Abu Dhabi passes Spac regulations

The Securities and Commodities Authority (SCA) has approved a regulatory framework to allow Special Purpose Acquisition Companies (Spacs).

Spacs, also known as blank cheque companies, have become a popular strategy for acquiring or merging with private companies. These shell companies are set up to raise money through an initial public offering with the sole purpose of acquiring or merging with a private company.

According to consultant EY, almost 500 Spacs went public in 2021, raising more than $136.7 billion.

The move from the SCA paves the way for the first Spac listings in Abu Dhabi and has been welcomed by the Abu Dhabi Securities Exchange (ADX) which developed the regulatory framework in conjunction with Abu Dhabi’s Department of Economic Development .

“We are excited to be creating a regional hub for Spacs on ADX,” said Hisham Khalid Tawfiq Abdulkhaliq Malak, chairman of the Abu Dhabi Securities Exchange.

“We are committed to rolling out the Spac framework in a timely manner and preparing the exchange to be operationally ready to support sponsors with listings, marketing, and communication advice,” he added.

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