Advisory solutions for special purpose acquisition vehicles
Special purpose acquisition vehicles are becoming increasingly popular in the alternative space as companies look for ways to go public outside of the traditional IPO. Often called “blank check companies,” SPACs and their management teams raise money to acquire companies.
Anyone from institutional investors to the general public can invest in SPACs. Once the IPO is complete, the money is placed into a trust account and can only be used to complete an acquisition of a company. The SPAC typically has two years to acquire a company or the capital is returned to its investors. Once an acquisition is complete, the SPAC is usually listed on the stock exchange.
For companies, SPACs provide a simplified process for making their shares available to the public. SPACs will still need to go through the SEC IPO registration process when they initially offer shares to investors, but the operating company that is acquired will not need to file a full S-1 registration statement. The process of selling a company to a SPAC can be quicker than the traditional IPO while also reducing some of the volatility risk of the traditional IPO.
In 2019, SPACs raised a record $13.6Bn and have raised close to $50Bn over the last 10 years.
Our team leverages its deep network of relationships to assist SPACs in their search for target companies. We also provide timely advice and assistance related to the business combination by helping our clients think through the transaction execution and any market issues.