So far in 2022, there have been 48 SPAC liquidations, and another 40 are planned for before the end of the year, fresh data by SPAC Research shows, The Wall Street Journal reports. Buyout stars such as Alec Gores and Chamath Palihapitiya have recently said they would return billions to investors. Until recently, liquidations were rare.
For sponsors, liquidation means putting a match to between $6 million and $9 million—the cost of listing a SPAC. Also, many who happily closed inflated deals in 2020 and 2021 are now suffering, because they usually aren’t allowed to cash out for at least a year after completion. They initially appeared to benefit handsomely, but it is now clear this was in exchange for taking big risks. Read more.
