Analysis: U.S. companies snub SPACs amid concerns they cannot deliver

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Advertising technology firm Simplifi Holdings was ready to go public last month at a valuation of close to $2 billion when some investors balked.

The Fort Worth, Texas-based company was seeking to raise around $300 million in financing for its merger with D and Z Media Acquisition CorpDespite assurances from bankers at Goldman Sachs Group Inc

Simplifi is among dozens of companies that dealmakers say have canceled or reconsidered their plans to go public through mergers with SPACs in the last few weeks. They are concerned that PIPE investors are no longer flocking to what was until recently one of Wall Street's hottest trends. "PIPE investors have really put on the brakes in recent weeks and are focusing on more quality opportunities," said Amir Emami, global co-head of SPAC Coverage at RBC Capital Markets.

Some 30 companies have agreed to merge with SPACs since the beginning of April, compared with 69 during the February-March period, when the SPAC boom hit a peak, according to data vendor Refinitiv.

 

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this is terrible news

SPACs are the new .com bubble. It's a Ponzi scheme.

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