Dog treats subscription service BarkBox to go public via a $1.6 billion SPAC merger

• BarkBox, a subscription service for pet owners, is going public via a merger with a special acquisition corporation (SPAC), the company announced Thursday.
• The deal is the latest in a string of SPAC-backed IPOs over the last year.
• BarkBox will merge with the blank-check company Northern Star Acquisitions Corp. in a $1.6 billion deal, including debt, according to the announcement.
• Once the deal closes, Northern Star Acquisitions Corp. will list under a new ticker, BARK, on the New York Stock Exchange.
• Since the outbreak of the pandemic, quarantining Americans have turned to furry friends for comfort. Pet adoptions and related spending has soared.

BarkBox, a subscription service for dog treats and toys, will go public via a merger with a blank check company, the company announced on Thursday. The deal is valued at $1.6 billion, including debts, according to the announcement.

When the deal closes, Northern Star Acquisitions Corp. - the blank-check company merging with BarkBox - expects up to $454 million in gross cash proceeds.

BarkBox will list on the New York Stock exchange with the ticker "BARK." The company projects that it will make $365 million in revenue by the end of the fiscal year.

The move comes amid an uptick in pet adoption. Americans have turned to furry friends to keep them company in quarantine, and pet-supply companies like BarkBox and Petco, which filed to go public in November, are cashing in. Petco saw sales increase nearly 10% since last year, CNBC reported.

Read more: These 10 companies are the fastest-growing DTC pet care brands by website traffic. They're going up against Nestle's Purina and Mars's Royal Canin a piece of the nearly $100 billion pet product market.

Over the past year, SPACs have become increasingly popular vehicle for investment. In 2020, SPACs have raised more than $40 billion in investment, nearly triple last year's numbers, Business Insider previously reported.

The deal is backed by North Star Fidelity Management & Research Company LLC, Senator Investment Group, the Federated Hermes Kaufmann Funds, and "other top-tier institutional investors" including affiliates of the Santo Domingo Group.

BarkBox was founded in 2012. Over the years the company has expanded from its original direct-to-consumer subscription box filled with dog treats and toys to a national pet goods brand, carried at major retailers like Target, Petco, PetSmart, and Costco. The service has 1 million monthly subscribers, according to the company.