Chamath Palihapitiya to wind down SPAC deals
Yahoo Finance Live anchors discuss Chamath Palihapitiya winding down on SPAC deals amid the IPO slowdown.
Video Transcript
JULIE HYMAN: All right, rising rates and inflation are hurting the SPAC markets. SPAC king Chamath Palihapitiya now winding down two of his special acquisition companies, looking to return cash to shareholders after failing to find companies to take public. His deal making prowess also under scrutiny as companies that he did take public in earlier deals, like Virgin Galactic and SoFi, they're down big for the year, causing serious losses for some of his followers.
Other notable SPAC creators like Bill Ackman have also closed up shop amid the market turmoil. So this is just another sign of what we were talking about with Brianne a little bit ago that there is just this drying up of desire for companies to go public, whether it's through a SPAC or through an IPO or direct listing or what have you.
BRAD SMITH: Well, part of it is going back to the investors and saying, here is the company that we are presenting to you for the part of this dSPAC so that we can actually make sure that the shell that's already begun trading publicly is now-- is setting forth, or at least following through, on what we had intended in this acquisition. And the problem is that so many of the private companies that are themselves looking for capital for those investors are not viable enough opportunities--
[BUZZER]
--for growth for them to rally around. And for some of them, that means that they would also pull their money out of it, too.
JULIE HYMAN: You got buzzed, Brad.
