ANALYSIS: Fortunes of SPAC, Traditional IPOs Diverge in Pandemic

The fortunes of SPAC initial public offerings ascended while traditional IPOs slumped during the initial three months of the pandemic-induced downturn.

The months of March, April, and May saw SPAC IPOs (IPOs of special purpose acquisition companies) largely reach or exceed parity with traditional IPOs in deal count and deal value. The IPO market returned to its usual patterns in June.

This astounding development reflects essential differences between traditional IPOs and the IPOs of SPACs.

What Made SPACs So Attractive?

Traditional IPOs are typically completed by businesses, usually start-ups, with track records of performance and several years of ...