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Illustration: Eniola Odetunde/Axios

There's been more than $125 billion in special purpose acquisition company, or SPAC, merger activity this year, more than quadrupling the 2019 total. And it's only expected to accelerate in 2021.

Driving the news: Three new SPAC mergers were announced in the past 24 hours, totaling over $3.6 billion, all in the vehicle space. Plus, nine new SPACs priced IPOs, raising a combined $2 billion.

The big picture: Both supply and demand are overflowing — hundreds of unicorns and even more near-unicorns with more than 225 SPACs are actively seeking targets.

  • Then throw in a deep-pocketed group of active PIPE investors, albeit a few who've gotten more selective of late, new SPAC formations each day, and a vibrant leveraged loan market.

What we don’t know is if this is sustainable.

  • Everyone’s jumping into the pool now, including VC firms in a show of buyout envy reciprocity, but this isn’t anyone’s core business — except, maybe, Michael Klein. If there’s some sort of regulatory crackdown from President-elect Biden’s SEC or a few big blowups scare off new investors from blank-check IPOs, then the SPAC market could shrink as fast as it expanded.
  • Bankers say they aren’t worried because there’s so much variety in what SPACs ultimately buy. And there’s some truth to that, but there’s been a very heavy concentration so far in the conceptual EV/AV space.

Between the lines: It's long been said that private markets follow public markets. In 2020, however, the reverse has been true.

  • Public equities investors act like venture capitalists, eschewing current fundamentals for five-year TAM projections.
  • And, with SPACs, they are buying into blank check structures that mimic buyout funds, albeit with worse LP economics and no portfolio diversity.

The bottom line: It's the new normal — for now.

Go deeper

Miriam Kramer, author of Space
Jan 26, 2021 - Science

Investment in the space industry overcame the pandemic's headwinds in 2020

A SpaceX launch in 2020. Photo: SpaceX

Investment in the space industry continued to grow in the last quarter of 2020, despite the coronavirus pandemic, according to a new report from Space Capital.

Why it matters: The space industry turned out to be far more robust in the face of the pandemic than many experts were initially expecting.

Scoop: Stephanie Ruhle to replace Brian Williams on MSNBC

Photo: Nathan Congleton/NBCU Photo Bank/NBCUniversal via Getty Images via Getty Images

MSNBC will soon announce plans to move morning anchor Stephanie Ruhle to the 11 pm ET hour that Brian Williams turned into an elite destination, two sources familiar with the move tell Axios.

Details: The 9 am ET hour, currently hosted by Ruhle, will become part of MSNBC's flagship morning show, "Morning Joe," which currently runs from 6 am to 9 am ET.

Oath Keepers leader denied bail on Capitol riot sedition charge

Oath Keepers co-founder Elmer Stewart Rhodes. Photo: Susan Walsh/AP

A federal judge ordered Oath Keepers leader Stewart Rhodes to remain jailed Wednesday until trial on charges stemming from the Capitol riot.

Why it matters: The judge said the most prominent far-right figure charged in the Jan. 6, 2021, insurrection had access to weapons and his alleged "continued advocacy for violence against the federal government" gave credence to prosecutors' view that, if released, Rhodes could endanger others.