SPAC

SPAC, or Special Purpose Acquisition Company, is created to raise capital through an initial public offering (IPO) to acquire or merge with an existing operating company. The funds raised from the IPO are held in a trust until a suitable target company is identified and the acquisition or merger can occur. SPACs have recently gained popularity as an alternative method for companies to go public. Instead of going through the traditional IPO process, a company can partner with a SPAC and merge with it, effectively taking the SPAC's place as a publicly traded entity. This approach allows the company to access public capital markets more quickly and with less regulatory scrutiny than a traditional IPO.