SPACs Close Down Again on a Sleepy Friday
SPACs closed down on the day again, with the average pre-deal SPAC trading at $9.80. No new deals today, with just 4 announced on the week.
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It s definitely been a sad May for SPACS with little good news to get investors excited. That being said, we continue to reiterate our view that the slowdown is positive for the longterm health of the broader SPAC market.
Little activity today with no new mergers getting announced, and just one new IPO traded with
Graf Acquisition Corp. closing down 0.7%. SPACs slid lower, once again, and the average pre-deal SPAC is now trading at $9.80 a steep discount to NAV.
A Slow, Painful Week for Most SPAC Investors
A light week for SPAC M&A and the new issue market has hit saturation. Pre-Deal SPACs will soon feel the pressure to start finding targets.
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Apr 23, 2021
While 3 deals ultimately announced this week (HZAC, FWAA, and DBDR) it was still a slow week compared to peak SPAC merger frenzy. This week s deals provided modest pops - despite what has (mostly) been a rollercoaster overall week for risk assets. On a happy note, SPACs finished Friday largely up, for the first time in what feels like years.
Overall, the week was one where the mood felt increasingly dark with the media only adding to it with little positive to say.
SPAC Wrap: Investors Should be Happy with a Merger-less Monday; Announced Deals Take a Hit
Merger-less Monday was a bit of a surprise today, but given SPACs with announced deals took a hit, that s probably a good thing. Look for activity to pick up as the week progresses though.
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Apr 12, 2021
Even given the otherwise sideways day in the markets (S&P up, DJIA down, Nasdaq 100 down), some investors will be a bit disappointed in the SPAC activity. No deals were announced, SPAC IPOs stayed on the sidelines, and we saw only two prospective new SPACs file S-1s.
Those invested in SPACs with announced deals took a hit today though. The majority of units and common shares were down, with some down significantly (e.g. PSAC / Faraday; see full list below). Investors will need to be careful about deciding when to get in and out of SPACs once the deal is announced. While there have been some good post-deal pops on great execution (e.g. DMYD and MUDS w/ its NFT play announced today),
SPAC Opportunities for Thursday
The flow of new SPACs and rapid fire deals has finally slowed. This will give SPAC investors an opportunity to invest strategically as we go forward in 2021.
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Union Acquisition Corp II (LATN) agreeing to a $1.1B EV deal with
Procaps, a LatAm Pharmaceuticals company gives continued relief to overwhelmed SPAC investors. Everyone in the SPAC market had simply become exhausted by the pace of new filings, new IPOs, and often irrational prices.
With the market slowing, investors will have an opportunity to take a breath and do their homework to (a) identify high conviction SPACs and (b) carefully monitor them across the lifecycle to take advantage of the inherent yield plus optionality play that SPACs offer.