Taking that point a step further is the slowdown in special-purpose acquisition companies, or SPACs.
The proposed changes that came from the SEC late last month weren’t unexpected to many in the industry.
In general, the commission and Chairman Gary Gensler have been rather public about scrutinizing blank-check companies more closely.
However, what makes the SEC’s proposal a bit more unexpected is that it comes as the SPAC market has already cooled dramatically.
The SEC proposal includes the removal of the safe harbor for forward-looking statements.
Although many companies consider SPACs as a vehicle to go public, a merger with one is actually an M&A deal, DuClos points out.
While liability issues and the safe harbor removal are seen as the keys to the proposed changes, there are other significant changes.
The effective result is that a fairness opinion will be included with every deSPAC deal.
However, while many expect the commission to enact some of the proposals, they also expect some changes in what was released in March.
Kelly thinks the SEC would like to get rules in place by the fourth quarter.
“If approved as is, you’ll see very few SPACs in the future.