Hedge Fund Elliott Joins the US SPAC Boom

(Source: JOHN MINCHILLO / ASSOCIATED PRESS)

[Asia Economy Reporter Yujin Cho] U.S. activist hedge fund Elliott is launching a fundraising effort to establish a Special Purpose Acquisition Company (SPAC).

On the 7th (local time), according to the Wall Street Journal (WSJ), Elliott Management is reportedly in talks with several banks to raise $1 billion (approximately 1.1235 trillion KRW) to establish a SPAC.

The WSJ stated, "If the SPAC establishment proceeds as planned, it is expected to pursue corporate acquisitions worth billions of dollars," adding, "It is unclear which industries Elliott is interested in."

A SPAC is a paper company established for the purpose of acquiring companies. It raises capital through an initial public offering (IPO) and lists on the stock market first, then helps private companies enter the market through mergers and acquisitions (M&A).

Riding the recent boom in the U.S. stock market, SPACs have become a popular route for private companies to go public indirectly. Many celebrities, including PayPal co-founder, former Boeing CEO Dennis Muilenburg who stepped down amid the 737 Max crisis, and billionaire Craig McCaw, have joined in establishing SPACs, resulting in 90 new SPACs being formed just last month.

According to SPAC Research, a total of 116 SPACs have raised $35 billion so far, and the fundraising scale is expected to surpass last year's level (approximately $80 billion).

Elliott Management is a hedge fund founded in 1977 by activist investor Paul Elliott Singer. It seeks profits by purchasing company shares and participating in management to boost stock prices, with assets under management totaling $42 billion. In South Korea, it gained attention by opposing the merger of Samsung C&T and Cheil Industries and attacking the governance issues of Hyundai Motor Group.

This content was produced with the assistance of AI translation services.