Going public with a SPAC has been saved
Going public with a SPAC
Is a SPAC right for you?
Chances are you navigated to this page because you are considering executing a merger with a special purpose acquisition company (SPAC). Or maybe you want to learn more about these types of mergers. Either way, you’ve come to the right place. Deloitte has a dedicated SPAC practice with experienced specialists who can advise you on the nuances of using a SPAC to go public. Read on for valuable resources designed to educate you on the SPAC merger process.
How Deloitte can help
Deloitte’s SPAC services team has advised companies around the world and helped them successfully navigate the SPAC lifecycle—from pre-deal preparation through execution and post-IPO services.
“Deloitte advised us through the execution phase of our SPAC transaction. It was clear they have the experience, industry knowledge, and a deep network within their organization. They were an important advisor to our team.”
— Drew Labenne, CFO, Bakkt
“Having the Deloitte Advisory team was an invaluable element of our very complex SPAC execution timeline. They continued to assist us in our transition to operating as a public company and were ready to deploy experienced M&A resources immediately following our public entry. Their deep network of skilled professionals was an absolute necessity for us as an innovative company looking to execute strategy quickly and efficiently.”
— Elvia Cowan, Vice President, Controller, 23andMe
“[The day we rang the bell on the NYSE] was my proudest moment as a CFO. I’m very grateful to have had the support and celebrate with some of the critical members of the Deloitte team that helped make this possible. Deloitte provided me and the company with outstanding client service. OUTSTANDING JOB & WOW TO A SPECTACULAR GROUP OF PROFESSIONALS!!!”
— Barry Lederman, Chief Financial Officer, Perimeter Solutions
The differences between going public via SPAC merger and a traditional IPO
Understanding the SPAC lifecycle
- Identify lead investment and M&A lawyers
- Develop forecasting model, develop story, and evaluate your company’s valuation
- Meet with potential SPAC suitors to gauge SPAC bake-off
- Identify an advisor to project manage the process and help develop the deal timeline
- Begin preparing Reg S-X/Reg S-K public company financial statements and footnotes and hire an auditor to perform an audit under PCAOB standards
- Begin tax planning strategies
Letter of Intent (LOI)
- Negotiate key deal terms, including earnout arrangements
- Agree on merger timeline with SPAC, advisors, and external auditors based on critical workstreams
- Conduct employee education and communication around the SPAC transaction and around being a public company
Private Investment in Public Equity (PIPE)
- Prepare PIPE presentation, including Key Performance Indicators (KPIs), identiﬁcation of non-GAAP measures and reportable segments
- Facilitate diligence review by prospective PIPE investors
- Negotiate PIPE terms with potential investors
- Obtain deﬁnitive commitments for the PIPE concurrent with the execution of the business combination agreement (i.e., combined public announcement), if possible
SEC reporting considerations
- Analyze accounting treatment to determine accounting acquirer
- Determine accounting for existing share- based awards, convertible equity and debt, etc. and any related impacts based on deﬁnitive merger agreement
- Draft MD&A and market risk disclosures
- Prepare Form S-4/proxy information, including pro forma ﬁnancial information for minimum and maximum redemption scenarios
- Respond to SEC comments and ﬁle Form S-4/A
Thriving as you transition from going public to being public
- Optimize finance and accounting operations to meet SEC reporting timelines
- Implement new technologies (e.g., Workiva, Blackline, NetSuite, etc.)
- Develop governance framework (e.g., Board and committee requirements)
- Refine tax strategy and risk management and controls
- Document organizational policies and procedures
- Advance Investor Relations (IR) strategy and organization capabilities
- Implement Sec 302/906 certification programs
You’ll certainly want to consult an advisor and fully consider some of the risks and opportunities inherent in the process. Some of these complexities can lead to potential pitfalls if not managed adequately.
* Deloitte helps manage these post-IPO activities, many of which must be undertaken from the first day of trading, or in the days and weeks immediately after the de-SPAC transaction. Our specialists can help make operating as a public company as smooth as possible during the transition and well beyond.
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For questions or a detailed discussion on how we can help you, please contact us below.
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