The SPAC market starts 2022 with abysmal losses, abandoned deals

$LatAmGrowth SPAC (LATGU.US)$ $FOUNDER SPAC (FOUN.US)$ The oversaturated SPAC market is continuing to get crushed in the new year as speculative stocks with little earnings fall further out of favor in the face of rising rates, while a growing number of deals were abandoned in the tough environment.

Companies that went public via blank-check deals have been among those worst affected by January’s tech-driven sell-off. Meanwhile, faced with unfavorable market conditions, many sponsors have been forced to scrap their proposed deals, sometimes even before the SPACs got listed.

“The SPAC bubble is bursting,” said Chris Senyek, senior equity research analyst at Wolfe Research. “SPAC shares are extremely volatile due to their speculative nature.”