(Bloomberg) -- The blank-check market is heating up after the largest month for related initial public offerings since 2022, with a mix of new and experienced sponsors pricing new deals and a rush of additional debutants expected to come.
Avi Katz’s GigCapital Global, which has closed five deals, raised $200 million while Howard Lutnick and Asia casino magnate Lawrence Ho’s family office each priced their own offerings last month. All told, some $2 billion was raised across nine US-listed special-purpose acquisition companies in August, the biggest flow of deals and proceeds since early 2022, data from SPAC Research show.
Cantor Fitzgerald LP, where Lutnick is CEO, has been a key player in the SPAC space as a bank and backer, sponsoring at least nine blank-check companies, the data show. Rumble Inc., the Peter Thiel-backed conservative video network, is among the companies Cantor brought public through SPACs, though most of the stocks have slumped since debuting.
Black Spade Acquisition II Co., which raised $150 million, is sponsored by an affiliate of Ho’s Black Spade Capital. The firm’s first SPAC brought Vinfast Auto Ltd. public at a $27 billion valuation last year.
“The SPAC structure isn’t being put on the shelf — companies are realizing that the IPO may not be for everyone,” said Josef Schuster, founder and chief executive officer of IPOX Schuster, an index provider focused on new listings. “Smaller deals in riskier areas or larger industrial mergers make sense as companies look for a public listing.”
After a blockbuster year in 2021, with celebrities and athletes promoting blank-check offerings, the SPAC market hit a wall. More than 350 SPACs had to shutter and return cash to investors after failing to complete a successful transaction. It was part of a broader downturn in equity-related deals caused by a confluence of factors including rising interest rates, disruption in the tech sector and an unsteady outlook for stocks.
But the market has started to turn around this year, with seasoned sponsors and management teams raising fresh funds and finding new targets. August had $2.1 billion worth of SPAC IPOs, the largest amount since February 2022, SPAC Research data show.
There are now roughly 100 blank checks on the hunt for deals after 20 debuted in the past three months, SPAC Research data show. That’s down from a peak of more than 600 pre-deal vehicles in the go-go days of SPACs, but many companies that went public during that manic period have faltered. More than one-fifth of the nearly 500 SPAC deals that have closed since 2019 are trading below $1 each, a greater than 90% plunge, data compiled by Bloomberg show.
Still, there are some deals getting announced and completed for SPACs that raised millions during the boom times.
For instance, Concord Acquisition Corp II, backed by former Barclays Plc CEO Bob Diamond, unveiled plans last week to take event-management platform Events.com public. Oklo Inc., an advanced nuclear systems developer backed by Sam Altman, and Lionsgate Studios Corp., which merged with former Hollywood executive Harry Sloan’s SPAC, became public companies in May.
Other serial sponsors that have raised new SPACs since the start of May include James Graf, who leads Graf Global Corp., Mark Gerhard and Michael Klein. The track record for deals completed by their blank checks have been spotty, with a 97% plunge for Multiplan Corp. among the worst performers.
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