Zurich - SIX will be enabling and regulating financial vehicles known as special purpose acquisition companies (SPACs). These shell companies, solely founded for the purpose of acquiring a non-listed, private company, can be listed as of December 6.

Special purpose acquisition companies (SPACs) will be permitted on the SIX Swiss Exchange from December 6. According to an announcement by the SIX Swiss Exchange on Tuesday, it has developed a new listing standard specifically for these shell companies.

SIX allows listing of SPACs
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A SPAC is a shell corporation that is listed with the express aim of raising capital to purchase a private company (de-SPAC). The company is listed on the stock exchange within the context of the acquisition. Investors can use this financial vehicle to avoid a traditional initial public offering (IPO) and substantially simplify and expedite listing.

SIX has developed a new listing standard specifically for SPACs “in response to a regulatory need”. It principally corresponds to the same requirements as other standards for companies listed on the SIX Swiss Exchange. However, this standard is said to be adapted to the specific characteristics of SPACs. Furthermore, an “appropriate degree of investor protection” is guaranteed.

For example, a SPAC must disclose additional quantitative and qualitative information in the prospectus. Issuers of SPACs do not need to have annual financial statements for the three full fiscal years before the listing application. Additionally, the issue proceeds raised in an IPO must be deposited in an escrow account at a bank. Furthermore, in addition to members of the board of directors and management, sponsors and founding shareholders of the SPAC are also persons subject to reporting requirements. This means that they must disclose their management transactions.

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