SPAC bankers are agreeing to slash their fees on deals if they face large redemptions in a sign of the desperation to complete blank-check transactions in a difficult market, the Financial Times reports.
Investors have been redeeming their money from SPAC deals at increasing rates amid heightened regulatory scrutiny, a string of scandals and poorly performing Spac mergers. Average redemptions hit 90% in February, according to Dealogic data.
The SPAC market has significantly cooled in recent months as investors grow wary of funding companies with little revenue or inexperienced management teams. SPAC bankers, who have enjoyed a fee bonanza from arranging deals, are now cutting their fees depending on the level of investor redemptions. Read more.
