Olde Hornet
Well-Known Member
SPACs have raised over $38 billion in 2021, but new NYSE rule looms
The SPAC craze doesn't seem to be slowing down in 2021 but could face new challenges with NYSE direct listing rule change.
www.cnbc.com
The 2021 IPO market is already on fire six weeks into the new year, with SPACs leading the way.
SPACs have raised more than $38 billion year to date, with an average of $296 million for 128 SPAC IPOs, according to SPACInsider. That’s nearly half the money raised by SPACs in 2020. Last year, SPACs hauled in a record $83 billion with an average of nearly $335 million for 248 listings.
This year’s numbers dwarf those in previous years. In 2019, only $13.6 billion were raised through SPACs. In 2018 and 2017, they collected $10.7 billion and $10 billion, respectively.
The big question this year is how a change to the New York Stock Exchange’s direct listing rules will impact the IPO market.
The new rule, which was approved by the Securities and Exchange Commission in late December, will allow companies to raise fresh capital through direct listings as opposed to just selling existing shares. Under the change, companies can raise cash from retail investors as well as by selling existing shares of the company. Making direct listings more attractive could cut demand for a SPAC or traditional initial public offerings.