SPACs were one of Wall Street’s hottest trades during the pandemic bull market that finally came to a crashing close in June, Bloomberg reports. SPACs captured the imagination of a lot of ordinary investors who saw them as a way to get in early on promising startups before they went public.
The fad also attracted a range of Wall Street titans, athletes, and celebrities looking to get a piece of the pie by starting their own SPACs. But tumbling stock prices—especially those of more speculative, early-stage companies—have wiped out billions of dollars in value for shareholders who held SPACs after their acquisition deals. Some companies that went public via a merger with a SPAC have fallen so far that they’ve been bought by private companies or competitors at far lower prices. At the same time, a lot of blank-check companies that have yet to do a deal are coming up on big deadlines. Read more.
