SPAC
a.k.a. Special purpose acquisition company, Blank-check company
A shell company that lists on the stock market with no business, raising money to buy a private company later.
A SPAC (special purpose acquisition company) is a company with no operations, just a pot of cash and a promise. It lists on an exchange, raises money from investors, and then has a deadline, often two years, to find a private company to merge with, taking that company public through the back door.
SPACs exploded in 2020–2021 and many of the companies they took public later fell sharply. If no deal is found, investors usually get their money back. Fees and incentives for the sponsors are worth reading carefully.
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