SPACs in the City: the tax take

The recent frenzy in special purpose acquisition company (SPAC) listings in the US has prompted speculation on whether European markets including the UK could attract similar interest. Changes to the UK listing rules implemented in August were designed to make London a more ‘friendly’ listing venue for SPACs.

But how friendly is the City’s tax environment when it comes to SPACs? After providing a brief background on what SPAC transactions actually involve we examine the key UK tax considerations that can arise at various stages of the SPAC lifecycle from incorporation and initial public offering (IPO) to the SPAC’s ‘business combination’ with a target group (the ‘de-SPAC’). Most of these considerations...