Harry Sloan and Jeff Sagansky drop company SPAC IPO plans

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April 6 (Reuters) – Blank check firm Spinning Eagle Acquisition Corp, backed by former Hollywood execs Harry Sloan and Jeff Sagansky, on Wednesday requested withdrawal of its initial U.S. public offering of up to $2 billion. dollars.

The Special Purpose Acquisition Company (SPAC), which in June last year increased its offering by $1.5 billion, did not disclose the reason for the withdrawal.

Spinning Eagle joins a slew of companies that have canceled deals this year at a time when U.S. market volatility surged on fears of rising rates, geopolitical tensions and a sell-off in tech stocks.

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Last year, another blank check vehicle backed by Sloan and Sagansky agreed to take biotech company Ginkgo (DNA.N) public at a $17.5 billion valuation. Ginkgo shares have lost more than 50% of their market capitalization so far this year.

Investor sentiment around the alternative route to listing that had taken Wall Street by storm in 2020, has recently seen a decline in interest and increased regulatory scrutiny after the shares of several companies that merged with the SPAC after their IPO.

The US securities regulator recently unveiled a new draft rule that would require SPACs to disclose more details about their quotes, in a bid to prevent companies from releasing overly optimistic earnings projections. Read more

A SPAC is a publicly traded company with no commercial activities but raising funds with the aim of merging with a private company and taking it public.

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Reporting by Manya Saini in Bangalore; Editing by Shailesh Kuber

Our standards: The Thomson Reuters Trust Principles.

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