The IPO Buzz: Back from the Dead

One was priced last week. Another is on the launching pad for this week. But the story dates back to the beginning of the year.
The SPAC offerings got off to a fast start. By Feb. 27, 11 of the year’s first 20 IPOs were “blank check” offerings, according to the U.S. Securities and Exchange Commission’s filings.
Then the curtain came down.
Over the last three months, the IPO SPAC market dried up. And the financial press has had a good time beating up on the SPAC sector, but not the bankers.
For them, the drumbeat of new SPAC filings continued.
By Friday, May 16, the IPO Pipeline had swollen to 82 SPACs looking to raise $15.3 billion, up from 62 SPACs aiming to raise $10.2 billion on Feb. 27.
Then on Friday came the debut of the first SPAC to go public since Feb. 27.
China Fundamental Acquisition (OTCBB: CFQF.OB), priced 3.75 million units at $8 each to raise $30 million on Thursday evening, May 15. And guess what? It was a successful launch. The deal closed Friday, its opening day, at $8.20 per unit, UP 2.5 percent from its initial offering price.
Give Me Liberty
This set the stage for this week’s IPO calendar and another SPAC.
Liberty Lane Acquisition (Nasdaq: LLACU proposed) plans to offer 35 million units at $10 each to raise $350 million. Each unit will consist of one share of common stock and one-half of one warrant. The deal is expected to trade on Friday, May 23.
Passing note of interest: This will be Goldman Sachs’ first SPAC and only the second time that a SPAC unit will be offering half a warrant.
Now back to this week and the balance of the calendar.
MFResidential Investments (NYSE: MFR – proposed) is the only other deal slated to go public. The company is a New York City-based REIT recently formed to invest primarily, on a leveraged basis, in residential mortgage-backed securities, residential mortgage loans and other real estate-related financial assets. The deal is expected to trade on Wednesday, May 21.
However, there’s more to the SPAC story than the two above. A couple of bankers have indicated they might have a SPAC on the forward IPO calendar in a week or two. So stay tuned.