Street Calls of the Week
Investing.com -- Goldman Sachs Group Inc. (NYSE:GS) has decided to re-enter the special-purpose acquisition company (SPAC) market, ending a self-imposed ban that began three years ago when regulatory scrutiny increased.
The investment bank will now consider underwriting new SPAC deals, evaluating each potential transaction individually, according to Bloomberg, citing sources familiar with the decision. Goldman may restrict which SPAC sponsors it partners with as part of this cautious return to the market.
This marks a significant shift from the bank’s 2022 position when it stopped working with most SPACs it had previously taken public and halted all new U.S. SPAC issuance. Typically, a bank continues advising a SPAC after its initial public offering to help complete its merger with a target company, known as a de-SPAC transaction.
SPACs, or blank-check companies, experienced tremendous popularity during the post-pandemic market boom. These investment vehicles attracted various high-profile individuals from finance, politics, and entertainment who saw opportunities to generate substantial returns from eager investors.
The SPAC boom ended abruptly when market conditions deteriorated, affected by tighter regulations and declining stock prices of companies that went public through SPAC mergers.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.