Sep 21, 2021 - Economy

SPAC sweeteners are on the rise

SPAC IPO proceeds and anchor commitments
Data: SPAC Research; Chart: Axios Visuals

One byproduct of weakened demand for SPAC IPOs has been an uptick in sponsors getting anchor investors for their public offerings, often by offering them more favorable terms such as founder shares.

What’s happening: The trend continues. So far in September, anchor commitments represent more than half of all SPAC capital raised, per data from SPAC Research.

Why it matters: This trend has raised alarm bells for some investors as a sign of low-quality SPACs that need to use expensive sugar to sweeten the deal.

Yes, but: Depending on how it bears out in the long term, it could either become too unsustainable for SPAC sponsors or settle as the new status quo for some time.

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