SPAC Weekly Wrap: Signs of Life in SPAC Land

The SPAC market has stabilized a bit as things almost got back to normal this week. Several M&A deals were announced with some (RICE, MUDS) performing quite well. Pre-IPO activity remained light though and two were downsized.

Author:: David Drapkin
Publish date:: Apr 9, 2021

A bit of return to normalcy this week as it feels like the low point of the SPAC market is behind us. New issues actually traded up (unlike the tail end of March) and several deals were met with investor enthusiasm. Highlights include:

Rice Acquisition RICE soaring day-1 +52% on its announcement of Aria/Archaea
Mudrick Capital (MUDS) with a nice Day-1 pop in taking Topps public

A few other deals, including TWCT and ROT, were not met with much enthusiasm from the market. That being said, it's good to see deal activity come back. There are several rumored, large transactions that could be coming any day now:

Grab, the Singaporean app for everything, and Altimeter Growth (AGC). Which is being billed as potentially the largest ever SPAC M&A transaction
Soaring Eagle (SRNG) is exploring a $20bn+ deal with Ginkgo Bioworks
Bridgetown (BTWN) and Traveloka, the Indonesian travel co.
Yucaipa Acquisition Corp (YAC) and Signa Sports

ICYMI: SEC Looking at SPACs

Making the rounds in SPACland is a recent YouTube interview with Chamath Palihapitiya (the one time "SPAC King" with 14 SPACs/Pipes) where he suggests that SPACs can more fully capture the deal value than traditional IPOS because with the latter “you can’t show a [financial] forecast and you can’t talk about the future of how you want to do things — you’re just not allowed.”

“Because the SPAC is a merger of companies, you’re all of a sudden allowed to talk about the future,” Palihapitiya added. “When you do that, you have a better chance of being more fully valued.”

In a statement by John Coates, an acting director at the Securities and Exchange Commission, he worked hard to let sponsors, target companies, and investors that may not be the case.

“All involved in promoting, advising, processing and investing in SPACs should understand the limits on any alleged liability difference between SPACs and conventional IPOs,” Coates warned. “Simply put, any such asserted difference seems uncertain at best.”

Newly Announced SPAC Mergers

SPAC IPOs Priced

Overall 7 new SPACs priced for over $1.5B in fresh capital, and the majority are trading above offer. However, notably, two deals actually downsized their offerings. Aldel Financial (ADF) priced just $100M down from original $200M plans. Global SPAC Partners Co (GLSPT) priced $200M down from $230M.

CMLT, TIOA, TPGS, GLSPT, PANA, ADF, ACBA

New SPAC S-1s

Biggest Daily SPAC Gainers
12.92% ~ $ 17.30 | RICE - Rice Acquisition Corp. (Announced)
8.92% ~ $ 13.55 | FSRV - FinServ Acquisition Corp (Announced)
6.75% ~ $ 31.14 | STPK - Star Peak Energy Transition Corp (Announced)
6.00% ~ $ 14.48 | FTCV - FinTech Acquisition Corp. V (Announced)
4.25% ~ $ 13.97 | DFHT - Deerfield Healthcare Technology Acquisitions Corp. (Announced)
3.90% ~ $ 11.19 | AHAC - Alpha Healthcare Acquisition Corp (Announced)
2.88% ~ $ 9.99 | HCII - HUDSON EXECUTIVE INVESTMENT CORP. II (Pre-Deal)
2.84% ~ $ 10.13 | TSIB - Tishman Speyer Innovation Corp. II (Pre-Deal)
2.47% ~ $ 13.28 | TDAC - Trident Acquisitions Corp (Announced)
2.11% ~ $ 10.15 | BOAC - Bluescape Opportunities Acquisition Corp (Pre-Deal)

Biggest Daily SPAC Losers
-3.78% ~ $ 14.25 | VIH - VPC Impact Acquisition Holdings (Announced)
-3.02% ~ $ 9.94 | MSAC - Medicus Sciences Acquisition Corp. (Pre-Deal)
-2.91% ~ $ 12.69 | ARYA - Arya Sciences Acquisition Corp III (Announced)
-2.84% ~ $ 10.62 | TSIA - TS Innovation Acquisitions Corp (Announced)
-2.79% ~ $ 15.00 | CMLF - CM Life Sciences Inc (Announced)
-2.62% ~ $ 11.54 | LEAP - Ribbit LEAP Ltd (Pre-Deal)
-2.48% ~ $ 13.75 | AGC - ALTIMETER GROWTH CORP (Pre-Deal)
-2.43% ~ $ 18.10 | TPGY - TPG Pace Beneficial Finance Corp (Announced)
-2.37% ~ $ 10.30 | BLSA - BCLS Acquisition Corp. (Pre-Deal)
-2.31% ~ $ 11.83 | BTWN - Bridgetown Holdings Ltd (Pre-Deal)
-2.23% ~ $ 13.14 | JWS - Jaws Acquisition Corp (Announced)
-2.18% ~ $ 17.03 | ACTC - ArcLight Clean Transition Corp (Announced)
-2.13% ~ $ 9.65 | TMAC - The Music Acquisition Corporation (Pre-Deal)
-2.06% ~ $ 9.97 | MACA - Moringa Acquisition Corp (Pre-Deal)
-2.05% ~ $ 11.95 | SRAC - Stable Road Acquisition Corp. (Announced)
-2.04% ~ $ 17.77 | IPOE - Social Capital Hedosophia Holdings Corp V (Announced)
-2.01% ~ $ 10.23 | NOAC - Natural Order Acquisition Corp (Pre-Deal)

SPACs Most Off Their 52-Week High (closing prices; units)
SPACs with Announced Deals
-63.0% ~ $ 25.17 | CCIV - Churchill Capital Corp IV
-56.8% ~ $ 13.80 | SRAC - Stable Road Acquisition Corp.
-55.3% ~ $ 16.33 | THCB - Tuscan Holdings Corp.
-50.6% ~ $ 13.35 | NPA - New Providence Acquisition Corp
-50.2% ~ $ 11.40 | HOL - Holicity Inc
-50.1% ~ $ 12.90 | CAPA - HighCape Capital Acquisition Corp
-50.0% ~ $ 20.50 | NGA - NORTHERN GN ACQ
-48.7% ~ $ 45.64 | BRPA - Big Rock Partners Acquisition Corp
-47.1% ~ $ 11.06 | EXPC - Experience Investment Corp
-44.8% ~ $ 14.41 | GHVI - Gores Holdings VI Inc

Pre-Deal SPACs
-36.6% ~ $ 12.20 | IPOD - Social Capital Hedosophia Holdings Corp IV
-35.0% ~ $ 10.40 | THCA - Tuscan Holdings Corp. II
-34.0% ~ $ 10.73 | ZNTE - Zanite Acquisition Corp.
-33.0% ~ $ 12.96 | BTWN - Bridgetown Holdings Ltd
-32.2% ~ $ 11.71 | IPOF - Social Capital Hedosophia Holdings Corp VI
-30.7% ~ $ 10.87 | ALTU - Altitude Acquisition Corp.
-29.6% ~ $ 10.55 | PIPP - Pine Island Acquisition Corp
-29.2% ~ $ 11.36 | HAAC - Health Assurance Acquisition Corp
-25.7% ~ $ 11.39 | GSAH - GS Acquisition Holdings Corp II