UK regulator to consult on changing rules for SPACs (updated)

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31/03/2021 07:41

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    By Rachel Armstrong and Abhinav Ramnarayan
    LONDON, March 31 (Reuters) - Britain's financial regulator
said on Wednesday that it is to consult on changes to its
listing rules for Special Purpose Acquisition Companies (SPACs),
following a recommendation from a review commissioned by UK
finance minister Rishi Sunak.
    The Financial Conduct Authority said it will consider
introducing a minimum market capitalisation and a redemption
option for investors as the UK tries to attract some of these
so-called "blank cheque" companies to list in London. 
    "Our proposals will help to ensure that SPACs operate within
a framework of high regulatory standards and oversight", the
regulator said in a statement, adding that the consultation will
run for four weeks. 
    Britain has missed out on the record wave of SPAC listings
that have taken place globally, particularly in the United
States, where 522 such listings have raised over $300 billion in
2020 and 2021, according to data compiled for Reuters by
Refinitiv.  urn:newsml:reuters.com:*:nL1N2LM0F1
    There have only been 10 SPAC listings in Europe in 2020 and
2021, with a total value of about $1.3 billion, and none in
London, where the rules are perceived as off-putting. European
SPACs have so far chosen to list in Amsterdam or Paris. 
    As part of a wider drive to attract more tech companies to
the London Stock Exchange, a recent review of listing rules by
former EU Commissioner Jonathan Hill recommended bringing rules
in the UK closer in line to the United States on SPACs. 
    The review recommended that the UK regulator requires
trading to be suspended in the shares of SPACs on announcement
of a potential acquisition, and to allow for a shareholder vote
and redemption rights.

 (Reporting by Rachel Armstrong and Abhinav Ramnarayan; Editing
by Dhara Ranasinghe)
 ((rachel.armstrong@thomsonreuters.com; +44 207 5423365; Reuters
Messaging: rachel.armstrong.thomsonreuters.com@reuters.net))