The fast track IPO: success factors for taking firms public with SPACs

Douglas Cumming, Lars Helge Hass, Denis Schweizer

Research output: Contribution to journalArticle

16 Citations (Scopus)

Abstract

Special Purpose Acquisition Companies (SPACs) are shells initiated with the sole intent of acquiring a single privately held company. SPAC shareholders vote on this acquisition, and in this paper we identify the factors that affect approval probability. Surprisingly, the data indicate more experienced managers and boards do not enhance the probability of deal approval. Similarly, glamor underwriters and larger underwriter syndicates are less likely to be associated with successful SPACs. Further, we find a negative relation between the presence of active investor (hedge funds and private equity funds) shareholdings in a SPAC and approval probability.
Original languageEnglish
Pages (from-to)198-213
Number of pages16
JournalJournal of Banking and Finance
Volume47
DOIs
Publication statusPublished - 1 Oct 2014

Keywords

  • Special Purpose Acquisition Company (SPAC)
  • ownership structure
  • board structure
  • voting

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