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The fast track IPO – Success factors for taking firms public with SPACs

Douglas Cumming (), Lars Helge Haß and Denis Schweizer

Journal of Banking & Finance, 2014, vol. 47, issue C, 198-213

Abstract: Special Purpose Acquisition Companies (SPACs) are shells initiated with the sole intent of acquiring a single privately held company. SPAC shareholders vote on this acquisition, and in this paper we identify the factors that affect approval probability. Surprisingly, the data indicate more experienced managers and boards do not enhance the probability of deal approval. Similarly, glamor underwriters and larger underwriter syndicates are less likely to be associated with successful SPACs. Further, we find a negative relation between the presence of active investor (hedge funds and private equity funds) shareholdings in a SPAC and approval probability.

Keywords: Special Purpose Acquisition Company (SPAC); Ownership structure; Board structure; Voting (search for similar items in EconPapers)
JEL-codes: G12 G24 G34 (search for similar items in EconPapers)
Date: 2014
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Handle: RePEc:eee:jbfina:v:47:y:2014:i:c:p:198-213