Going Public During a Pandemic: SPACs vs IPOs

The listing of a company through a Special Purpose Acquisition Company (SPAC) can offer several benefits compared to the traditional IPO process. However, there is no evidence on whether macroeconomic factors affect the choice between SPACs and IPOs. To fill this gap, we study a global sample of 7,953 observations over 18 years, finding that the share of SPACs is negatively correlated with long-term interest rates. We also found that market sentiment has a strong positive impact on the share of SPACs, while market performance and market development do not have a significant effect. During the pandemic, listing with a SPAC was more likely, as companies prioritised speed and took advantage of market opportunities, particularly in the Technology and Healthcare sectors.