HONG KONG: Asia’s bankers say they expect the hottest trend in global deal-making, IPOs for special-purpose acquisition vehicles (SPAC), to rocket in the region this year from small beginnings, fuelled by well-resourced investors including private equity firms.
Globally, SPACs raised US$92 billion (RM381 billion) from IPOs in first-quarter 2021, according to Refinitiv data, already surpassing all of 2020. SPAC mergers – when the blank check firm uses IPO funds to merge with a target – amounted to US$210 billion.
Raghav Maliah, co-head of M&A for Asia ex-Japan at Goldman Sachs, said the significant increase of Asia-focused SPAC involvement has been the most notable feature in the region’s M&A this year. First-quarter Asia M&A hit a three-year high of US$279.5 billion, up 37% year-on-year, Refinitiv data showed.
For example, India’s largest renewable energy firm ReNew Power, in which Goldman invested, in February agreed to go public through a merger with a SPAC.
Meanwhile Chinese ride hailing giant Didi Chuxing and its Indonesian counterpart Grab have held discussions about the SPAC merger option to go public, Reuters has reported.
Source: The Sun Daily
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