The Spac market offered investors only disappointment last quarter, but it may seem like the good old days as regulators crack down on new blank-cheque stocks and enthusiasm for existing ones wanes.
The IPOX Spac Index fell 9.5 per cent, the worst performance since its July 2020 launch, and has lost more than 22 per cent over the past three quarters.
There are 610 special-purpose acquisition companies, or blank-cheque companies as they are known, are hunting for deals or racing the clock to find one, and some existing transactions are falling apart. Spac warrants, which hold the promise of future windfalls, are trading at a fraction of year-earlier levels.
Heavyweight sponsors are pulling plans for new offerings. And that was before the US Securities and Exchange Commission laid out plans for new rules on Wednesday, putting the industry on notice that the era of bringing private companies public with overly rosy forecasts is over.
“Irrespective of these new SEC proposals, the Spac market has really been retrenching,” said Jay Ritter, a University of Florida professor who tracks new issues. “We’ve had 54 Spac IPOs this quarter, and I’d be shocked if any of the quarters for the remainder of the year hit that level.”
It’s no wonder that Spacs that are still empty-handed are trading for less than the cash they have in trust. And returns for the Spacs that did complete a merger are horrific, with declines of 27 per cent in the first quarter and 65 per cent from the 2021 high.
“The bottom is not in yet, because you have too many Spacs chasing too few deals; that has got to resolve itself,” said Matthew Tuttle, chief executive of Tuttle Capital Management, which runs an index that tracks Spac returns.
If the SEC equalises the playing field between traditional initial public offerings and Spacs, “it could be a lot harder for the crummiest of the crummy deals to happen”, he said.
Deal makers pulled the plug on a record 44 planned Spac listings in the past three months that would have raised $11.66 billion, data compiled by Bloomberg show.
A range of blank-cheque companies backed by household names like Wall Street veteran Ken Moelis and those with celebrities attached including a Spac that counted former New York Giants quarterback Eli Manning as an adviser, were among those to throw in the towel.
The bottom is not in yet, because you have too many Spacs chasing too few deals; that has got to resolve itself
Matthew Tuttle,
chief executive officer, Tuttle Capital Management,
Aborted Spac mergers reached a record high of 15 in the first quarter and more than 30 for the past year, according to data compiled by Chicago-based Spac Research.
In part, that’s because the deals were negotiated when prospects for Spacs and the macro outlook were brighter. Spacs and their targets that have called it quits on their tie-ups range from Carlyle Group-backed Syniverse Technologies to investing app Acorns Grow.
Investors have also dumped warrants issued by all types of Spacs, with the prices down more than two-thirds from a year ago, data compiled by Boardroom Alpha shows.
The downward spiral signals that investors do not expect Spacs to find any target or that they won’t find a partner that boosts their shares enough to make the warrants valuable. Pre-deal warrants are trading at 33 cents on average compared with 67 cents at the start of the year, while warrants tied to companies that have lined up deals are around 75 cents versus $1.13 at the end of 2021.
Gothia Cup 2025
4,872 matches
1,942 teams
116 pitches
76 nations
26 UAE teams
15 Lebanese teams
2 Kuwaiti teams
Lampedusa: Gateway to Europe
Pietro Bartolo and Lidia Tilotta
Quercus
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
Company%20profile
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UAE currency: the story behind the money in your pockets
How to increase your savings
- Have a plan for your savings.
- Decide on your emergency fund target and once that's achieved, assign your savings to another financial goal such as saving for a house or investing for retirement.
- Decide on a financial goal that is important to you and put your savings to work for you.
- It's important to have a purpose for your savings as it helps to keep you motivated to continue while also reducing the temptation to spend your savings.
- Carol Glynn, founder of Conscious Finance Coaching
Safety 'top priority' for rival hyperloop company
The chief operating officer of Hyperloop Transportation Technologies, Andres de Leon, said his company's hyperloop technology is “ready” and safe.
He said the company prioritised safety throughout its development and, last year, Munich Re, one of the world's largest reinsurance companies, announced it was ready to insure their technology.
“Our levitation, propulsion, and vacuum technology have all been developed [...] over several decades and have been deployed and tested at full scale,” he said in a statement to The National.
“Only once the system has been certified and approved will it move people,” he said.
HyperloopTT has begun designing and engineering processes for its Abu Dhabi projects and hopes to break ground soon.
With no delivery date yet announced, Mr de Leon said timelines had to be considered carefully, as government approval, permits, and regulations could create necessary delays.
Secret Pigeon Service: Operation Colomba, Resistance and the Struggle to Liberate Europe
Gordon Corera, Harper Collins
THE DETAILS
Director: Milan Jhaveri
Producer: Emmay Entertainment and T-Series
Cast: John Abraham, Manoj Bajpayee
Rating: 2/5
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
UAE currency: the story behind the money in your pockets
The 15 players selected
Muzzamil Afridi, Rahman Gul, Rizwan Haider (Dezo Devils); Shahbaz Ahmed, Suneth Sampath (Glory Gladiators); Waqas Gohar, Jamshaid Butt, Shadab Ahamed (Ganga Fighters); Ali Abid, Ayaz Butt, Ghulam Farid, JD Mahesh Kumara (Hiranni Heros); Inam Faried, Mausif Khan, Ashok Kumar (Texas Titans
In numbers: China in Dubai
The number of Chinese people living in Dubai: An estimated 200,000
Number of Chinese people in International City: Almost 50,000
Daily visitors to Dragon Mart in 2018/19: 120,000
Daily visitors to Dragon Mart in 2010: 20,000
Percentage increase in visitors in eight years: 500 per cent
Killing of Qassem Suleimani
Killing of Qassem Suleimani
How to register as a donor
1) Organ donors can register on the Hayat app, run by the Ministry of Health and Prevention
2) There are about 11,000 patients in the country in need of organ transplants
3) People must be over 21. Emiratis and residents can register.
4) The campaign uses the hashtag #donate_hope
