Special Purpose Acquisition Companies (SPACs)

Latham draws on elite capital markets, M&A, private equity, public company representation, and tax capabilities to guide clients through the entire SPAC life cycle.

Why Latham

SPACs Explained

Investors and sponsors with an industry focus are increasingly forming special purpose acquisition companies (SPACs) as an alternative way of raising funds, through an initial public offering, prior to buying an operating company. SPAC management teams typically target an industry or sector, but not a particular company, before IPO. Once a SPAC goes public it has a set timeframe — usually 18 to 24 months — to use its funds to acquire a target (de-SPAC), or else return the funds to its investors.

The SPAC structure represents a careful balance between investor protections and an effective acquisition tool — providing benefits to investors, sponsors, and sellers of target businesses. The video below explains how SPACs work.

Why SPACs Are Increasing in Popularity

SPACs represent an alternative to the traditional IPO, offering a source of financing and an efficient route to go public that may be a better fit for certain companies. SPAC IPO pricing is often simpler on the front end because the value of a SPAC’s shares is equal to the money in its trust. Credible sponsors with significant assets under management are increasingly executing larger SPAC IPOs and de-SPAC transactions, successfully acquiring significant operating businesses in the process. Price discovery takes place between the SPAC and target business during the de-SPAC transaction, providing an equally, if not more insightful pricing process than that of a traditional IPO.

Latham’s Seamless SPAC Capabilities

Latham is especially well-positioned to guide SPACs throughout their life cycle. Successful SPAC transactions require careful planning and execution, from formation, to IPO, the subsequent business combination, and then onto life as a public company. Our SPAC team leverages Latham’s elite capital markets, M&A private equity, public company representation, and tax capabilities to deliver seamlessly coordinated, full-service advice and representation to SPACs, their sponsors, underwriters, and M&A participants. We couple our SPAC advice with deep industry-specific knowledge and complementary practice support to provide unparalleled insight and commercially focused counsel.

 

Our Experience

Awards & Rankings

  • Latham Named 2021 Capital Markets Group of the Year - February 09, 2022
  • Latham Named M&A Group of the Year - January 24, 2022
  • Latham Wins Several 2021 New York Legal Awards - September 19, 2021
  • Lisa Nguyen and Shagufa Hossain Named Asian Leaders Worth Watching - June 28, 2021
  • Latham & Watkins Named Capital Markets Law Firm of the Year - June 02, 2021

#1 SPAC M&A Sell-side Adviser
SPACInsider | H1 2021


#1 SPAC M&A Adviser
SPACInsider | H1 2021


#1 All US IPOs, 2015 - Present
IPO Vital Signs

Events

2021 Pickering Energy TE&MFest

Media Coverage

SPAC-Related Enforcement and Litigation: What to Expect in 2022Capital Markets Group Of The Year: LathamMergers & Acquisitions Group of the Year: Latham

News

Latham & Watkins Advises 10X Capital in its US$1.25 Billion Business Combination with PrimeBlockLatham Represents Ligand in Spin-off of OmniAb BusinessLatham & Watkins Advises HUB Cyber Security (Israel) Limited in its US$1.28 Billion Business Combination with Mount Rainier Acquisition Corp.

Thought Leadership

Delaware Court Applies Entire Fairness Standard to MultiPlan de-SPACSPAC-Related Litigation Risks and Mitigation Strategies SPAC-Related Litigation Risks and Mitigation Strategies – Five Key Takeaways

Webcasts & Podcasts

Exit This Way – Alternative & Traditional Paths to Going Public: A Closer Look at SPACSExit This Way – Alternative & Traditional Paths to Going Public: IPOs, Direct Listings & SPACsPwC Panel Event: Planning and Executing a Successful IPO