What’s a SPAC? - Raiz Invest

Have you seen this acronym floating around financial media in 2021? It’s becoming more and more prominent when it comes to takeovers and listings, particularly in the US markets.

It stands for Special Purpose Acquisition Company. Here are some of the things you need to know about SPACs and how they operate.

 

Why are SPACs set up?

SPACs are setup with the intention to buy another company. They are listed on a US exchange, raising a significant amount of money for the purpose of buying another company within the next two years. A SPAC has no actual business operation to speak of until they purchase an operational company.

 

Who can invest in a SPAC?

Investors in SPACs can range from reputable private-equity funds to everyday investors.

 

How long does a SPAC have to make an acquisition?

If a SPAC does not complete an initial public offering (IPO) in two years, it must return money to its investors. A SPAC is therefore motivated to hustle and find a suitable company to take to the public markets.

 

Acorns is being listed on the Nasdaq via a SPAC

Acorns, the company that Raiz originated from via a Joint Venture, is soon to go public on the Nasdaq in the US via a merger with Pioneer Merger Corp (PACX). PACX is the SPAC being used to bring Acorns to the market, and the new ticker code will be OAKS when it lists later in 2021. Acorns’ CEO believes that going public will help elevate their story, introduce many more people to the power of compounding and financial wellness, and bring financial literacy to the mainstream. Spactacular!

 


 

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Important Information

If you have read all or any part of our email, website, or communication then you need to know that this is factual information and general advice only. This means it does not consider any person’s particular financial objectives, financial situation, or financial needs. If you are an investor, you should consult a licensed adviser before acting on any information to fully understand the benefits and risk associated with the product. This is your call but that is what you should do.

You may be surprised to learn that RAIZ Invest Australia Limited (ABN 26 604 402 815) (Raiz), an authorised representative AFSL 434776 prepared this information.

We are not allowed, and have not prepared this information to offer financial product advice or a recommendation in relation to any investments or securities. If we did give you personal advice, which we did not, then the use of the Raiz App would be a lot more expensive than the current pricing – sorry but true. You therefore should not rely on this information to make investment decisions, because it was not about you for once, and unfortunately, we cannot advise you on who or what you can rely on – again sorry.

A Product Disclosure Statement (PDS) for Raiz Invest and/or Raiz Invest Super is available on the Raiz Invest website and App. A person must read and consider the PDS before deciding whether, or not, to acquire and/or continue to hold interests in the financial product. We know and ASIC research shows that you probably won’t, but we want you to, and we encourage you to read the PDS so you know exactly what the product does, its risks and costs. If you don’t read the PDS, it’s a bit like flying blind. Probably not a good idea.

The risks and fees for investing are fully set out in the PDS and include the risks that would ordinarily apply to investing. You should note, as illustrated by the global financial crisis of 2008, that sometimes  not even professionals in the financial services sector understand the ordinary risks of investing – because by their nature many risks are unknown – but you still need to give it a go and try to understand the risks set out in the PDS.

Any returns shown or implied are not forecasts and are not reliable guides or predictors of future performance. Those of you who cannot afford financial advice may be considering ignoring this statement, but please don’t, it is so true.

Under no circumstance is the information to be used by, or presented to, a person for the purposes of deciding about investing in Raiz Invest or Raiz Invest Super.

This information may be based on assumptions or market conditions which change without notice and have not been independently verified. Basically, this says nothing stays the same for long in financial markets (or even in life for that matter) and we are sorry. We try, but we can’t promise that the information is accurate, or stays accurate.

Any opinions or information expressed are subject to change without notice; that’s just the way we roll.

The bundll and superbundll products are provided by FlexiCards Australia Pty Ltd ABN 31 099 651 877 Australian credit licence number 247415. Bundll, snooze and superbundll are trademarks of Flexirent Capital Pty Ltd, a subsidiary of FlexiGroup Limited. Lots of names, which basically you aren’t allowed to reproduce without their permission and we need to include here.

Mastercard is a registered trademark and the circles design is a trademark of Mastercard International Incorporated.

Home loans are subject to approval from the lending institution and Raiz Home Ownership makes no warranties as to the success of an application until all relevant information has been provided.

Raiz Home Ownership Pty Ltd (ABN 14 645 876 937), an Australian Credit Representative number 528594 under Australian Credit Licence number 387025. Raiz Home Ownership Pty Ltd is 100% owned by Raiz Invest Australia Limited (ABN 26 604 402 815).

(ABN 26 604 402 815).


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