Cancelled SPAC Technology Mergers: List of Abandoned M&A Deals Grows – ChannelE2E

by Joe Panettieri • Feb 14, 2022
Wall Street’s brief and heated love affair with SPACs (Special Purpose Acquisition Companies) continues to cool off.
The list of SPACs and technology companies that announced but then abandoned M&A plans involves such sectors as 3D printing, telecom services and e-commerce platforms. The cancellations offer a cautionary reality check for MSPs and IT service providers that were exploring potential SPAC engagements.
Examples of canceled M&A SPAC deals include:
On a related note, CAVU Technology Acquisition, a SPAC focused on the IT services market, abandoned its plan for a $100 million IPO (initial public offering) in January 2022.
The cancelation trend emerged in the second half of 2021. Indeed, 17 SPAC mergers, valued at a combined $37.2 billion, were terminated during the final six months of 2021, compared to four worth $720 million during the six months prior, according to data provided to Forbes by financial data firm Dealogic. Just seven SPAC deals were terminated in 2020, that Forbes/Dealogic report stated.
The SPAC trend was red-hot in early 2021. A SPAC or “blank check” company is designed to raise funds in an initial public offering (IPO) with the aim of acquiring a private business. That private company then becomes public as result of the merger, Reuters notes.
The SPAC trend helped to fuel $63 billion of IPO fundraising worldwide in January 2021, more than five times the proceeds from the same period a year earlier, Bloomberg reports.
However, the SPAC boom led to excess IPO supply that dragged down financial markets in early 2022, CNBC’s Jim Cramer said on January 25, 2022.
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