SPACs: Special Purpose Acquisition Companies

Listing a SPAC on Nasdaq

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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.

SPAC Process

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

SPAC Momentum Continues

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

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.

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.

Excluding SPAC IPOs from the Requirement that Certain Shareholders Hold at least $2,500 of Stock

Our recent filing eliminates the requirement that a SPAC IPO demonstrate that at least half of its required shareholders each hold unrestricted securities with a market value of at least $2,500. You can view the filing here.

Complimentary Service Package for Switches Upon Completion of Business Combination

Acquisition companies that switch a listing to Nasdaq, are eligible to receive our complimentary services package if the SPAC switches from NYSE to Nasdaq after announcing its business combination.  This will improve the process for SPAC switches, removing a disincentive for the SPAC to switch before the deal is completed and reducing the execution risk that came from the SPAC needing to precisely coordinate the time of the switch and the closing of the business combination. You can view the filing here.

Entry Fee Deferral for New Listings

Nasdaq will defer certain entry fees for acquisition companies for one year, beginning from the date of their listing. The fee deferral will provide an incentive to sponsors to list their SPAC while recognizing the unique structure of acquisition companies in the initial post-IPO period. You can view the filing here.

Annual Fee Wavier upon Acquisition Close when Transferring to Nasdaq

Nasdaq will waive the all-inclusive annual listing fee applicable to securities listing upon the close of an acquisition by a private company of a SPAC listed on another national securities exchange. The fee waiver applies to the year the transfer is made. The rule change is designed to alleviate the issuers of an irregular fee outcome arising from how the acquisition company business combination has been structured. You can view the filing here.

Complimentary Strategic Capital Intelligence Services 

Nasdaq will provide complimentary access to our strategic capital intelligence product following the announcement of the business combination. Through the targeting tool, our analysts will help acquisition companies identify and communicate with their shareholders and prospective investors about their long-term vision, and also help them tailor messaging and measure the company’s impact on their holdings. You can view the filing here.

 

January 2021 SPAC Activity

Review SPAC market insights, monthly activity, and additional performance data.
Data Source: SPAC Research

Learn more about SPACs

    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.

    FAQS

    Special Purpose Acquisition Companies (SPACs) are publicly-traded investment vehicles that raise funds via an IPO in order to complete a future 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.

    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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