SPACs: Special Purpose Acquisition Companies

Listing a SPAC on Nasdaq

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What is a SPAC?

SPACs—or Special Purpose Acquisition Companies—are publicly-traded investment vehicles that raise funds via an initial public offering (IPO) in order to complete a targeted acquisition. They provide private companies with a unique way to access the public markets, while offering investors a way to co-invest side-by-side with best-in-class sponsors. 

SPAC Process

 

SPAC Momentum Continues

Since 2010, Nasdaq has been the exchange of choice for SPACs. In 2020, we welcomed 71% of U.S. business combinations, including Opendoor, DraftKings and Luminar Technologies.* We are proud of the continued momentum of Nasdaq-listed SPACs and look forward to adding to this diverse group of companies on our market.

*As of December 2020

Last year, Nasdaq welcomed a myriad of SPAC listings and business combinations to our market including sports betting operator DraftKings. Nasdaq’s global head of SPAC listings, Eklavya Saraf, gives an exclusive look on how DraftKings tapped the public markets during market volatility in April 2020 here

Nasdaq SPAC Listing Requirements

To learn more about the SPAC listing process for our US markets and to review the essential information your company needs to pursue a listing on Nasdaq, including timelines, document checklists, listing requirements, and fee structures, access our Nasdaq Listing Guide here.

Our Regulatory Commitment to Our SPAC Community

As part of our commitment to SPAC listings, their advisors and business combinations, we have made progress on several rule changes that we believe will provide a more favorable environment for Special Purpose Acquisition Companies (SPACs) to list on our exchange. Check back for an update on the status of these filings.

Recent SEC Filings and Approvals

  • De-SPAC - Proposal to allow a De-SPAC 15 days post-closing of business combination to show compliance with shareholder requirements. The filing, pending SEC approval, is available here.

  • Exclusion from Shareholder Requirement - Excluding SPAC IPOs from the requirement that certain shareholders hold at least $2,500 of stock. View the filing here.

  • Service Package for Switches - Complimentary service package for switches upon completion of business combinationView the filing here.

  • Entry Fee Deferral - Entry fee deferral for new listings. View the filing here.

  • Annual Fee Wavier - Annual fee waiver upon acquisition close when transferring to NasdaqView the filing here.

  • SCI Services - Complimentary Strategic Capital Intelligence services. View the filing here.

Nasdaq's Board Diversity Proposal

How Would Special Purpose Acquisition Companies (SPACs) Comply?

In December 2020, Nasdaq submitted a proposal to the SEC seeking approval of new listing requirements for board diversity with the goal of providing stakeholders with a better understanding of a company’s current board composition and enhancing investor confidence.

SPACs are acquisition companies listed under IM-5101-2 and as such would be exempt from the rules in this proposal until they complete a business combination. Upon completing a business combination, the post-combination entity:

  • Would have one year to disclose its board diversity matrix
  • Would have two years or the remainder of the four to five year phase-in period (whichever is longer) to fully meet, or explain why it does not meet, the diverse director objectives

What Nasdaq-listed Companies Should Know >>

To view recent Nasdaq-listed SPAC IPOs, click through the photo gallery below. To view upcoming SPAC IPOs, click here.

April 2021 SPAC Activity

In partnership with SPAC Alpha, below is a snapshot of SPAC market insights and market share, monthly activity, and additional performance data.
Data Source: SPAC Research

Benefits of SPACs

Proven and Reputable Structure

SPACs offer founders efficient access to capital and the ability to build value.

Opportunity for Additional SPAC Formations

SPAC founders have the ability to create additional SPACs.

Faster Capital-Raising Process

SPACs offer faster capital-raising relative to private fund-raising. The accelerated execution and liquidity timeline is typically within 24 months from IPO to M&A.

Nasdaq Video Series: SPAC Chat

    FAQS

    Investors who participate in these investment vehicles not only receive common shares, but also warrants as part of the IPO. The initial funds raised through the IPO are placed into a trust or escrow account until the time of a potential business combination occurs. Investors also hold the right to vote on potential business combination targets and can choose to redeem their public shares.
    A SPAC is formed from capital raised in a traditional IPO. As a publicly-traded entity, a SPAC must satisfy Nasdaq’s listing requirements. SPACs can be used as a tool by public and private companies to raise funds for the purpose of an acquisition. In a SPAC, original investors vote on the business combination. In traditional IPOs, the underwriters market and sell the company shares.

    Our position as the industry leader supports SPACs and target private companies in making a seamless transition to the public markets. Through our market-leading investor relations (IR) intelligence services, we assist companies in building their IR programs and preparing for life as a public company. Beyond capital markets support, Nasdaq also provides post-transaction visibility services that helps to raise the profile of the combined entity to investors and customers.
    Information is provided for educational purposes only. The content does not attempt to examine all the facts and circumstances which may be relevant to any particular company, industry, strategy or security mentioned herein and nothing contained herein should be construed as legal or investment advice. Nasdaq does not recommend or endorse any securities offering; you are urged to read the company’s SEC filings, undertake your own due diligence and carefully evaluate any companies before investing. ADVICE FROM A SECURITIES PROFESSIONAL IS STRONGLY ADVISED.

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