The SPAC boom over the past year is beginning to deflate, as issuances slow down and investors sell-out of post-merged companies that are well below their $10 IPO price.
The Defiance Next Gen SPAK ETF is down more than 22% year-to-date, and down more than 37% from its mid-February high. High profile SPAC names like 23andME, Blade Air Mobility, and MetroMilehave plunged at least 25% from their $10 IPO Prices.
The broad decline in the stock prices of companies that went public via SPAC is partly due to poor fundamentals, with some being pre-revenue companies, and most not yet profitable. As these companies first quarterly earnings report as a public company begin to trickle in, investors are heading for the exits.
This trend could continue and ultimately spill over into SPAC listings that have not yet completed a merger, as they trade closer to the $10 IPO price.
That's because the often 2-year deadline for hundreds of SPACs to complete a deal is not far away as management teams scramble to find a deal. Those deals will likely be of sub-par quality given the many hundreds of SPACs that are desperate to get a deal done and get paid before they have to return the funds raised to investors.
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These are the 10 worst performing SPACs that completed their merger over the past year.
Ticker: UK Market Value: $90.8 million % Below $10 IPO Price: -90%
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