‘SPAC Winter’ Freezes Out Warrant Holders as Time Runs Out for Merger Deals
- Fervor wanes amid rush to find targets and bungled mergers
- Some would-be windfalls are on verge of becoming worthless
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Warrants tied to blank-check stocks are signaling deep doubts about whether those companies will find something to buy, and little or no relief for investors after a year-long rout that has gutted their holdings.
Traders have been dumping warrants issued by all types of special-purpose acquisition companies, with prices collectively down about 80% from a year ago, according to data from Boardroom Alpha. This includes SPACs that found a business to acquire as well as those that are still looking, and comes on top of a brutal 40% drop for a key SPAC stock benchmark.