35 days ago • Posted by Charles-Henry Monchau
Hot SPAC market could freeze after potential SEC Rule change
According to Bloomberg, The SEC last week began privately telling accountants that warrants, which are issued to early investors in the deals, might NOT be considered equity instruments, but may need to be classified as liabilities;
The communications mean that filings for new SPACs may not go forward until the warrants issue is addressed;
Moreover, SPACs that are already public and that have struck mergers with targets may have to restate and refile their full slate of financial statements;
Some experts suspect this is likely just the tip of the iceberg and that "the SEC has intentionally created confusion in the industry to temporarily slow the soaring SPAC market".
Source: Forbes, www.zerohedge.com, Image The Street.com