In defence of SPACs
Since SPACs are cash shells that often have emerging technology companies on their radar, the IPO market has returned to its glory years. So, why are regulators going after them?
June 14, 2021 / 06:04 PM IST
Steven Davidoff Solomon
Special purpose acquisition companies, better known as SPACs, have single-handedly revived the market for initial public offerings, taking small companies public by the dozens. So far this year, there have been roughly twice as many listings of these blank-check companies as traditional offerings.
And since these cash shells — which raise money in an IPO on the promise of merging with a private company within a couple of years, taking it public — often target emerging tech companies,...