The Nasdaq Stock Market, Inc. said it plans to propose a rule change to list acquisition vehicles and subject them to its initial listing requirements as well as additional criteria developed specifically for these entities.
Acquisition vehicles, often known as special purpose acquisition vehicles, are companies which go public with a business plan to seek corporate mergers or acquisitions. In 2007 alone, more than 50 offerings by acquisition vehicles raised new capital exceeding $10 billion.
“Acquisition vehicles are an increasingly common capital-raising device,” said Bob McCooey, senior vice president, Nasdaq. “We believe that listing them on Nasdaq, subject to these important investor protections, will benefit investors and issuers alike.”
In addition to having to satisfy all applicable initial listing standards, Nasdaq will require that acquisition vehicles also meet additional criteria, including: proceeds from the initial public offering must be deposited in an escrow account maintained by an insured depository institution; within 36 months the company must complete one or more business combinations using at least 80% of the value of the escrow account; and, each business combination must be approved both by the company’s shareholders and by a majority of the company’s independent directors. Following each business combination, the combined company must meet all of the requirements for initial listing.
Nasdaq proposes listing standards for acquisition vehicles
Move will enhance protection and transparency in active market segment, exchange says
- By: IE Staff
- February 21, 2008 February 21, 2008
- 12:50