SPACs Face Potentially Sweeping Impact From SEC’s Accounting Guidance

专用习得公司的律师，会计师和赞助商正在支撑影响。

The potential effects of new SPAC guidance issued earlier this week by U.S. regulators are becoming clearer, and they could be sweeping. Lawyers who advice SPAC deals told亚博赞助欧冠that the new accounting guidance has already had an immediate impact, slowing deals as compliance teams meet to determine a path forward.

Top officials at the Securities and Exchange Commission on Monday issued a陈述警告说,一些无偿firms, called SPACs,may have failed to properly account for warrantssold or given to investors.

Warrants, which give some investors the right to buy more shares of the company at a preset price in the future, are a common instrument through which SPACs raise money, including from hedge funds and other early investors. SPACs are shell companies that trade on a stock exchange before merging with a private company to take it public.

SPACs have historically listed warrants as equity on their balance sheets. But the SEC’s acting chief accountant, Paul Munter, and the SEC’s top official for corporate filings, John Coates, said Monday that warrants should instead be classified as liabilities in certain situations, making the company account for adjustments in the warrants’ value over time.

It may seem an obscure issue, but the SEC officials warned that SPACs will have to re-state their financials, throwing a temporary wrench in one of the hottest investment markets of the past year. It’s still unclear exactly how many companies will have to do so, but lawyers who advice on SPAC mergers are already sounding the alarm that the new guidance is slowing down the SPAC market.

Davis Polk＆Wardwell，命名雷丁蒂夫作为基于联合交易价值的2020年的最高律师事务所，周三在A中表示客户的注意事项that the SEC guidance “has already caused a pause in offerings by SPACs.” The firm also said the change has delayed the completion of some SPAC mergers, but added that guidance likely won’t have a material impact on investors.

“We are not aware of other situations in the recent past where the SEC staff, with no notice or comment, simply issued a proclamation that had such a significant chilling effect on capital markets activities,” Davis Polk wrote in the note.

Ripple effects of the guidance have already been seen. BurgerFi, which went public through a SPAC in December,延迟收入周二，讲述投资者需要时间来确定证券委员会指引对其当前和以前财务报表的影响。

However, the SEC statement doesn’t appear to have erased investor appetite for SPACs. The day after the new SEC guidance was published, Southeast Asia’s largest ride-hailing and food delivery company, Grab,宣布计划去公众在最大的spac合并中。

[IIDeep Dive:Spacs可以免费提供IPO限制，可以使“荒谬”的金融预测 - 而这位对冲基金经理表示，辐射即将来临]

除此之外，SEC指导是“毫无疑问的市场下跌，”律师事务所Ellenoff Grossman＆Schole的合伙人Doug Ellenoff伙伴在电话采访中表示亚博赞助欧冠. “If deals don’t get processed effectively and efficiently, deals that are in process could not get done, which hurts public investors. There will be no quick fixes in my estimation.”

Ellenoff said law firms, accountants, and valuation firms are all meeting to determine precisely what the impact of the warrants guidance is and what needs to be done in response. He described the process as a “non-cash charge” and a “paperwork exercise.” Ellenoff said “the added pressure” from the SEC on the SPAC market is unnecessary and that the advisory firms and companies doing the deals are behaving responsibly.

“This is not a retail playground,” he said. “This is institutional investors, and they’re looking for return and now the SPAC market enables Fidelity and Wellington and T. Rowe, to invest in more interesting, pre-revenue, venture-like deals in the public market, so that they can compete with venture and private equity firms for return.”

认股权证不是唯一的问题，证券声称关注。上周监管机构发表了一份关于SPAC赞助商所作的潜在误导盈利预测的陈述，这表明证券交易所将为SPAC交易提供相同的审查。SPAC交易的一个优势在于它允许公司制作关于未来收入和收入的崇高预测。相比之下，通过IPO公开的公司通常不会在其主要文件中向未来进行预测，因为它达到了法律责任。

But Coates, the SEC official, put SPACs on notice, saying that the SEC will scrutinize future earnings projections made as a result of the deals.

“随着前所未有的潮流已经前所未有的审查，标准和创新的SPAC结构的新问题保持浮出水面，”凯斯表示。“关于SPAC参与者的减少责任曝光的任何简单索赔都是最佳的，并且在最坏情况下可能严重误导。”

Travis Wofford, a partner at Houston-based law firm Baker Botts, said the projections issue is likely more important, but the warrants issue is having a more immediate impact. He added that the upcoming May deadline for companies to file their quarterly reports is adding pressure for companies to resolve the warrants issue before then.