To the Moon: SPAC Frenzy Continues in 2021


The Special Purpose Acquisition Company (SPAC) momentum shows no signs of slowing down this year, with a number of high-profile companies and investors choosing this structure to raise billions of dollars. A SPAC, or so-called "blank-check company," has no commercial operations and is formed strictly to raise capital for the purpose of acquiring an existing company.


This type of setup gained a lot of momentum in 2020, with more than 50 SPACs raising billions of dollars. In fact, SPACs outpaced traditional initial public offerings (IPOs) last year, raising more than $73 billion, according to Business Insider citing Goldman Sachs research.



Goldman analysts expect the trend to continue this year, and we're seeing reports of high-profile investors exploring the SPAC route, including WeWork, Elliott Management Corp., and former baseball star Alex Rodriguez. This year, SPACs have raised more than $38 billion through 128 IPOs, according according to SPAC Research.


After its high-profile failure to go public in a more traditional way, WeWork is now exploring additional options to go public and is "weighing offers from a SPAC affiliated with Bow Capital Management LLC and at least one other unidentified acquisition vehicle for several weeks," according to a report from The Wall Street Journal last month.


Shake Shack Inc. (SHAK) founder Danny Meyer's SPAC called USHG Acquisition Corp. filed to raise $250 million in an IPO last week, Bloomberg reported. Hedge fund Elliott Management Corp. is looking to raise over $1 billion for its SPAC, according to a report in The Wall Street Journal on Sunday. And Alex Rodriguez is another high-profile name jumping on the SPAC bandwagon to launch a shell company called Slam Corp., according to Business Insider. Slam is looking to raise $575 million, according to the SEC filing

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