IAS Gyan

Daily News Analysis

Special purpose acquisition company  

20th December, 2021 Economy

Figure 4: No Copyright Infringement Intended


  • Byju’s may follow in the footsteps of ReNew Power to list in the US through the special purpose acquisition company (SPAC) route.

About SPAC:

  • A special purpose acquisition company (SPAC) is formed to raise money through an initial public offering (IPO) to buy another company.
  • At the time of their IPOs, SPACs have no existing business operations or even stated targets for acquisition.
  • Investors in SPACs can range from well-known private equity funds and celebrities to the general public.
  • SPACs have two years to complete an acquisition or they must return their funds to investors.
  • It is a shell corporation listed on a stock exchange with the purpose of acquiring a private company, thus making it public without going through the traditional initial public offering process.