- Glorious August. By 2022 standards, August has started on fire in SPAC land. The first four days alone have seen seven new IBCs announced, with a total value of $5.3 billion versus 11 announced deals worth $8 billion for July. Add to that, four de-SPACings were completed involving three technology companies and one healthcare de-SPAC, with an aggregate deal value worth $3.7 billion. We can also report two SPAC IPO pricings, which have been rare in recent times. On August 4, automotive-focused SPAC Mobiv Acquisition Corp. (NASDAQ: MOBV) raised $87 million from its IPO. This is the first SPAC IPO to be completed since June 24 and was quickly followed by technology-focused Pono Capital Two (NASDAQ: PTWOU) on August 5, which raised $100 million.
- But it’s not all smelling like roses in SPAC land. As a warning against being lulled into a false sense of confidence that we may be hitting the bottom in SPAC land, redemptions remain high (~90%), while the number of liquidations continues to mount. Three more SPACs have announced they will return cash from their trust funds to shareholders later this month. This brings the total to 15 liquidations YTD, a number that is expected to rise before 2022 ends. Although no IBC terminations have been added to the record 33 that have occurred so far this year, stock and crypto trading platform TradeStation has served notice to SPAC Quantum FinTech Acquisition Corp. (NYSE: QFTA) it is setting to call off their proposed merger, setting up the prospect of a court battle reminiscent of the ongoing legal battle between Dune Acquisition Corp. (NASDAQ: DUNE) and its financial trading platform TradeZero.
- We’re alright Jack, say the arbs. Our SPAC Talk Focus returns to the topic of SPAC arbitrage, which continues to be the most lucrative investment strategy in SPAC land, even more attractive as it is a low-risk strategy akin to buying a short-maturing US treasury bill at a discount. SPAC yields indicate that this is still a money-making business for arbs.
SPAC STATISTICS
Source: WTR
Glorious August. By 2022 standards, August has started on fire in SPAC land. The first four days alone have seen seven new IBCs announced, with a total value of $5.3 billion versus 11 announced deals worth $8 billion for July. Add to that, four de-SPACings were completed involving three technology companies and one healthcare de-SPAC, with an aggregate deal value worth $3.7 billion. We can also report two SPAC IPO pricings, which have been rare in recent times. On August 4, automotive-focused SPAC Mobiv Acquisition Corp. (NASDAQ: MOBV) raised $87 million from its IPO. This is the first SPAC IPO to be completed since June 24 and was quickly followed by technology-focused Pono Capital Two (NASDAQ: PTWOU) on August 5, which raised $100 million.
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