Not all is doom and gloom in SPAC-land, Woodruff Sawyer writes in a blog post. Those in the know realize that there are still good deals to be made using the SPAC vehicle. They are keeping that knowledge to themselves, allowing the media to paint a different picture for the rest, the firm wrote.
Continued difficulties in the financial market in 2023 made it difficult to single out dismal SPAC performance when many traditional IPOs and mature public companies were also underperforming. “As we reported last year, when the entire market is hurting, it is difficult for a plaintiff’s attorney to claim that one particular team or merger did particularly badly,” the firm noted.
The proposed SEC rules, which came out in March 2022, were largely integrated into the playbook for a new SPAC IPO or a de-SPAC even before they were finalized in January.
Only about 30% of the 2023 SPACs opted to be organized in Delaware. Compare this percentage to almost 100% of SPACs launched in prior years. SPAC sponsors, who are watching the unfavorable developments in Delaware courts and unwilling to shell out extra funds for the new 1% excise tax, are clearly reconsidering their place of incorporation. At this point, most new teams are opting for the Cayman Islands over Delaware. REad more.
