April 21, 2016
Roughly one year after the first special purpose acquisition company (SPAC) debuted in Canada—a $113 million “shell” company launched by Dundee Acquisition Corp.—the SPAC is yet to acquire a target company and realize its time-bound investment mandate. A Financial Post article delving into the structure and progress of the SPAC in Canada has referenced Torys’ article, “The M&A Clock is Ticking For SPACs in Canada,” which was released as part of our M&A Top Trends annual publication. Below is an excerpt of the article.
The issuer raised almost $113 million—with investors buying units with each unit consisting of a share plus hal a share purchase warrant. (The two securities trade separately.) In quick succession four other issuers followed with all management teams given two years to find a deal.
So far none of the five—which collectively raised more than one billion dollars of equity—have announced a transaction that to become effective requires the support of more than half the shareholders. It can be presumed that all the five have been busy trying to find a target. "The key driver in a SPAC IPO's success is the strength and credibility of the founders selecting the target acquisition," said Torys in a recent write-up.
To read the full article, click here.
To read M&A Top Trends 2016, our compilation of influential developments for M&A in the year ahead, click here.