Comments on: The Great SPAC Scam: Why SPACs Are a Great Deal for Celebrity Sponsors, But Not Companies or Normal Investors

By: M&I - Brian

M&I - Brian — Fri, 17 May 2024 23:39:46 +0000

In reply to PAUL R. TAYLOR. I am not a legal expert or capital markets lawyer, so I can't comment on those, sorry. This site deals with finance and financial analysis, not the legal side of deals.

By: PAUL R. TAYLOR

PAUL R. TAYLOR — Fri, 10 May 2024 18:04:38 +0000

Brian
I wonder if i can pick your brain on two things;
1) Why is it that a deSPAC cannot use an S3 registration statement post despac for 12 months (?)

2) Why is a deSPAC unable to issue restricted shares under rule 144 ?

TIA

By: M&I - Brian

M&I - Brian — Wed, 22 Nov 2023 16:41:25 +0000

In reply to Frank. Sorry in the sense that he likely joined the company partially because of the expected value of these shares, which ended up being worthless. Sure, he didn't "lose" anything directly, but he still may have made a bad employment decision because of this.

By: Frank

Frank — Sat, 18 Nov 2023 15:07:10 +0000

In reply to M&I - Brian. Why sorry for him? He spent zero penny for that virtual $100k warrant.

By: M&I - Brian

M&I - Brian — Thu, 31 Aug 2023 01:04:25 +0000

In reply to Kevin English.

That is true, but we covered this point in other SPAC coverage on this site:

https://mergersandinquisitions.com/spac-vs-ipo/

By: Kevin English

Kevin English — Thu, 24 Aug 2023 23:13:03 +0000

You missed a key reason why SPACs under perform — really reverse mergers in general. They are used because the company that wants to be public doesn’t have good enough numbers to go public on the merits of their current balance sheet. You are starting with a lemon that couldn’t pass the scrutiny required to undergo the traditional approach to going public.

By: M&I - Brian

M&I - Brian — Wed, 14 Jun 2023 19:29:26 +0000

In reply to Kal. Sorry to hear that. We do try to warn people about scams and unscrupulous deals and other activities on this site, but it doesn't always get circulated widely...

By: Kal

Kal — Mon, 12 Jun 2023 08:07:15 +0000

In the case with Sharecare, a company where I was an employee, your comments regarding SPACs rings true. I am not an educated investor, only an employee who received a decent amount of shares that were worth over 100k on day 1 of their going public. It’s been a year or so now since opening at $10 /share and they have ‘tanked’ as you put it probably due to the market not liking the deal. If I had known about the SPAC SCAMS prior to Sharecare going public, I’d have my 100k.. Right now I don’t think there’s enough in my account to tip the mailman for Christmas. Thanks for the article.

By: M&I - Brian

M&I - Brian — Tue, 01 Mar 2022 15:33:53 +0000

In reply to Alan De Anda. I can't really say because I haven't followed SPACs in other markets/regions. But I think whenever you have an instrument that gives one set of investors a huge advantage over everyone else, there's the potential for trouble. So this answer depends heavily on how SPACs are implemented elsewhere, and whether the same terms exist there.

By: Alan De Anda

Alan De Anda — Fri, 25 Feb 2022 00:36:36 +0000

Hi, Brian.
Thanks for such useful article. I work in a shopping center firm in Mexico, which in 2020 was the first company in the country to go public through a SPAC, just in time to be our life jacket for covid. Since I was aware of the implications of our SPAC proccess, I thougth of his pitfalls and the moral risks involved. Fortunatelly, at this day, none of the investors nor sponsor had withdrawn, even with covid severe troubles.
Do you think SPAC malpractices in US will inherently be repeated in other markets like Mexico? Is the SEC turning a blind eye on that malpractices?

Kind regards,