ADVANTAGES OF A SPAC

SPAC BUSINESS COMBINATION

TRADITIONAL IPO

CASH SALE

PROCESS

• Merger with SPAC that results in the target becoming a publicly traded company

• Equity capital raise from public investors
• Typically primary issuance to fund future growth

• Sale of entire/partial equity stake to financial sponsor or strategic buyer

TIMING

• Certainty in as little as 4 weeks
• Closing in as little as 4 months

• Up to 12 months

• No minimum time requirements

BENEFITS

• Establishes public currency
• Target company will know valuation at the outset of process
• More streamlined process / less reliant on equity window than traditional IPO
• Able to use projections in marketing
• SPAC sponsor can shepherd target through going public process

• Establishes public currency
• Orderly trading post-IPO can support positive momentum

• Potential for full monetization
• More traditional transaction process
• Speed of execution

CONSIDERATIONS

• Investor turnover can create near-term pressure
• Can be dilutive

• Valuation uncertainty until pricing
• IPO windows can be unpredictable which may prevent ability to execute
• Expensive and lengthy process

• Limited potential for equity rollover
• Limits ability to participate in future growth
• More dependent on debt financing market conditions