Deconstructing SPACs in Corporate and Finance Law

The Finance, Law and Economics Working Group is glad to invite you to a webinar with Dr. Daniele D'Alvia on Specified/Special Purpose Acquisition Companies (SPACs). Dr. D'Alvia is one of the few world leading experts on SPACs and he will critically analyse this last Wall Street Trend, which has been gaining incredible interest in the financial sector, especially during the COVID-19 crisis.

ABSTRACT
As of July 31st, SPACs make 37.5% (56 out of 149) of the total IPO market in 2020, obtaining $22.5 billion in financing.
A Specified/Special Purpose Acquisition Company (SPAC) is a cash-shell company set up with the sole purpose of carrying out an acquisition. SPACs issue units composed of common shares and warrants through an initial public offering (IPO). IPO funds are deposited in an escrow account. Subsequently, they are released once the SPAC finds out the right opportunity for a business combination (generally within 24 up to 36 months, depending on the Exchange and the jurisdiction on which the SPAC is listed). In case of failure of a business combination, the SPAC is liquidated, and funds held in trust are returned to investors. The month of July was an example of their growing importance. The average SPAC size also increased over the years. In 2007, the average size of a SPAC IPO was $183 million, by 2019, the average size has increased to $228 million, and this year the average is about $394 million. Recent years have seen a dramatic increase in the number of SPAC deals, suggesting that SPACs are finally being recognized as alternative investment vehicles to traditional IPO.
This happened in a year with an unprecedented fall in economic activity of 32.9% in the second quarter, caused primarily by COVID-19.
Why are SPACs finally getting their share of attention?

SPEAKER'S BIO
Dr. Avv. Daniele D’Alvia has been a visiting lecturer at Birkbeck University of London since 2014, where he acts as the module convener of Comparative Law and Islamic Finance. He has also been a visiting lecturer in Islamic Finance at the International Chamber of Commerce in Rome since 2018, and a Teaching
Associate at Queen Mary University of London in 2019, where he works with Prof. Rodrigo Olivares Caminal (Chair in Banking and Finance). Formerly, he held the position of visiting lecturer and module convener of International Finance and Company Law at the University of Hertfordshire for the academic year 2017-2018.
Dr. D’Alvia is a pioneer in the studies on Special Purpose Acquisition Companies (SPACs). Indeed, the academic literature on the topic is still scant, and scholars as well as the financial industry are very much in need of a regulatory framework for such investment vehicles. Since 2014 Dr. D’Alvia has published intensively on the subject and he is now leading research projects on SPACs both at the Institute of Advanced Legal Studies as an associate research fellow and Harris Manchester College (Centre for Commercial Law) University of Oxford as a visiting fellow in order to design a possible model of regulation
for SPACs. He was a visiting scholar at the Max Planck Institute for Comparative and International Private Law in Hamburg (April -June 2017), a Ronnie Warrington Scholar at Birkbeck College with his doctoral research titled ‘Risk, Uncertainty, and Finance: Special Purpose Acquisition Companies as self-regulation instruments’. In 2017 a research piece on SPACs written by Dr. D’Alvia was awarded the prestigious Colin B. Picker Prize by the American Society of Comparative Law. He is a Bloomberg Contributor and his articles on SPACs have appeared on Bloomberg Law, Il SOLE 24 ORE, ICC Forum Italia, Financial
Mirror, Ekathimerini Cyprus, etc. as well as top peer reviewed journals such as the Journal of Banking Regulation.