While SPACs were once viewed as the back door route to going public, these days, the IPO alternative is mainstream. SPACs are in the news nearly every day as major companies are opting for the SPAC route to taking a company public. While they may be trendy, SPAC is still a complex process and one that requires ample preparation.

The following SPAC checklist of documentation and SPAC readiness information should help you navigate the SPAC process timeline with ease.

1. Legal

SPAC vs. Traditional IPO

As of December 2020, more than 200 companies had used a SPAC (special purpose acquisition company), to go public, rather than the more traditional IPO (initial public offering) method. SPACs continue to dominate business headlines, with SPAC transactions accounting for some $170 billion in equity thus far in 2021.

Since 2020, a rising number of companies have chosen to go public through the de-SPAC process rather than a traditional IPO. This means a private company combines with a Special Purpose Acquisition Company (SPAC), which is essentially a shell company formed for the express purpose of acquiring targets and taking them public.

Special purpose acquisition companies (SPACs) offer an alternative path to the IPO when taking a company public. Below, we’ll answer the question, “What is a special purpose entity?” along with covering the SPAC process and why more business leaders are choosing this option when taking their companies public in the present market.

Will 2021 Be a Good Year for U.S. Markets?

Despite the pandemic, 2020 was the biggest year for IPOs since 2014, and I am confident that the positive trend will continue for IPO stocks in 2021. It’s already getting off to a fast start with the Wall Street debut of mobile game developer Playtika Holding (PLTK), which benefits from strong videogame demand and a popular lineup of titles like Slotmania, Bingo Blitz, and Board Kings.

Investment Outlook: 2021 Looks Bright – a blog by Craig Clay, President of Global Capital Markets, DFIN

Despite the pandemic, 2020 was the biggest year for IPOs since 2014, and I am confident that the positive trend will continue in 2021.

2020 Review and 2021 Outlook – an exclusive interview with Craig Clay, President of Global Capital Markets, DFIN with DealStreetAsia

In conversation with DealStreetAsia (DSA), Craig Clay, President of Global Capital Markets, DFIN discussed how the US election will impact dealmaking, the rise of SPACs, virtual due diligence and how having a risk and compliance solutions partner can smoothen the path to an IPO and beyond. Here are some excerpts from the interview:

SPAC Transactions

The numbers alone speak volumes. As of mid-September 2020, 95 SPACs (special purpose acquisition companies) with a valuation of approximately $35 billion had priced year to date, shattering “all previous records,” said Craig Clay, President of Global Capital Markets for Donnelley Financial Solutions. In contrast, he said, for the full year of 2019, 59 SPACs had priced, and even this represented a sizeable increase over 46 in 2018 and 34 in 2017.