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SportsBusiness: Sports-Related SPACs Rise in ProminenceOctober 08, 2020
O’Melveny Sports Industry Group co-chair Chuck Baker discussed the rising popularity of SPAC deals, and their appeal with sports team owners in this SportsBusiness article.
The publication noted that SPAC deals have quadrupled since 2019, and nearly US$54 billion has been raised in the US through SPACs in 2020 to date. “It’s sort of the flavor of the year, and an easy way to raise capital,” Baker said. “A lot of folks are obviously tapping into the public markets as a quick, efficient way to raise that capital.”
2021 and 2022 will be significant years for SPAC issuers, as investors will expect acquisition targets to be determined, the article reported. For sports teams, European ownership rules are usually more lenient than in the United States, which has made them one prominent target. However, Baker noted that American sports franchises will be considerably more problematic within this structure. “Teams here don’t set themselves up as well with public ownership,” Baker said. “But there are a lot of other assets out there that would be terrific as public entities.”
SportsBusiness subscribers can read the full article here.