Weather-tech startup Tomorrow.io on Monday called off its plan to become publicly traded by merging with a special purpose acquisition company.
The Boston startup, which offers precision weather forecasts and plans to launch its own network of radar satellites, said it could no longer complete the merger with Pine Technology Acquisition Corp. due to “market conditions.”
Chief executive Shimon Elkabetz said completing the planned deal had become too risky.
“Pine Technology has been and continues to be a tremendous partner,” Elkabetz wrote in a post on LinkedIn. “In the recent months during our SPAC process, however, it became apparent through both our strategic initiatives and overall market conditions, that the best choice for the company and its expansive growth is to remain private for now.”
The startup’s business remains strong and it isn’t altering its plans for growth, he added.
The stock market has plummeted this year, amid the Russian invasion of Ukraine, higher inflation, and expectations that the Federal Reserve will raise interest rates soon. The Nasdaq Composite Index is down 18 percent this year, and stocks of local tech companies have fallen even more. Wayfair has lost 34 percent, HubSpot has lost 37 percent, and Toast is off 50 percent. And companies that completed SPAC deals have been hit hardest of all. (For example, Boston biotech Gelesis is down 67 percent this year.)
Tomorrow.io announced in December its plan to combine with special purpose acquisition company Pine Technology. The deal was to raise $420 million in backing for the weather company, which would be valued at $1.2 billion. Instead, Tomorrow.io will remain private and will pay Pine Technology a $1.5 million cancellation fee.