Hailing from the US, the Special Purpose Acquisition Company (SPAC) is sweeping through Europe. Even if they raise questions, these investment vehicles could develop in the grand duchy.
SPACs are the latest investment fad. In 2020, 44 were created across the Atlantic for $78b raised. In the first two months of 2021, the Wall Street Journal identified 188 new ones which raised $50b. And the wave is starting to arrive in Europe, even in Luxembourg, where the first SPAC, Lakestar SPAC 1 SE, was approved last February and successfully floated on the Frankfurt Stock Exchange on 16 March.
The purpose of these structures? To carry out one or more acquisitions, then introduce the targeted companies to the stock market through a “merger” process with the company. This offers the advantage for the target company of being listed without going through the long and expensive administrative procedures required for any initial public offering (IPO).
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