In Vogue Again: The Re-Rise of SPACs in the IPO market

62 Pages Posted: 14 Apr 2021 Last revised: 19 Sep 2021

See all articles by Maria Lucia Passador

Maria Lucia Passador

Harvard University - Harvard Law School; Bocconi University - Department of Law; Universite du Luxembourg - Faculty of Law, Economics and Finance

Date Written: April 4, 2021


Were we to distill 2020 into a single word, from the capital markets’ perspective at least, it would certainly be SPACs, which – although to a different extent – are now having their momentum on both shores of the pond. If, in the US, SPACs are really enjoying a new lease of life due to the pandemic, as if they were Charon ferrying markets through the darkest of waters, although they are not comparable to what happens across the Atlantic, data in Europe seem to be growing steadily.

This article focuses on SPACs in the US pre-COVID scenario (between January 2010 and December 2019), in order to understand their structural changes over the years and the grounds for their recent resurgence. Firstly, it aims to identify the length and profitability of such an investment phenomenon and understand the behavior of institutional investors in this context. Then, the possible investment shifts in the sector of SPACs, driven by the 2020 post COVID bubble, are analyzed, relying on data retrieved from different providers and players, and specifically focusing on three main current concerns: the increasing litigation phenomenon, the (resulting) increase in D&O insurance costs, and the engagement of PIPEs as guarantors of the soundness and of the successful outcome of the transaction.

Undoubtedly, in the near future, US SPACs will hold a foreground role, not plunging back into the shadows (or even worse into the darkness that they had been living in for years), and will certainly be able to update and evolve for good, as they showed themselves capable of doing in the past, thereby overcoming problems and perplexities raised about them.

Keywords: SPACs, blank check companies, IPO market, private equity, business combination

JEL Classification: F30, G12, G14, G15, G24, G30, G32, G34, K22

Suggested Citation

Passador, Maria Lucia, In Vogue Again: The Re-Rise of SPACs in the IPO market (April 4, 2021). University of Chicago Business Law Review, 2022, forthcoming: Bocconi Legal Studies Research Paper No. 3820957; University of Luxembourg Law Working Paper No. 2021-005, Available at SSRN: or

Maria Lucia Passador (Contact Author)

Harvard University - Harvard Law School ( email )

1563 Massachusetts Avenue
Cambridge, MA 02138
United States

Bocconi University - Department of Law ( email )

Via Roentgen, 1
Milan, Milan 20136

Universite du Luxembourg - Faculty of Law, Economics and Finance ( email )

4, rue Alphonse Weicker - C221A
Luxembourg, L-2721

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