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SPAC Boom Creates Fresh Targets for Short Sellers, Activists

Blank-check deals help businesses go public faster, and that has investors who hunt weak companies getting ready to pounce.

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Illustration: Nichole Shinn for Bloomberg Businessweek

When Genius Sports Ltd. merged with a blank-check company earlier this year, it became part of the the hottest trend on Wall Street this side of meme stocks.

Its deal to combine with the publicly traded DMY Technology Group Inc. II was a relatively easy way for the then-private Genius to list its shares on the New York Stock Exchange. The newly merged company adopted the Genius Sports name while inheriting DMY II’s public status. That was the entire point of DMY II’s brief existence: As a special purpose acquisition company, it was essentially a corporate shell founded in 2020 to search for and buy a business. SPACs are also known as blank checks, since investors initially put their money in without knowing what business the company will buy.