“More Evidence of How Frothy SPACs Can Be”
Bloomberg | June 2, 2021
SPACs have indicated since April 2020 that they anticipate earning 1% or more on the cash they raise before spending it on acquisitions, but the actual interest reported so far is only a fraction of this.
In this article, Pratap Narayan Singh highlights the failure of SPACs to guarantee interest rates promised to investors and the resulting loss of confidence.
Extract from the article: “Anyone tracking the Treasury market could have figured out that a 1% rate was just not going to happen… Once you lose confidence in the interest-rate calculation, which is a basic thing, then you lose confidence in everything else.”