April 1, 2024

It now looks as if investors in London will, just as their US counterparts have for a while, be offered the curious privilege of handing over lots of money to management teams who promise to spend it on some great deals, even if what they are actually going to buy is still kept carefully under wraps.

Marwyn, a London-based sponsor of acquisition companies, has announced plans for a £500m acquisition vehicle to be listed in London.

At the same time, Sky News reported that a £150m acquisition vehicle called Finsac, set up by former executives from KBN and Munich Re, would be listed in London soon. There could be plenty more in the pipeline.

Dodging the bullet

At the height of the boom in Spacs – special purpose acquisition companies that raise millions in capital with the aim purely of buying other companies – in New York, there was plenty of criticism that London was missing out.

As so often in the past, the US market was innovating furiously, while the British one was getting left behind.

There was even a Brexit twist to the tale, as Amsterdam, London’s main rival in the equities industry now that we are out of the EU, managed to list more than 30 Spacs, while the City listed almost none. The LSE tweaked its rules to make it easier, but still no one seemed interested.

The UK might have dodged a bullet. It turns out that Spacs were not such a great idea after all.

Spacs boomed in New York in 2020 and 2021 with billions raised on little more than reputation and promises. In…

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