Michael Dell, Paul Singer, Facebook co-founder latest to join SPAC bandwagon

[NEW YORK] Michael Dell, activist investor Paul Singer, Facebook co-founder Eduardo Saverin and former Xerox Corp chief Ursula Burns have all joined the blank-check parade on a single day.

Mr Singer's Elliott Management Corp, doubling down, filed for two new special purpose acquisition companies, or SPACs. In all, at least 13 of the blank-check companies filed Friday for US initial public offerings, seeking to raise a combined total of more than US$4.5 billion.

SPACs have come to dominate IPOs this year, accounting for 63 per cent of the almost US$77 billion raised on US exchanges, according to data compiled by Bloomberg. Including Friday's newcomers, 146 SPACs that have filed since Jan 1 are waiting for IPOs to add US$40 billion to that total, the data show.

The vehicles, which hold an IPO and then merge with a private company seeking to go public, have become so numerous that serial filers are putting in for two or even three on the same day. On Friday, that included two SPACs backed by Cantor Fitzgerald - its seventh and eighth - in addition to Elliott's double play.

High-profile investors such as Bill Ackman, whose US$4 billion listing by Pershing Square Tontine Holdings in July ranks as the biggest-ever SPAC, have helped inspire a phalanx of followers. This month, financier Michael Klein added US$1.68 billion with two additions - his sixth and seventh - to his blank-check collection. The following day, Vinod Khosla's namesake venture capital firm beat Klein on deal count, with three SPACs pricing on one day to raise a total of US$1.2 billion.

Then there are SPACs backed by celebrities and politicians, ranging from former National Football League quarterback Colin Kaepernick and retired New York Yankees player Alex Rodriguez to former House Speaker Paul Ryan and former Commerce Secretary Wilbur Ross.

The new SPACs filed Friday include: MSD Acquisition Corp, backed by billionaire Michael Dell's MSD Partners, filed to raise US$500 million to focus on targets in high-growth sectors including technology and media. Mr Dell, founder of computer-maker Dell Technologies, is a strategic adviser. Gregg Lemkau, MSD Partners CEO and a former co-head of investment banking at Goldman Sachs Group, is the CEO.

Elliott Opportunity I Corp is seeking to raise US$1 billion, while Elliott Opportunity II Corp is targeting US$500 million. Both count Jesse Cohn and Gordon Singer as co-chairmen. Mr Cohn and Mr Singer - the son of Elliott founder Paul Singer - are managing partners at the activist investment firm.

B Capital Technology Opportunities Corp, backed by Saverin's B Capital Group, is seeking to raise US$300 million. Mr Saverin will serve as a special adviser to the company, with fellow B Capital Group co-founders Howard Morgan as chairman and Raj Ganguly as CEO. The SPAC will focus on targets with a "core technology focus" in four sectors: consumer enablement; financial services; health and wellness; and industrial and transportation.

Plum Acquisition Corp 1's backers include Ms Burns, who will be executive chairwoman and a director. Her lengthy resume includes currently serving on the boards of Uber Technologies Inc. and Exxon Mobil Corp. Plum is planning to raise US$300 million and seek a merger candidate with "distinct machine learning and AI-driven advantages." Plum joins Queen's Gambit Capital, which raised US$345 million in its January IPO, as one of the few SPACs led by women.

BLOOMBERG