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The Rise of Fintech and Healthcare SPACs

In: Essays on Financial Analytics

Author

Listed:
  • Victoria Patsika

    (Cardiff Business School, Cardiff University
    Department of Accounting and Finance, University of Macedonia)

Abstract

This study examines the level acquisition companies (SPACs). The results demonstrate low underpricing for both types of SPAC, with unit and share prices of around $10 from 2010 to 2021. Leverage, market capitalisation, the size measured by total assets, and management teams with finance experience have a statistically significant impact on underpricing. Interestingly, the management team affected the share price (closing price) when the SPACs merged with the target companies on the first trading day. SPACs appear to be an alternative in comparison with IPOs. Furthermore, the relevance of agency theory, information asymmetry theory, signalling theory, and the winner’s curse is confirmed. The results provide practical implications for private target companies and investors that are interested in SPACs.

Suggested Citation

  • Victoria Patsika, 2023. "The Rise of Fintech and Healthcare SPACs," Lecture Notes in Operations Research, in: Pascal Alphonse & Karima Bouaiss & Pascal Grandin & Constantin Zopounidis (ed.), Essays on Financial Analytics, pages 265-296, Springer.
    • Handle: RePEc:spr:lnopch:978-3-031-29050-3_13
    DOI: 10.1007/978-3-031-29050-3_13
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