The special purpose acquisition company (SPAC) market has boomed over the past several years, with continued increases in IPO activity and record completions of de-SPAC transactions. More than 50% of total IPOs in 2020 were SPACs, this represents a 4x increase from the previous year. As of March 25, 2021, 445 SPACs have filed with the SEC with 296 SPACs pricing, raising over $89 billion*. This surpasses 2020's record number of 248 SPACs raising over $76 billion* for the full year of 2020. Over 445 SPACs are looking for their target globally with an additional 225+ pending pricing and expected to complete in Q2, this means over 670 SPACs are knocking on the doors of private companies or public companies looking to carve-out a business unit.
The popularity of SPACs can be attributed to factors such as highly regarded sponsor teams, their unique investment structure, and the well-established complementary private investment in the public equity (PIPE) financing market. As investors seek opportunities to earn outsized returns in a low-interest rate, low-yield environment, companies are also eager to partner with world-class sponsor teams and exert more control over valuation and share price, and to mitigate some of the market volatility risks. At the same time, the push to de-SPAC is continuing in 2021 as SPACs must complete their de-SPAC transaction within the two-year post-IPO deadline. SPAC sponsors are reportedly ‘competing’ to attract target businesses in Asia for de-SPAC opportunities.
In this rapidly-evolving landscape, how should SPAC sponsors and Asia Pacific companies prepare? What are the associated risks stakeholders must not overlook when choosing the SPAC route vs. a traditional IPO? Donnelley Financial Solutions (DFIN) proudly organized its first APAC focused SPAC webinar on April 15, 2021, bringing together capital markets leaders from NYSE, J.P. Morgan, Latham & Watkins and PwC to discuss these topics:
- The SPACs market landscape – challenges and opportunities facing sponsors and target firms as 2021 unfolds
- Pros and cons of the SPAC route vs. traditional US IPO
- Readiness for the de-SPAC opportunity: what are the risks businesses must not overlook when choosing the SPAC route?
- Southeast Asia spotlight: a surge in SPAC activities and implications to stakeholders
- Factors leading to a successful merger into a SPAC. From accelerated filing & post-SPAC compliance, PIPE financing to accounting & controls standards.
Gregor Feige – Co-Head of Asia (Ex-Japan) ECM, J.P. Morgan
Sharon Lau – Partner & Global Corporate Department Vice Chair, Latham & Watkins
Jennie Dong – Head of SPACs, NYSE
Delano Musafer – Head of Asia-Pacific Capital Markets, NYSE
Jasmin Maranan – Partner, Capital Markets, PwC
Bridget Hughes – VP, Corporate Governance & Compliance Services, GCM, DFIN
Duration: 1 hour
Date of recording: April 15, 2021