THE 3 recently listed Special Purpose Acquisition Companies (SPACs) have generated “strong interest” and raised a total of initial public offering (IPO) proceeds of about S$528 million, leading Singapore’s IPO market to its busiest half year in five years, according to a PwC Singapore report released on Tuesday (Jun 28). 

The listing of Vertex Technology Acquisition Corporation marked the largest local IPO in the first half of 2022 after raising S$208 million, followed by Pegasus Asia and Novo Tellus Alpha Acquisition raising S$170 million and S$150 million respectively.

PwC noted that this highlights a positive trend of SPAC IPOs “successfully” making their debut on the Singapore Stock Exchange, after the SPACs came under a framework introduced by Singapore’s exchange in September 2021.

The report found the broader IPO market in Singapore for the first half of 2022 to be “strong” despite the global economic situation including the war in Ukraine, supply chain disruptions and a tight labour market. 

The geo-political instability has not affected the Singapore IPO market in the short term - with 10 new IPOs in the first half of 2022 compared to 3 in the same period last year. The total funds raised also increased from S$0.34 billion in the first half of 2021 to S$0.57 billion in the first half of 2022. 

The Singapore Exchange, which ended the first quarter of 2022 with a 9.6 per cent gain, will continue to be “attractive and a listing destination of choice” for companies across niche sectors including real estate, healthcare and consumer discretionary.

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The bullishness was echoed in the regional bourses, where the gradual opening of the economies in the first half year of 2022 led to an increase in capital markets activities in the regional bourses, with Indonesia and Thailand leading in terms of IPO proceeds raised and IPO volume.

PwC observed that investors are becoming more selective and price sensitive due to the geo-political situation. 

Additionally, the report found that US-listed companies with sizeable Chinese operations may face “significant” risks due to higher scrutiny and new measures by the US Securities and Exchange Commission (SEC) to implement the Holding Foreign Companies Accountable (HFCA) Act.

PwC highlighted that this may increase the risk of US listed companies with significant operations in China exiting the US capital markets. 

However, this may benefit the Singapore market and other regional stock exchanges as this risk could see these US-listed companies seeking alternative fund-raising platforms, according to the report.