Welcome to the Capital Note, a newsletter (coming soon) about finance and economics. On the menu today: SPACs, Office Space, and Antique Bonds, plus some links from around the Web.
Special purpose acquisition companies (SPACs) are all the rage. 51 SPAC offerings have been completed in 2020 — a 145 percent increase from the same period in 2019. Electric-truck company Nikola and spaceflight company Virgin Galactic both went public this year via SPACs, and Bill Ackman — enjoying the limelight after a stunningly profitable short trade early in the COVID crisis — has launched his own “unicorn mating dance,” his term for the process of finding a large tech company to take public with $4 billion in newly raised funds.
A SPAC represents a “blank check” for a sponsor, who raises capital in the public equity markets and uses it to merge with a private company.