SPACs, or special purpose acquisition companies, were considered a backwater of the capital markets a decade ago. In 2020, they emerged as one of the most active areas on Wall Street – and Reuters has been keeping clients and readers ahead on the latest news.
The rise of SPACs has been driven by splashy deals for the likes of space tourism company Virgin Galactic Holdings, sports betting company DraftKings Inc and electric vehicle startups like Fisker Inc. This has made them an increasingly popular way for early-stage companies to list their shares instead of a traditional IPO. New SPAC managers like ex-Trump adviser Gary Cohn and former House Speaker Paul Ryan have also been attracted by the wildly lucrative payouts on offer if they can find a company with which to merge.
