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Spacs and Their Role in the M&A Market

When you talk about merger and acquisition, we tend to believe that every aspect and spare of this transaction is related to the seller and the buyer and most importantly the Business Brokers.

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Spacs and Their Role in the M&A Market

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  1. Spacs and Their Role in the M&A Market When you talk about merger and acquisition, we tend to believe that every aspect and spare of this transaction is related to the seller and the buyer and most importantly the Business Brokers. What we fail to understand is that an m and a deal is incomplete without proper understanding of the gravity of the matter. When we say gravity of the matter, we tend to focus on the minute details at each level of completion of this deal because each aspect calls for attention when it comes to both the parties and the intermediate. On that note, it can clearly be said that the role of special purpose acquisition companies have not only been a great help, but also a catalyst in closing some promising deals in emerging markets like automotive. SPACs AND THE AUTOMOTIVE MARKET

  2. As we all know for a fact that the automotive market is at a boom since the past few years. That’s why any news of an enormous deal closing could be something that we all expect, but the fact that influential SPACs are participating in the deals first-hand. If we take a look at the recent merger of Luminar and Gores Metropoulos, we can see how both the parties engaged into what they thought would be a revolutionary deal. The mooted valuation, that exceeded $3 billion, shows us just how useful a SPAC or an investment vehicle can be. If we observe this deal closely, we can see how skilfully an investment vehicle can be put forward when it has a significant expertise in the market and has a vision of growing in the long term. WHAT DOES THE FUTURE OF THE MARKET INDICATES? When we speak about automotive markets, we can see how effortlessly driverless cars became so important that every other conglomerate, be it Alec Gores of Gores Group and Gores Metropoulos who merged with Luminar, or Jeff Bezos of Amazon, who merged with Zoox. Therefore, it would be safe to admit that everything boils down to closing the best deal which not only creates a pool of new opportunities for other players, but also educates them about important aspects like How to Value a Business. And when SPACs and other investment vehicles are involved, it can be seen

  3. that such influential closings fuelled up other players to open up to such opportunities. HOW SPACs MADE THEIR WAY THROUGH If we consider every aspect of the M&A market, we can say that completion of every activity is focused primarily on getting a lot of cash in return. This is the main reason why investment vehicles and specifically SPACs have been gaining so much importance. Luminar is surely the latest addition in the list but the past years witnessed many deals which involved electric cars and automated vehicles in particular. According to a report published by FT, it is said that SPACs can move quickly and can bring a lot of cash that may not be so easily available in the traditional IPO market. That's why the special purpose acquisition companies have started merging with influential companies like Nikola, Fisker Automotive, Velodyne Lidar, Hyliion, and Lordstown Motors. All of these companies have pending or closed deals with such investment vehicles that exceeded up-to three times of their current valuation. it can be seen that in a way all of these companies are mentioning that it is just a matter of time bad this kills to derive that would showcase how beneficial The Deals are going to be. it is also a relief for many investors who earlier were sceptic about getting into a deal with an inexperienced player of a market. THE BIGGER PICTURE AND A HINT OF OPTIMISM

  4. If we take a look at the current reports we can say that every company that has been hired by a special purpose acquisition company has seen a significant growth in their share prices just after their deal was announced. Out of all the companies that are mentioned above Nikola is the only one that has closed its deal with its respective SPAC. but this isn't lesson formation to rely on and base the fact that the special purpose of acquiring companies has boosted up all the transactions and made it possible for both the parties to execute such a deal when no one can ask How to Sell a Business or anything related to the basics of it. it would also be beneficial for the newer players to get along with SPAC and its role in the market. and one every player understands the same question of how to value a business would be nothing but a resolved issue. On a concluding note, we can just agree on the fact that sometimes, it’s just about looking at the upsides of helping tools like investment vehicles and SPAC. If you found this analogy helpful, and what to check out more, you can look up Rocky Mountain Business Advisors online, but if you’re looking to experience our consultation first-hand, you can reach out to us at 303-474-5582 and book your session today. Connect with us today and allow the best business brokersto solve your issues.

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