SPACs, otherwise known as blank-check companies, were once a popular, though controversial, way for companies to go public.
As the Financial Times (FT) reported Sunday (May 18), SPACs have seen a resurgence recently, with 44 SPAC offerings raising $9 billion so far this year, compared with 57 companies raising $9.6 billion during the entirety of 2024.
The landscape for SPAC advisers is changing, too, the report added. In 2021, banking giants like Credit Suisse, Citi and Deutsche Bank were some of the busiest SPAC advisers. Now, the sector is dominated by lesser-known outfits such as Cohen & Company Capital Markets, D. Boral Capital, Clear Street and Maxim Group.
The blank check craze saw roughly 600 U.S. companies raise a record $163 billion in 2021, the report added. The fever broke when global stocks plunged in 2022 as interest rates climbed.
The listing method also caught the attention of regulators, with the Securities and Exchange Commission (SEC) — under the leadership of former chair Gary Gensler — aligning the rules for mergers of companies with listed SPACs with those for standard IPOs, the report added.
However, investors expect more leniency under the SEC’s new chair, Paul Atkins, who was nominated by Trump.
Among companies planning to go public via SPAC is Twenty One Capital, a new bitcoin firm planning a $3.6 billion blank check merger. The company is headed by Brandon Lutnick, son of Commerce Secretary Howard Lutnick.
“There’s been a reordering of the deck chairs since the Gensler era,” Matthew Michel, founder and managing partner at InvestorLink Capital Markets, told the FT.
“When the SEC targeted SPAC by creating an uncertain regulatory environment, the big banks moved to idle their SPAC origination businesses,” Michel said. “This shift cleared the way for smaller players to fill the void.”
The report noted that Trump administration has also paved the way for the SPAC revival in another way: by instituting tariffs that have shaken up the stock markets and caused some companies to rethink their IPO plans.
“2025 was meant to be the year of the IPO,” said Brandon Sun, head of SPAC investment banking at Cohen & Company. “Given the volatility resulting from Trump’s tariff policies, those hopes have been dashed and crushed. The opportunity for SPACs is pretty incredible.”
“IPOs are not the destination, but they are a massive capital formation moment,” QED Investors Partner Amias Gerety said in an interview with PYMNTS last month.
“It empowers companies that go public, allowing them to be more aggressive, to acquire companies, hire more, and lower their cost of capital. All these benefits are going away.”
