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Journal of Banking & Finance Vol. 47 2014

The fast track IPO – Success factors for taking firms public with SPACs

Douglas J. Cumming1; Lars Helge Haß2; Denis Schweizer3,4

1 York University · 2 Lancaster University · 3 Concordia University · 4 WHU – Otto Beisheim School of Management

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.

DOI
10.1016/j.jbankfin.2014.07.003
Volume
47
Pages
198-213
Language
en
Sources
openalex crossref bibtex:phds-export.bib

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