Going Public in the US by Merging into a SPAC: Weighing the Pros and Cons

Special purpose acquisition companies (SPACs) continue to grow in popularity and insignificance in the United States.  Despite the COVID-19 pandemic, the US capital markets remain active for SPAC IPOs.  Many emerging companies are receiving indications of interest from SPACs that are seeking acquisition candidates.  Our session focuses on helping management teams and boards of directors understand the considerations that should be taken into account in connection with going public through a SPAC merger, the SPAC merger process from the target’s perspective, and the challenges for former SPACs (post-merger) with respect to accounting, SEC reporting, and liquidity opportunities for stockholders.  We will cover:

• The SPAC market in the US
• Negotiating a merger with a SPAC—timing, process, and considerations
• Accelerating the path to US public company status and necessary preparations
• Pros and cons of the SPAC route versus a traditional IPO
• SEC disclosure, financial statement and pro forma financial statement requirements
• Undertaking a PIPE or other financing concurrent with the SPAC merger
• The application of Rule 144 and other SEC concerns post-merger CLE credit is pending.

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