According to Bloomberg, despite the crazy expansion of multiple SPACs (special purpose acquisition companies) during the pandemic, which caused stock prices to plummet, investors such as Howard Lutnick and Michael Klein are now entering the market again to raise billions of dollars. According to SPAC Research, 50 SPACs have raised $8.7 billion since April 2024, exceeding the total fundraising for the whole of 2023.
The recovery of the SPAC market has shocked industry insiders, especially after experiencing losses of almost 90%, many SPACs promoted by Lutnick and Klein have still failed to bring substantial returns to investors. Even so, these investors continue to launch new blank check companies (SPACs) to seek new profit points through acquisitions or mergers. Despite the mixed performance of the SPAC market, investors are still willing to buy these companies at the IPO stage, hoping to gain arbitrage opportunities from them. As a way to go public quickly, SPACs are no longer the "crazy rush" model they once were, but they are still an option for some companies to seek exit in the absence of other options. Analysts say that despite the current challenges facing SPACs, SPACs may still usher in new opportunities as the traditional IPO market picks up, especially against the backdrop of potential deregulation by the Trump administration.
