Posts Tagged ‘SPACs’

SGX: Private equity to the rescue?

In Uncategorized on 04/05/2010 at 5:16 am

Last week tuesday, we reported SGX’s boast that MNCs wanted to list here.

SGX had also (FT reported) said that it was also expecting a flow of listing applications for Asian companies controlled by western private equity firms.

“We are getting more inquiries all the time,” he said. “Many of the private equity firms . . . need to find an exit. It has been three or four years since many of these investments, so now is a logical time for them [to come to the market] … Singapore had identified “a strong pipeline” of potential initial public offerings from China.

Add to that, the Special Purpose Acquisition Companies’ (SPACS’) IPOs that SGX wants to attract here, and one reasonably suspect that private equity is being looked upon as SGX’s saviour from the mediocrity of a second class exchange

A special purpose acquisition company (SPAC) is an investment vehicle that allows  investors to invest in private equity type transactions via a listed vehicle. SPACs have no operations but are listed with the intention of merging with or acquiring a company with the proceeds of the SPAC’s IPO.

Note in the US, SPACs have been used to buy Chinese and Indian businesses, allowing them to get listed in the US.