The US SPAC (special purpose acquisition company) boom is coming to Europe, says Matthew Field in The Daily Telegraph. Also known as “blank-cheque companies”, SPACs are shell firms that list on the stockmarket in order to raise cash. They then use the money to merge with another company. SPACs provide an alternative route to a public stockmarket listing that can be more straightforward than the traditional initial public offering.
The latest SPAC boom started with Richard Branson’s Virgin Galactic space business, which went public through an $800m SPAC in 2019, says Field. Once confined to the US tech scene, European start-ups are now in the crosshairs too: UK electric-vehicle business Arrival is listing on the Nasdaq through a $660m SPAC. New SPAC vehicles are being launched in Frankfurt and Amsterdam.
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