The Singapore Exchange (SGX) will allow special purpose acquisition companies (SPACs) to list in our country, with effect from 3 September 2021.
This makes SGX the first major stock market in Asia to offer SPAC listings.
The announcement from the Singapore stock exchange comes after a month of public consultation at the end-March of this year.
Here’s what you should know SGX’s new SPAC framework in under 60 seconds!
A Primer About SPACs
SPACS are “blank cheque” shell companies designed to take private companies public without going through the traditional initial public offering (IPO) process.
The main advantage of a SPAC transaction is that a private company can become a listed company with more certainty and control over its pricing and deal terms compared to the traditional IPO route.
Once the funds are raised, the SPAC’s management team (referred to as sponsors) has a fixed timeframe to “de-SPAC”, which is to identify a target company and complete the acquisition.