The SEC proposed a crackdown on blank-check companies known as SPACs. SPACs have no business operations — their only purpose is to acquire a private firm to then list on a stock exchange, allowing that firm to bypass a costlier initial public offering.
The Securities and Exchange Commission on Wednesday proposed a crackdown on blank-check companies known as SPACs, looking to give investors the power to sue if they’re presented with too rosy a picture about future financial gains.
“If it quacks like a duck, and it SPACs like a duck, we should treat it the same,” SEC Chair Gary Gensler told reporters after the commission approved the proposal for aLawmakers and consumer advocates have increasingly raised alarms about the risks facing unwitting investors, particularly retail buyers who they worry might not be able to spot a bad deal on their own.
Still, this method of going public more quickly remains a viable option for some companies. Republican SEC Commissioner Hester Peirce warned in a dissenting statement that the proposal “seems designed to stop SPACs in their tracks.” SPACs would also need to disclose more about the entities that are putting together the deal, including their compensation and any conflicts of interest, according to. They would also have to give investors more information about what would happen to their shares if they follow through on the acquisition; SPAC insiders can often profit even when the final deal isn’t great for other shareholders.
México Últimas Noticias, México Titulares
Similar News:También puedes leer noticias similares a ésta que hemos recopilado de otras fuentes de noticias.
SPACs’ problems are bigger than the governmentThe SEC wants to clamp down on blank-check firms’ rosy projections when touting deals. But the headiest days of the party are already over: Activity is down, broken deals are up, and big names have run aground. No matter what, SPACs will have a harder time from here on out.
Leer más »
SEC Unveils New SPAC Rules Targeting 'Unreasonable' Financial Projections And Requiring More DisclosuresSPAC stocks have plunged some 33% over the past year, while the S&P 500 has climbed 17%.
Leer más »
Elon Musk cites Eminem song in latest volley with the SECThe Tesla CEO says his free speech is being suppressed.
Leer más »
Grayscale gears up for legal battle with SEC over Bitcoin ETFThe SEC has twice delayed Grayscale Investments' application for a Bitcoin ETF, now the digital asset manager is gearing up for a legal fight if its ETF is rejected by the regulator.
Leer más »
SEC Charges Twilio Engineers With Insider Trading During Early Days of PandemicThree Twilio software engineers, who had access to customer usage databases, passed confidential information along to friends and family members.
Leer más »