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> The pair of cancellations, which happened less than an hour apart Is this literally just two cancellations? I never put any money into a SPAC, but I suspect
by htag 4y ago
> The pair of cancellations, which happened less than an hour apart
Is this literally just two cancellations? I never put any money into a SPAC, but I suspect the shareholders are better off with their money returned than going into a bad deal. Concord raised money at $10/share, and they are returning $10/share back. I don't feel bad for the investor that bought it for $13/share from an exchange and lost $3. Concord didn't do business, they didn't produce a product, they never merited a 30% above cash market price.
- anjel 4y agoAccording to the New York Times, SPAC redemptions industry wide were 50% this year, up from 20% last year. https://archive.ph/1Fa9V https://archive.ph/1Fa9V
- htag 4y agoSPAC redemptions are just investors asking for their money back so they can use it elsewhere. From the SPAC share owner's perspective this is the system working as intended. Redemptions lower the amount of money in the fund, which gives them weaker negotiating power when making the acquisition. I won't feel bad for the fund manager doesn't have enough money to buy the investment they had their eyes on. The downturn across all SPACs gives them less negotiating power as a class, but again, that's not a big loss for society.
- hedora 4y agoYeah; the title is kind of clickbait. Before I read the article, I was wondering if the SEC stepped in, or if some sort of financial services Sybil attack just unwound due to a bunch of not-so-independent-after-all players deciding to cut and run. It is interesting that they have clauses to return shareholder money if the deals are cancelled (otherwise, this would be indistinguishable from a pump and dump scam).