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U.S. SPACs with a focus on China

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  • Shachmurove, Yochanan
  • Vulanovic, Milos

Abstract

This paper examines the value implications of remedial actions taken by the Securities Exchange Commission (SEC) during 2011 that culminated in delisting a number of Chinese companies from United States public exchanges. To achieve that we examine the institutional characteristics and performance of Specified Purpose Acquisition Companies (SPACs) used as a financing tool and gateway to the U.S. capital markets by Chinese companies in period 2004–2011. Evidence shows that SPACs merging with companies from China are not inferior in corporate structure when compared with other SPACs. While their institutional characteristics are similar, the performance tests indicate that Chinese SPACs lose value around SEC decision dates, but in overall they outperform other SPACs listed in the U.S.

Suggested Citation

  • Shachmurove, Yochanan & Vulanovic, Milos, 2017. "U.S. SPACs with a focus on China," Journal of Multinational Financial Management, Elsevier, vol. 39(C), pages 1-18.
  • Handle: RePEc:eee:mulfin:v:39:y:2017:i:c:p:1-18
    DOI: 10.1016/j.mulfin.2016.12.001
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    References listed on IDEAS

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    More about this item

    Keywords

    Blank checks; China; Chinese reverse mergers; SEC; SPAC; Specified purpose acquisition companies; Spillover;

    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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