The Daily Dish (09/02/21)
SPAC Pullback Erases $75 Billion in Value
Just six months after a frenzy in SPAC listing, a broad selloff in the market has wiped out $75 billion off the value of companies that have gone public through SPACs. About 75% of the SPACs that have merged with target companies are trading below their IPO price.
Since February, 137 SPACs that have closed mergers have lost 25% of their collective value. Losses had topped over $100 billion in August, but have slightly recovered since.
SPAC declines are concentrated in firms tied to inexperienced power and sustainability, although the confidence in the broader SPAC market has also taken a hit.
The retreat is also hitting funds managed by BlackRock and Constancy Investments in addition to many hedge funds, pension managers and traders who have raced to place cash into SPACs over the last 12 months.
Singapore Rolls out New SPAC Guidelines
SPACs will be allowed to list in Singapore starting Friday under more liberal rules than initially expected.
SPACs that plan to list on SGX will require a minimum market cap of S$150 Million ($112 Million), which is half of the amount proposed earlier, while some limits on warrants and share redemption have been removed.
Singapore’s approval has beaten Hong Kong to the punch and comes as global financial regulators are stepping up scrutiny of SPACs.
SGX decided to change its proposed rules for SPAC listing following market feedback.
Vice Media Faces Significant Uncertainty After SPAC Deal Falls Through
Brooklyn based company Vice Media now faces dark days ahead after its SPAC deal fell through earlier this week.
Initially, the company had planned to merge with SPAC 7GC at a valuation of $3 billion including debt, but the company didn’t have sufficient financials, which resulted in the deal falling through.
Vice Media contains female-focused web site Refinary29, Vice News and style publications i-D. Vice Media now plans to boost money to show that the company is worthwhile, but the new plan may be a stop-gap until the company figures out what to do next.
With a SPAC merger off the table, the company’s remaining choices are to embrace promoting the business, spinning off the property or introduce additional price cuts in the business.
Palantir Secures Strategic Partnerships with BlackSky After SPAC Investment
Palantir has committed to an equity investment in space-based geospatial intelligence company BlackSky once it completes its SPAC merger with Osprey Technology Acquisition Corp.
The terms of the agreement include BlackSky entering into a multi-year software subscription agreement with Palantir to access the Palantir Foundry enterprise platform.
BlackSky said it will now offer a combined solution that integrates Spectra AI with Palantir Foundry to expand the delivery of high-resolution imagery and deep analytics to customers worldwide.
