Blank-check companies are having a record-breaking year, raising about $41 billion so far, according to data compiled by Bloomberg.
That’s more than the last 10 years combined, the data show, and much of it is recent: About $29 billion has been raised since July 1. This year’s total comes from 109 deals, compared with $12.4 billion raised from 54 deals in 2019.
SPAC Boom
Red-hot blank-check companies have raised $41 billion in record year
Source: Data compiled by Bloomberg
Many well-known names, including hedge fund billionaire Bill Ackman, Oakland A’s executive Billy Beane and Gary Cohn, the former Goldman Sachs Group Inc. president and economic adviser to President Donald Trump, have started so-called special purpose acquisition companies — or SPACs. The vehicles list on stock exchanges with the aim of raising money to buy companies. About 40% of this year’s initial public offering volume has come from SPACs.
The intense investor interest has also attracted scrutiny from regulators. The U.S. Securities and Exchange Commission is reviewing SPACs because it’s concerned that shareholders don’t fully comprehend how incentives tied to executive pay differ from traditional IPOs, agency Chairman Jay Clayton said Thursday.
Source: Bloomberg – SPACs Have Raised More in 2020 Than the Last 10 Years Combined