$2.75 Bn Merger of Data Center Company Nidar and Cartica (NASDAQ)

DateJun 26, 2024

Nidar and Cartica Acquisition Corp have signed a definitive Agreement and Plan of Merger, marking a significant business combination in the international data center sector. Cartica Acquisition Corp is a NASDAQ-listed special purpose acquisition company (SPAC). This merger aims to provide Nidar, one of India’s leading data center providers, access to public capital markets, fostering its growth and expansion.

Cartica Acquisition Corp is focused on merging or acquiring businesses in technology, media, and telecommunications. Nidar would stand out in India for its advanced data center services tailored for artificial intelligence (AI) and high-performance computing (HPC).

Offering cutting-edge information technology infrastructure on an As-a-Service model, Nidar caters to a global clientele, including enterprises, governments, startups, small- and medium-sized enterprises, and hyperscalers. Its services encompass colocation, managed services, cloud services, and AI services.

The pre-transaction equity value of Nidar is approximately $2.75 billion, reflecting the substantial growth potential anticipated from this business combination.

Sunil Gupta, CEO and co-founder of Nidar, emphasized the companys leadership in AI and HPC data center services through its Yotta data centers. Yotta designs, builds, and operates Tier III and IV data centers in India, offering both colocation and hyperscale services alongside cloud and managed services. With priority access to industry-leading GPUs through our partnership with a global leader in high-performance computing, combined with the ability to access US capital markets, Yotta is well-positioned to meet the growing demand for cloud infrastructure and AI.

Darshan Hiranandani, co-founder of Nidar and director of Nidar’s largest shareholder, highlighted the management teams proven track record in building and operating top-tier data centers in India. “By merging with Cartica, we enable our team to continue executing our growth strategy, leveraging Yotta’s world-class platform to accelerate growth and create long-term shareholder value,” Hiranandani noted.

Cartica’s CEO, Suresh Guduru, expressed confidence in the strategic partnership with Nidar. “Our collaboration with Nidar underscores our belief in the potential of technology infrastructure, Compute as-a-Service, and India’s pivotal role in the global tech ecosystem. Under Sunil’s leadership, Yotta has positioned itself at the forefront of the global AI movement,” said Guduru.

Merger Agreement

The merger involves a complex series of transactions where a wholly owned subsidiary of Nidar will merge with Cartica, with Cartica surviving as a wholly owned subsidiary of Nidar. Subsequently, Cartica will merge into Nidar, which will become the public entity post-merger. Each Cartica Class A and Class B ordinary share will be converted into a Nidar ordinary share, and each Cartica warrant will be converted into a warrant to purchase a Nidar ordinary share. The merger agreement stipulates that the newly issued Nidar shares and warrants be listed on a major US stock exchange, such as the NYSE or NASDAQ.

Cartica’s trust account, holding approximately $25 million as of April 4, 2024, will be a crucial financial resource for Nidar post-merger. These funds, after addressing any shareholder redemptions and associated costs, will support Nidars business execution and general working capital needs.

The Boards of Directors of both Nidar and Cartica, along with Nidar’s shareholders, have approved the merger agreement. Completion of the merger is contingent upon customary closing conditions, including shareholder approval from Cartica, stock exchange listing approval, and the effectiveness of Nidars registration statement filed with the U.S. Securities and Exchange Commission (SEC).

This merger represents a strategic move to combine Nidars robust data center capabilities with Carticas financial acumen, aiming to capitalize on the burgeoning demand for AI and cloud services.

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