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What is a spac?
Blank-check companies, also known as special-purpose acquisition companies (SPACs), are shell vehicles without assets or operating businesses, which fundraise through an IPO (typically at $10/share) for yet-to-be-named acquisitions. Like a direct listing, an acquisition or merger by a publicly traded SPAC is an alternative for a private company to go public without the uncertainty and hoopla of an IPO. They have drawn regulatory scrutiny because they don't require as much diligence as a traditional IPO and have drawn companies in higher-risk sectors, creating risks for inexperienced investors.