A Swipe at PIPEs: SEC Raises Disturbing ‘Underwriter’ Issue for Hedge Funds That Provide De-SPAC PIPE Financing

The SEC has proposed wide-ranging new rules about special purpose acquisition companies (SPACs). The main thrust of the SEC’s proposal is to put a business combination between a SPAC and a private operating company – the so-called “de-SPAC” transaction whereby the operating company is ushered into the public market – on roughly the same disclosure and liability footing as a traditional IPO. [i]