SPAC to media’s rescue
Providing an exit to investors is taking precedence over fixing a broken business model for many new media companies.
Why read this story?
Editor's note: The West is awash with news of several media companies finding redemption in a SPAC outcome. SPAC is short for a special purpose acquisition company, also known as a blank cheque company or a company that has no real, existing business. Where the SPAC raises money through an initial public offering with the purpose of acquiring an existing company. The public markets in the US are in the middle of a SPAC boom of sorts. According to Dealogic, a data intelligence company, SPACs raised $83 billion in the first three months of 2021, compared to $82.6 billion raised in all of 2020. Also, SPAC IPOs comprised over 50% of all IPOs in the US in 2020, the highest number on record so far. All sorts of companies who’d otherwise take longer to list, because of the onerous requirements of a traditional IPO, are now doing so through the SPAC route. Not many of them are successful companies. Here is also where the media companies come in. Especially those that have raised venture capital and are under pressure from investors to …
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