SPAC Market Continues Recovery & Biggest SPAC Discounts for Thursday

The SPAC market has come back to an equilibrium where pre-deal SPACs trade close to NAV, good deals get rewarded, post-announcement execution can drive big returns, and strong IPOs could see high demand and a little pop too.

Author:
David Pogemiller
Publish date:
Apr 8, 2021

SPAC investors should be pleased with how the SPAC market went from "peak SPAC" just a few months ago to operating efficiently. There is still more to get cleared out and any combination of bad deals, silly IPOs, or bad news could change the mood, but for now investors will have confidence in the way it is operating.

In particular, most pre-deal SPACs will be around NAV, good deals will get rewarded, and post-announcement execution can drive big returns. Yesterday's IPO of CM Life Sciences 3 (CMLT / CMLTU) surged almost 12%; this is a big shift from the IPO drops that were happening over the past month. It is debatable whether this means that the "IPO pop" is back though. The CM Life team -- Keith Meister / Casdin Capital / Corvex Management -- is very strong with its first two SPACs having announced deals and trading very well:

CM 1 (CMLF) --> Sema4. Closed @ $15.23
CM 2 (CMII) --> SomaLogic. Closed @ $13.31

So, investors should continue to be patient and watch for IPOs from strong sponsors, find pre-deal SPACs at a discount, and consider getting aggressive when they see good combinations of deal and team. Patience and entry point will be key on any SPAC investment in this market.

A Surprise Evening Deal Announcement - Rice Acquisition (RICE)

In a surprise late night announcement on Wednesday, Rice Acquisition Corp. (RICE) announced it is combining Aria Energy and Archaea Energy and taking them public in a $1.15 billion SPAC merger. That will make the combined company into a leading renewable natural gas platform.

The $300 million PIPE included The Baupost Group, BNP Paribas Energy Transition Fund, CIBC, Goldman Sachs Asset Management LP, and Wellington Management.

Investors will have had all night to digest this deal -- announcing at 8pm ET is a very odd time for any SPAC deal -- so seeing how it trades this morning will be interesting.

Today's Discounts and Yesterday's Biggest Gainers / Losers

Biggest Discounts

-3.90% ~ $ 9.61 | MIT - Mason Industrial Technology, Inc. (Pre-Deal)
-3.80% ~ $ 9.62 | GIGG - GigCapital4, Inc. (Pre-Deal)
-3.50% ~ $ 9.65 | TMAC - The Music Acquisition Corporation (Pre-Deal)
-3.50% ~ $ 9.65 | OSTR - Oyster Enterprises Acquisition Corp. (Pre-Deal)
-3.50% ~ $ 9.65 | AGAC - African Gold Acquisition Corporation (Pre-Deal)
-3.40% ~ $ 9.66 | THMA - Thimble Point Acquisition Corp. (Pre-Deal)
-3.30% ~ $ 9.67 | EAC - Edify Acquisition Corp. (Pre-Deal)
-3.30% ~ $ 9.67 | COVA - Crescent Cove Acquisition Corp. (Pre-Deal)
-3.13% ~ $ 9.69 | CFV - CF Acquisition Corp. V (Pre-Deal)
-3.00% ~ $ 9.70 | SHAC - SCP & CO Healthcare Acquisition Company (Pre-Deal)
-3.00% ~ $ 9.70 | AEAC - Authentic Equity Acquisition Corp. (Pre-Deal)
-3.00% ~ $ 9.70 | ADEX - ADIT EDTECH ACQUISITION CORP. (Pre-Deal)
-3.00% ~ $ 9.70 | PUCK - Goal Acquisitions Corp. (Pre-Deal)
-2.95% ~ $ 9.71 | MDH - MDH Acquisition Corp. (Pre-Deal)
-2.90% ~ $ 9.71 | EPWR - Empowerment & Inclusion Capital I Corp (Pre-Deal)

Biggest SPAC Gainers

10.26% ~ $ 13.00 | FTCV - FinTech Acquisition Corp. V (Announced)
5.02% ~ $ 11.09 | TSIA - TS Innovation Acquisitions Corp (Announced)
4.72% ~ $ 13.30 | DFHT - Deerfield Healthcare Technology Acquisitions Corp. (Announced)
3.64% ~ $ 10.83 | HLXA - HELIX ACQUISITION CORP (Pre-Deal)
3.59% ~ $ 10.68 | FTOC - FTAC Olympus Acquisition Corp (Announced)
3.39% ~ $ 13.13 | AGC - ALTIMETER GROWTH CORP (Pre-Deal)
3.09% ~ $ 10.00 | CAHC - CA Healthcare Acquisition Corp. (Announced)
2.93% ~ $ 14.03 | PSAC - Property Solutions Acquisition Corp (Announced)
2.92% ~ $ 9.96 | FORE - Foresight Acquisition Corp. (Pre-Deal)
2.80% ~ $ 10.27 | NBA - New Beginnings Acquisition Corp (Announced)

Biggest SPAC Decliners

MUDS loses some luster following yesterday's pop on the Topps deal

-11.52% ~ $ 36.26 | BRPA - Big Rock Partners Acquisition Corp (Announced)
-8.16% ~ $ 11.60 | NPA - New Providence Acquisition Corp (Announced)
-6.70% ~ $ 22.82 | CCIV - Churchill Capital Corp IV (Announced)
-5.98% ~ $ 13.21 | ARYA - Arya Sciences Acquisition Corp III (Announced)
-5.86% ~ $ 9.79 | SCLE - Broadscale Acquisition Corp (Pre-Deal)
-5.48% ~ $ 10.87 | MUDS - Mudrick Capital Acquisition Corporation II (Announced)
-5.38% ~ $ 12.49 | BOWX - BowX Acquisition Corp (Announced)
-3.93% ~ $ 21.28 | DMYD - dMY Technology Group, Inc. II (Announced)
-3.71% ~ $ 10.64 | AONE - one (Announced)
-3.61% ~ $ 12.01 | FSRV - FinServ Acquisition Corp (Announced)
-3.32% ~ $ 12.54 | THCB - Tuscan Holdings Corp. (Announced)