Allurion feels the Spac allure

It seems there is no stopping the Spac juggernaut. The latest group to seek to go public via this perilous route is obesity device maker Allurion, and a factor that probably contributed to its willingness is the man behind the blank cheque: Omar Ishrak. Mr Ishrak was until 2020 the chief executive of Medtronic, and will be personally investing in the new company. Whether that means Allurion will go on to be a success is far from guaranteed. The group makes a swallowable gastric balloon, and such technologies have struggled to take off – Allurion’s is not even approved in the US. The advent of effective weight loss drugs like Novo Nordisk’s Wegovy and Lilly’s Mounjaro, which is expected to get the regulatory nod for obesity this year, will make it that much harder. Maybe Boston Scientific’s recent acquisition of another gastric balloon maker, Apollo Endosurgery, emboldened Mr Ishrak's Spac, Compute Health, to choose Allurion. When the deal closes the combined company ought have a pro forma enterprise value of $500m, the groups said. Bearing in mind Spac-merged medtechs’ heinous track record on this measure, investors might want to take that with a pinch of salt.