EU Watchdog Warns Investors Of Risks In SPAC Deals
Law360, London (July 15, 2021, 3:46 PM BST) -- Special purpose acquisition companies might not be suitable for inexperienced investors, Europe's markets watchdog warned on Thursday, as it pointed to gaps in disclosures about target companies, potential conflicts of interest and other risks.
The European Securities and Markets Authority said that investors should be cautious about pouring cash into the entities, better known as SPACs, because of a lack of requirements on what they must disclose. SPACs — or "blank check companies" — are formed solely to raise capital during an initial public offering and then acquire an existing business that wants an alternative way to get listed on a...
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