What Investors Should Know About SPACs on Singapore Exchange (SGX)

Singapore has created stock market history with the listing of our first special purpose acquisition companies (SPAC) here.

On Thursday 20 January, Vertex Technology Acquisition Corporation Ltd (SGX: VTA), a SPAC sponsored by Singapore state investor Temasek-owned Vertex Venture, became the first SPAC to be listed on the Singapore Exchange (SGX).

It opened for trading at S$5.25 per share, up from its offer price of S$5.

The following day, Pegasus Asia (SGX: PGU), a SPAC backed by European asset manager Tikehau Capital and the family office of LVMH owner, took its first breath as a listed entity. It opened at S$5.01 on its debut day.

To help Singaporeans learn more about SPACs, Ryan Huang from MONEY FM 89.3 invited me to discuss the hottest topic in the Singapore stock market right now.

For those who may not be aware, SPACs are basically “blank cheque” shell companies that allow private companies to turn public without going through the traditional initial public offering (IPO) process.

Ryan and I covered topics such as why would investing in SPACs be attractive for retail investors, what an investor gets by buying SPACs, the various stages of a SPAC listing up till de-SPAC, the risks involved with SPAC investing, and a quick background of the SPACs on the pipeline.

I also talked about why I wouldn’t invest in SPACs.

Do check out the interview below to understand more about SPACs before investing in them.

(Side note: You will hear the company MoneyWiseSmart — an investment educator that helps subscribers navigate the stock market with the long-term in mind — mentioned in the interview. I’ve joined MoneyWiseSmart as Head of Content Strategy from Seedly previously.)

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Disclaimer: This information provided in this article is purely based on my opinions and is not intended to be personalised investment advice. The ideas discussed here are not recommendations to buy/sell any stock. The writer Sudhan P doesn’t own shares in any companies mentioned.

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