The wave of enthusiasm for SPACs is evaporating amid heightened regulatory attention and some high-profile flops, with redemption rates climbing as many SPACs trade under the value of their cash holdings — typically $10 a share, Bloomberg reports.
According to Bloomberg analysis of Spacresearch.com data, the median redemption rate for North American SPAC deals completed in July was almost 50%. Redemptions deprive the target of cash to help fund development and expansion plans, and if the current trend continues, it may also undermine the notion that SPACs are a more predictable way of going public than a traditional IPO. Read more.
