Connect with us

Hi, what are you looking for?

Investing

Special purpose acquisition companies fall out of favour with investors

Branson Spac

After an wave of special purpose acquisition companies, known as Spacs, the tide appears to be turning, with some of the highest-profile examples now under pressure

Spacs — or blank-cheque funds — are shell companies that raise money via initial public offerings before listing on a stock exchange. Then they search for an acquisition, typically a private company. Once a deal is finalised, the Spac takes its target public by absorbing it and its investors take a slice of the new company. If no deal is done, the fund is liquidated and investors are refunded.

Two months ago shares in Sir Richard Branson’s VG Acquisition Corp surged to $17.65 when it announced its merger with 23andme, a genetic testing firm. It has since fallen by 42 per cent to $10.20.

Shares in Churchill Capital Corp IV have halved since its combination with Lucid Motors, an electric carmaker, was announced on February 22. In the weeks since FinTech Acquisition Corp confirmed its deal with eToro, the trading platform, its shares have dropped by more than a quarter.

The chairman of one Spac described the market as “way overcrowded”, bemoaning the role of “jam tomorrow-type companies” in the glut. “I thought last year was the peak,” he said. “Now in a few months it’s been beaten.”

There are 553 active Spacs, according to Spac Research. Of these, 120 have announced mergers and 433 are still hunting for a target.

Read more:
Special purpose acquisition companies fall out of favour with investors

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us and our affiliates. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

MORE than half of students in the Philippines consider temporarily dropping out of school until the coronavirus pandemic ends mainly due to difficulties in...

Economy

The Public Works department has ramped up the completion of projects such as the Sta. Monica-Lawton Bridge also known as the Kalayaan Bridge. —...

Economy

THE BUREAU of the Treasury (BTr) raised its planned borrowings from the local market to P235 billion in July, as it seeks to offer...

Economy

By Jenina P. Ibañez, Reporter MANILA is the 78th most expensive city for expatriates to live in according to Mercer’s 2021 Cost of Living...

Economy

LOCAL GOVERNMENT UNITS (LGUs) could boost their real property tax (RPT) collection by P113.4 billion with the implementation of a project that will digitize...

Economy

THE Department of Energy (DoE) has ordered National Grid Corp. of the Philippines (NGCP) to speed up the acquisition of the required ancillary services...

You May Also Like

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Investing

As a traditionally rigid insurance industry becomes bogged down by antiquated processes and operations, a handful of industry leaders are seeking to shake things...

Economy

US President Joseph R. Biden, Jr., will rely on ally countries to supply the bulk of the metals needed to build electric vehicles and focus on...

Economy

THE Securities and Exchange Commission (SEC) has warned the public from investing or to stop any investment in a group named Maxxprofit Computer Trading...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.



Your information is secure and your privacy is protected. By opting in you agree to receive emails from us and our affiliates. Remember that you can opt-out any time, we hate spam too!