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SEC Proposes New Rules For SPACs That Would Heighten Disclosure Standards
Summary: The Securities and Exchange Commission(SEC) has proposed new rules and amendments to disclosure standards for special purpose acquisition companies (SPACs). The new SPAC rules would significantly heighten disclosure standards for the process, making the SPAC process closer to the IPO process. SPACs expedite the process to going public and have become a popular fundraising route. ...
The Securities and Exchange Commission(SEC) has proposed new rules and amendments to disclosure standards for special purpose acquisition companies (SPACs). The new SPAC rules would significantly heighten disclosure standards for the process, making the SPAC process closer to the IPO process.
SPACs expedite the process to going public and have become a popular fundraising route. The proposal would require similar financial statement requirements to an IPO involving a public shell company and a private operating company. It must be disseminated to investors 20 days before a vote to approve the transaction. Any sale of a non-shell company to a shell company’s shareholders would be subject to the Securities Act.
It also creates a safe harbor for SPACs currently in progress that meet certain disclosure requirements. Gensler said in a statement that the proposal stems from the understanding that functionally, SPACs are being used as an alternative to a traditional IPO.
By Amy Liu
Tags: IPO,SEC,SPACs
Link: SEC Proposes New Rules For SPACs That Would Heighten Disclosure Standards [Copy]
