Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Wednesday, March 26, 2008

Goldman Files SPAC Registration Statement

Goldman Sachs joins the crowd and filed a registration statement to underwrite a "blank check" IPO to raise $350 million for Liberty Lane Acquisition Corp.  Renamed Special Purpose Acquisition Companies, or SPACs, these companies typically have a deadline of two years to complete an acquisition with the funds raised.  This SPAC has a different structure than most; the insiders are contributing $3.5 million, in contrast to the typical 2-4%, and will receive less if the acquisition is successful -- 7.5% in contrast to other deals where the percentage may be as high as 20%.  In addition, the offered units consist of one share of common stock and  one-half a warrant, in contrast to the usual one share and one warrant per unit.  WSJ, Goldman Writes Out 'Blank Check'.

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