Questions about SPACs.
21 answers about the structure itself, worked against the 239 SPACs covered here rather than a textbook example. Questions about this site are answered on the home page.
The basics
What is a SPAC?
A company that raises money on a public exchange before it has a business, then goes looking for one to buy. No revenue, no operations, no target named — the sponsor is asking you to fund the search. If they find something and shareholders approve it, the SPAC becomes that business. If they do not, the money goes back. The 239 SPACs covered here hold $40.5B raised between them, at a median of $200M each.
The SPAC lifecycle →What am I actually buying at $10?
In the IPO, a unit: one share plus a fraction of a warrant, and sometimes a right. 231 of the 239 SPACs here sold units at exactly $10.00, which is the market convention rather than a rule. Almost the whole $10 goes straight into a trust account holding short-dated government paper. The share carries a claim on that trust; the warrant carries a bet on a deal that has not been found yet.
What is the difference between the share, the warrant and the unit?
They are three separately traded securities in the same SPAC. The unit is what the IPO sold and it splits — typically about 52 days after listing — into its parts. The share holds the redemption right and behaves like cash until a deal appears. The warrant is a right to buy a share later at a fixed price, usually $11.50, and it is worth nothing unless a deal closes and the stock runs well past that. A ticker with a suffix is usually one of these other legs rather than the share itself.
Shares, Units, Warrants, Rights →Who is the sponsor and what do they get?
The team that forms the SPAC, funds its costs and hunts the deal. For that they take founder shares — the promote — typically around 20% of the post-IPO share count, bought for a nominal amount. They are paid in ownership of whatever they find, and they are paid nothing if they find nothing, which tells you a great deal about what a sponsor is motivated to do as the deadline approaches.
The trust
Where does the money actually sit?
In a trust account, invested in short-dated Treasuries, held by a trustee and not spendable on the sponsor's costs. It can be released for exactly two things: paying redeeming shareholders, or funding a combination that shareholders have approved.
What is trust value per share, and why is it not the market price?
The cash in trust divided by the public shares that can claim it. It is what a redeeming shareholder receives, in cash, and it moves only with interest earned and taxes paid out of the account. The market price is a separate thing: what someone will pay you today for the claim, the warrant attached to it and the wait. The two are usually close before a deal is announced and can diverge violently after.
Does the trust grow over time?
Yes, slowly. It holds Treasuries, so it earns interest, and trust per share drifts up over the SPAC's life — a trust funded at $10.00 is worth more than $10.00 a year later. Tax on that interest is usually paid out of the account, so it grows a little slower than the headline yield.
What am I paying for if I buy above $10?
The deal, not the cash. 195 of the 239 SPACs here last closed above $10.00 and 37 below it, with 80 within a dime either way. Above trust value you are paying a premium for whatever the market thinks the sponsor will find, and that premium is the part with no floor under it.
Every SPAC →The clock
How long does a SPAC have to find a deal?
Whatever its charter says — commonly 18 to 24 months, and lately often 12 months with the option to buy more time in monthly increments. There is no standard figure, which is why the deadline is worth reading rather than assuming. Across the covered set the median SPAC has been searching for 10 months and 46 are past 18 months.
The SPAC lifecycle →What is an extension and what does it do to me?
A vote to move the deadline, usually paid for by the sponsor depositing more money into the trust. It also opens a redemption window: holders who do not want to wait can take trust value in cash at that vote. Extensions are routine, and they routinely see most of the trust walk out the door — which shrinks the SPAC and changes the arithmetic of any deal that follows.
What happens if it never finds a deal?
It liquidates. The trust is divided among the public shares and paid out in cash, generally within a couple of weeks of the deadline. Founder shares and every warrant expire worthless. For a shareholder who bought at or below trust value, that outcome is not a loss — it is the structure doing what it says.
When a deal appears
A deal was announced. What happens now?
The SPAC files an 8-K with the agreement and usually a presentation, then works through a merger proxy that shareholders vote on — typically three to six months later. Signed is not closed: deals are terminated between announcement and vote often enough that the discount to trust value is a live judgement rather than free money.
The SPAC lifecycle →How do I redeem, and by when?
You submit a redemption election through your broker before the deadline in the merger proxy — typically two business days before the meeting, and brokers impose their own cutoff a day or two earlier again. It is the single most missable date in the structure. Redeeming is separate from voting: you can vote for the deal and still take your cash, and voting against it redeems nothing on its own.
What is a PIPE and why should I care?
A private placement that closes alongside the combination — outside investors putting new money in at an agreed price, often on better terms than the public got. It matters because it is the cash that replaces whatever the trust loses to redemptions, and because its price is a second, more informed opinion on what the target is worth.
What does it mean when redemptions are high?
That most of the money left. A deal can close with the great majority of the trust redeemed, so a business announced against a $200M SPAC can arrive public with a small fraction of it. The share count barely falls in proportion, because the sponsor's founder shares and the target's stock are unaffected, so the remaining holders own a company with far less cash than the announcement implied.
Dilution
Why do people complain about the promote?
Because it is roughly a fifth of the company for a nominal payment, and it converts into ordinary stock when a deal closes. Redeeming shareholders never feel it — they take trust value and leave. Everyone who stays owns a smaller share of whatever was bought, and the sponsor's stake cost them nothing to acquire.
I only own shares. Do warrants still affect me?
Yes. Every warrant is a claim on stock that does not exist yet, exercisable at a fixed price once the deal is done. If the share price runs, those warrants convert and your ownership is diluted at a price below the market. The overhang is disclosed from day one and is part of the cost of the structure, whether or not you hold any.
What about rights?
Some SPACs attach a right to each unit — a fraction of a share, delivered free when a combination closes. It is a small sweetener that dilutes on the same day it pays, and it trades as its own line once the unit separates.
Judging one
Is a pre-deal SPAC a low-risk holding?
Before a deal is announced, a SPAC bought at or below trust value is closer to a Treasury bill with an option attached than to a stock — which is why 80 of the 239 covered here last closed within a dime of $10.00. The risk is not usually the trust; it is the price paid above it, the time the money is locked up, and the decision about whether to stay in when a deal finally arrives.
Every SPAC →What should I read before holding one?
The charter deadline and how many extensions are already built into it; the trust balance per public share from the latest 10-Q; the size of the promote; and how many warrants and rights are outstanding. Four figures, all of them filed, and together they explain most of what happens to a SPAC shareholder.
The SPAC lifecycle →Why is trust per share missing from your screener?
Because it comes out of each SPAC's own filings and this site will not print a figure it has not read off one. Total assets from a data vendor is not the same number — for a SPAC that listed this quarter the last filed balance sheet predates the trust entirely — and dividing it by shares outstanding would produce a confident, wrong answer. It reads N/A until the filings pipeline lands.
Every SPAC →Educational only. Nothing here is a recommendation to buy or sell anything, every answer is general, and every timing described is a market convention that a particular SPAC's charter is free to contradict. Market figures are as at 2026-08-14. See the disclaimer.
Then look at where each one stands.
Every listed SPAC with what it raised, when the clock started, and where it trades against its $10 issue price.