Former NBA star Shaquille O’Neal already has a significant investment portfolio, with holdings that include fast food restaurants, esports and countless endorsement deals.
Now, the former Los Angeles Laker is expanding his business empire by joining several former Walt Disney Co. executives and the eldest son of Martin Luther King Jr. in a new company that has a single purpose — to make acquisitions.
The new company, Forest Road Acquisition Corp., is what’s known as a special purpose acquisition company, or SPAC, a once controversial type of publicly held investment vehicle that has recently come into vogue on Wall Street.
Forest Road has raised $250 million to do deals in the technology, media and telecommunications industries, according to the company’s registration filed with the Securities and Exchange Commission on Thursday. Potential acquisitions could include “audience aggregation platforms,” or streaming services, the company said. Forest Road is also interested in the area of “premium intellectual property.”
The New York-based SPAC, or blank check company, was founded by the Forest Road Co., a financier with offices in New York and Santa Monica that works in sectors such as independent film, real estate and renewable energy. A representative for the company declined to comment, citing its quiet period.
Forest Road Co.’s chief executive, Zachary Tarica, serves as the SPAC’s chairman and chief investment officer. Keith L. Horn, founder and managing member of Loring Capital Advisors, is chief executive of the new entity.
The SPAC’s leadership team includes three former high-level Disney executives: Thomas Staggs, Kevin Mayer and Salil Mehta.
Staggs, who held multiple roles at Disney and eventually became the Burbank entertainment giant’s chief operating officer, is director of the SPAC and chairman of its strategic advisory committee. He was once seen as a probable heir apparent to Disney’s Bob Iger as chief executive, but he left the company in 2016.
Mayer, who will serve as a strategic advisor for the firm, was chairman of Disney’s direct-to-consumer and international segment until he left this year, after also being passed over for Iger’s job. He briefly joined Chinese-owned app TikTok as its chief executive, leaving the growing social media company in August amid President Trump’s looming ban.
Mehta, the SPAC’s chief financial officer, had a long career at Disney and other media companies, most recently serving as Disney’s general manager of digital media and president of FoxNext Games until his exit in April.
O’Neal is listed as a strategic advisor in Forest Road Acquisition Corp.’s registration statement. In SPACs, strategic advisors often serve multiple functions, including putting money into the corporation, identifying acquisition targets and making connections.
A representative for O’Neal said he was unavailable for comment.
The Hall of Fame player, who retired from professional basketball, has a long history of business dealings beyond sports, having invested in Google and Ring before it was sold to Amazon.
His holdings include Auntie Anne’s pretzel shops and Papa John’s Pizza locations, as well as restaurant Big Chicken in Las Vegas. He became a brand ambassador for Papa John’s last year, after the chain’s founder and chief executive — who used a racial epithet during a marketing call — was forced out. O’Neal has also served as a pitch man for Krispy Kreme donuts and Carnival Cruise Line.
O’Neal has said that his investment strategy was inspired by Amazon.com founder Jeff Bezos, who is the world’s wealthiest person.
“I heard Jeff Bezos say one time, he makes his investments based on if it’s going to change people’s lives,” he told the Wall Street Journal in a video interview last year. “Once I started doing that strategy, I think I probably quadrupled what I’m worth.”
Martin Luther King III, who will serve as one of the new investment company’s directors, is a civil rights advocate and co-founded Bounce TV, an African American broadcast network, in 2011.
SPACs, which came to prominence in the 1980s, originally had a bad reputation because of their association with penny stocks and fraud. Since then, their image has been rehabbed, and they’ve become particularly popular recently among companies that want to raise funds without going through a traditional intitial public offering. Companies that have been acquired by SPACs include Boston-based sports betting firm DraftKings Inc., which went public late last year in a $3.3-billion deal.
One streaming company that has mulled merging with a SPAC is Quibi, the startup run by Jeffrey Katzenberg and Meg Whitman, according to people familiar with the matter who were not authorized to comment. Quibi raised $1.75 billion before its launch this year, but has struggled to meet its audience targets amid the pandemic.
(Article written by Ryan Faughnder)