In this video, we discuss what is SPAC or Special Purpose Acquisition Company, how they function, pros and cons, the latest deals involved in it.
What is a SPAC?
Special Purpose Acquisition Company is a public company that is created solely to acquire or merge with a private company in order to make it public. These companies do not have any functional services.
Advantages of SPAC
– It saves a tremendous amount of time and money.
– It is an easy route to become a public company.
– Provides a place for negotiating the premium price.
– Provides access to excellent financiers and managers
Disadvantages of SPAC
– The investor is not aware of where they are investing until it is revealed.
– May provide less returns than expected.
– Chances of fraudulent activity.
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