Refuge of ‘chancers’: Spacs draw criticism from big investors

Poor disclosure, sub-par returns and share dilution are highlighted as risks of so-called ‘blank-cheque’ companies


Institutional investors are distrustful of special-purpose acquisition companies (Spacs) which they say encourage immature businesses to go public too soon, and lack the due diligence associated with traditional listings.

Some fear that the runaway growth of these funding vehicles is masking patchy returns on newly purchased companies, and that “deal fever” may tempt sponsors into rash acquisitions.

Steve Russell, co-manager of the £3.6 billion ($5 billion) LF Ruffer Total Return Fund, says

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