It is a reasonable extrapolation – and we are nothing at
Cooley if not wildly reasonable – that, since the beginning
of time, more operating companies are considering going public
through a merger with a SPAC (Special Purpose Acquisition Company).
While the number of SPAC IPOs may have peaked in 2020 and in the
first quarter of 2021, there are still plenty of SPACs seeking
acquisition targets, and deSPAC activity has remained robust
throughout 2021.
As companies noodle over whether a SPAC transaction may be right
for them, here are some key considerations:
1. Picking the right SPAC sponsors
Although the structures haven't changed much in many
years, all SPACs are not the same, and it is critical to find the
right SPAC for your company. In traditional mergers, you seek out
business synergies. Here, you are looking for philosophical
alignment of long-term business goals. Ideally, you should find
SPAC sponsors who are backed by investors focused on your space,
will
