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Chris Bryant

Why a $33 Billion SPAC Deal Couldn’t Pay Its Bankers

MSP Recovery was short of cash, so it stuck its advisers with an IOU.

In this photo illustration the stock trading graph of MSP
Photographer: SOPA Images/LightRocket

MSP Recovery Inc. was valued at almost $33 billion prior to going public last month, making the healthcare-litigation company the most expensive US SPAC deal ever, at least on paper. The excitement didn’t last.

MSP is now worth a more modest $4.3 billion after the shares collapsed more than 85% since its blank-check merger closed and regular trading began, and the drama didn’t end there. Just days after listing, MSP warned its ability to continue as a going concern was in substantial doubt. Nomura Holdings Inc. and Keefe, Bruyette & Woods Inc. (a Stifel Financial Corp. subsidiary) accepted $45 million in promissory notes – IOUs to you and me – in lieu of their advisory fees, because MSP lacked cash to pay them.