Former Goldman Sachs president and economic adviser to President Trump Gary Cohn is the latest high profile figure on Wall Street to join a special purpose acquisition company (SPAC), teaming up with activist investor Cliff Robbins to raise $600 million in an initial public offering, as SPACs have become one of the hottest areas of dealmaking in 2020.
- A SPAC is essentially a shell company that raises money through an IPO in order to buy another company through a reverse merger, which it then takes public within a few years.
- Cohn has joined Cliff Robbins's blank-check acquisition company and is now listed as a co-founder, according to new filings with the Securities and Exchange Commission late on Tuesday.
- The pair are seeking to raise $600 million for acquisitions via an initial public offering for Cohn Robbins Holding Corp., selling 60 million units in an IPO at $10 apiece and listing on the New York Stock Exchange under the ticker “CRHC.U.”
- Earlier this year, Robbins announced that he would shut down his Blue Harbour Group investment fund to do something different, creating a SPAC under the name csr acquisition corp.
- Under the previous filing in July, Robbins was listed as the sole founder, with plans to raise $300 million.
- Cohn, who left his post at the head of Goldman Sachs to serve in the Trump White House and oversee the administration's tax overhaul enacted in 2017, had been in talks with Robbins about joining the SPAC for the past month, according to Reuters.
- While their joint company could pursue an acquisition in any industry, the SEC filing lists consumer, software and fintech sectors as being particularly attractive targets.
KEY BACKGROUNDCohn joins a growing list of high profile figures on Wall Street getting involved with the 2020 SPAC IPO boom, including Bill Ackman, Michael Klein and Chamath Palihapitiya. He is also not the first former politician to enter the world of special purpose acquisition companies: Former U.S. House Speaker Paul Ryan is chairman of blank-check company Executive Network Partnering, which on Monday filed with the SEC to raise $300 million. Some of the highest-profile examples of spac ipos so far this year include space tourism company Virgin Galactic and sports gambling company DraftKings.