The Intelligence from The Economist SPAClash: the buzz and the bust
Apr 27, 2021
Alice Fullwood, Wall Street correspondent for The Economist, shares her insights on the rise and challenges of Special Purpose Acquisition Companies (SPACs), exploring their impact on investments and market trends. Cultural writer Michael Hann discusses Brazil's controversial gun laws, highlighting political implications under President Bolsonaro. The episode also transports listeners to HighMag, the world's largest magazine archive, emphasizing its role in preserving cultural history and the ambitious digitization project that aims to make this treasure trove accessible to all.
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SPACs Surge in Popularity
- SPACs, or Special Purpose Acquisition Companies, have become a popular way for companies to go public.
- This has been driven by high-profile deals and the promise of high returns.
SPAC Mechanics
- SPACs raise capital and then merge with a private company to take it public.
- This provides the company with cash and a listing on a stock exchange.
Virgin Galactic SPAC
- Chamath Palihapitiya's deal with Richard Branson for Virgin Galactic's public listing via a SPAC in 2019 fueled the SPAC craze.
- This high-profile deal drew attention to SPACs as an alternative to traditional IPOs.