Law firm Mayer Brown discusses 10 practice points that can SPAC counsel to execute a PIPE transaction alongside a business combination deal.
Redemption options inherently create uncertainty as to the amount of cash available to the combined company following the initial business combination. SPACs often seek to mitigate the redemption concern by issuing new securities to institutional accredited investors in a PIPE transaction that is contingent upon the closing of the deal.
As the SPAC market has cooled, PIPE transactions have also encountered difficulties. A changing landscape for SPACs calls for an extra measure of flexibility and a willingness to consider alternatives in connection with structuring the accompanying SPAC PIPE transaction. Read more.
