Quote:
Originally Posted by Krovikan
In a non-WSB discussion, has a SPAC vote like AMCI ever failed? It seems like it'd be really counterproductive to shareholder value to reject this deal.
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Yes, SPAC deals regularly fail. Or at least they used to before say 3 months ago.
Not on the vote though. They fail because too many people redeem and there isn't enough money left in trust for the deal to be worth it for the target company.
So the number one predictor is what the share price of the spac is. Because if its greater than the trust value (usually $10 and change) then its not rational to redeem, you would just sell instead.
Historically predicting this has been down to the penny. Like, "based on current t bill rates trust value should be $10.27, it's holding at $10.28 so the deal should pass."
Now that $10 in cash minus fees is worth $14 or so, they'll all pass.
Predicting whether it will pass used to be lucrative for me, because you could buy cheap warrants if the deal was going to pass and the market thought it wouldn't. I'm basically out of SPACs now though other than some low risk options trades to capture unreasonable levels of volatility.