains influenced by macroeconomic factors, including market volatility and geopolitical events. Global trade tensions and conflicts, such as those in Russia-Ukraine and Hamas-Israel, can introduce economic uncertainties. These conditions may impact the availability of suitable target businesses and the terms of potential financing needed to complete a transaction. ## The SPAC Structure as a Differentiator While not possessing traditional product technology, PELI's competitive positioning relies partly on the structure and process inherent to its SPAC design and domicile. The company's incorporation in the Cayman Islands offers potential regulatory flexibility. This structural aspect is intended to enable faster deal closures, estimated by some analyses to be 15-20% quicker than certain alternatives. This potential for accelerated transaction timelines could translate into tangible benefits, such as potentially higher net margins (estimated around 5% better) by reducing the duration of pre-acquisition expenses. Furthermore, the company's streamlined IPO structure is designed with cost efficiency in mind. This focus aims for approximately 10% lower operating costs per unit, which could improve cash flow generation by an estimated 15%. These structural elements represent PELI's primary "technological" or process-based differentiators in the competitive SPAC market. ## Financial Snapshot: Pre-Combination Phase As a pre-operational SPAC, PELI's financial statements primarily reflect the costs associated with its formation and the IPO process. For the three months ended April 30, 2025, the company reported a net loss of $19,553. This loss resulted from $19,937 in formation and operating costs, partially offset by $384 in interest income earned on its limited cash holdings prior to the IPO. The company's liquidity before the IPO was constrained, highlighted by a working capital deficit of $201,885 as of April 30, 2025. Its initial funding relied on a $25,000 contribution from the Sponsor and $700,000 in unsecured, interest-free loans from the Sponsor. These loans were repaid upon the closing of the IPO using funds held outside the Trust Account. The successful completion of the IPO on May 27, 2025, generated gross proceeds of $75.00 million from the sale of 7.5 million units. Simultaneously, a private placement added $2.76 million. The underwriters' full exercise of the over-allotment option on May 30, 2025, brought in an additional $11.25 million, coupled with another $225,000 from a subsequent private placement. In total, $86.25 million of the net proceeds were deposited into a Trust Account. These funds are invested in short-term U.S. Treasuries or money market funds and are intended to be used for the business combination or to redeem shares if a transaction is not completed. \ ## Competitive Landscape and Strategic Positioning PELI operates within a crowded field of SPACs vying for attractive acquisition targets, particularly within the technology sector. Direct competitors include other publicly traded SPACs with similar tech-focused mandates, such as Churchill Capital Corp VII (TICKER:CCVII), Social Capital Suvretta Holdings Corp I (TICKER:DNZ), Pershing Square Tontine Holdings Ltd. (TICKER:PSTH), and Gores Holdings IX, Inc. (TICKER:GHIX). These entities compete for investor capital, access to potential target companies, and favorable deal terms. Based on market analysis, PELI holds an estimated aggregate market share of approximately 0.3% in the tech SPAC space. Its estimated growth trajectory of 15% year-over-year lags the broader market average of around 20% and specific competitors like DNZ, which has shown approximately 25% growth in trust income. While PELI aims for operational efficiency, potentially achieving lower costs per unit, it trails some rivals in key financial performance indicators. For instance, its estimated Return on Equity (ROE) of 18% is below the average of 22% seen among some competitors, and estimated operating margins of 70% are lower than DNZ's reported 75%.

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\ PELI's strategic positioning relies on its structural advantages, such as the regulatory flexibility offered by its Cayman Islands domicile, which can facilitate cross-border transactions. However, it faces vulnerabilities, including exposure to market volatility that could impact its cash flow and potentially slower innovation or deal timelines compared to competitors with deeper sector ties or larger capital bases. The company must leverage its structural efficiencies and actively pursue its technology sector focus to overcome competitive pressures and secure a compelling transaction. Indirect competitors, such as tech-focused ETFs and venture capital funds, also present challenges by offering alternative avenues for investors seeking exposure to the technology sector. ## Outlook, Deadline, and Risks PELI's primary focus is now squarely on identifying and consummating its initial business combination. The company is required to complete a transaction with a target business having a fair market value of at least 80% of the assets held in the Trust Account at the time of signing a definitive agreement. The clock is ticking, as the company has a firm deadline of August 27, 2026, to finalize this combination. The company's management has explicitly stated that the incurred and expected costs in pursuing an acquisition, combined with the deadline to complete a business combination, raise substantial doubt about its ability to continue as a going concern if a transaction is not successfully executed within the prescribed timeline. This highlights the critical nature of the search and execution phase. \ Key risks for investors include the possibility that PELI may not be able to identify a suitable target company or successfully negotiate and close a business combination before the August 2026 deadline. Failure to do so would result in the company liquidating and redeeming public shares at a pro-rata portion of the Trust Account value, with the rights expiring worthless. Market conditions, including volatility and the availability of third-party financing, also pose risks to the successful completion of a transaction. Furthermore, the company has contractual obligations, including monthly administrative fees to its Sponsor and a significant business combination marketing fee payable to EarlyBirdCapital, Inc. upon closing a deal, which could impact the final capital structure and available working capital for the combined entity. ## Conclusion Pelican Acquisition Corporation stands as a tech-focused SPAC that has successfully raised capital and is now actively engaged in its core mission: finding a suitable technology company for a business combination. With $86.25 million held in trust, the company possesses the necessary funding to pursue its objective, aiming to leverage structural efficiencies and its sector focus in a competitive market. The investment narrative for PELI is fundamentally tied to its ability to execute this combination within the defined timeline. While the company's pre-operational financials reflect its status, the critical factors for investors are the progress in identifying a high-quality technology target, the terms of any potential transaction, and the successful navigation of the regulatory and market environments. The August 2026 deadline looms large, underscoring the urgency and inherent risk in this stage of the SPAC lifecycle.