SEC Enhances SPAC-Related Requirements

The SEC has released a final rule that is designed to “enhance investor protections in initial public offerings by special purpose acquisition companies (commonly known as SPACs) and in subsequent business combination transactions between SPACs and private operating companies (commonly known as de-SPAC transactions).” Under the final rule, registrants are required to provide “enhanced disclosures about conflicts of interest, SPAC sponsor compensation, dilution, and other information that is important to investors in SPAC IPOs and de-SPAC transactions.” Further, registrants must disclose “additional information about the target company to investors that will help investors make more informed voting and investment decisions in connection with a de-SPAC transaction.”

For more information, see the press release and fact sheet — as well as the statements by SEC Chair Gary Gensler and Commissioners Hester Peirce, Caroline Crenshaw, Mark Uyeda, and Jaime Lizárraga — on the SEC’s Web site.