Scroll Top
Special Purpose Acquisition Company (SPAC)
Special purpose acquisition Company (SPaC)
1

SCP & CO has leveraged its expertise in healthcare and technology to take advantage of near-term market dynamics and favorable long-term secular trends in digital health by forming SCP & CO Healthcare Acquisition Company. Please visit our digital health SPAC for complete details.  Below is an overview of the audiences who can best take advantage of a SPAC business combination, plus the differentiation points of SCP & CO Healthcare Acquisition Company.

Information about SPAC’s
1

Special purpose acquisition companies (SPAC’s) are rapidly becoming the IPO vehicle of choice in the public markets. Most SPAC’s are seeking high-growth, middle market businesses with Enterprise Values ranging from approximately $250 million to $5 billion. For founders and shareholders of companies that fit this profile, SPAC’s have become a desirable alternative to the traditional IPO process. There are two primary audiences who should educate themselves about SPAC’s, the founders and the funding sources:

Company Founders

Company Founders

READ MORE

Funding Sources (VC/PE/IB)

Funding Sources (VC, PE, IB)

READ MORE

Investment Thesis

1

There are numerous advantages to high-growth, middle market businesses using a SPAC as its vehicle to access the public markets.  While in the past, these special purpose acquisition companies were a seldom-used, rarely mentioned financial instrument, they have achieved broad market acceptance and are now a commonplace, if not preferred method of IPO. With a broad range of digital health expertise and connectivity, SCP & CO is the right partner for your healthcare technology company.  Our track record of growth and commitment in the healthcare space is well documented.  We have captured the investor demand and liquidity that can ensure a successful transition to the public markets for your business.

Expertise

MORE DETAILS

Demand

MORE DETAILS

Connectivity

MORE DETAILS

Growth

MORE DETAILS

Liquidity

MORE DETAILS

Commitment

MORE DETAILS

Corporate profiles suited for SPAC’s
1

An exit to the public markets is well-suited for high growth, middle-market companies that have received multiple rounds of venture capital funding.  Additionally, there have been several successful spinoffs to SPAC’s of operating businesses within existing publicly-traded companies.

Late Stage VC

Late Stage VC

READ MORE

Carve-Outs

Carve-Outs

READ MORE
WHY WORK WITH SCP & CO?
1

Since its inception in 2002, SCP& CO has completed eighty transactions totaling $1.8+ billion of aggregate transaction volume.  Over half of the firm’s transactions have been platform acquisitions, financings, or add-on’s for SCP& CO’s Principals’ buyout control investment vehicles.

about us
ARE YOU LOOKING TO SELL, BUY OR MAYBE DISCUSS YOUR OPTIONS?
CONTACT US TODAY

Special purpose acquisition companies (SPACs) are very popular among company founders. SPACs are products tuned to these volatile times. They are often faster and simpler than a traditional IPO and offer shareholders flexibility as to whether they want to cash out or keep shares with the company. There is an enormous amount of capital looking for a place to go: over $100 Billion in equity capital was raised by SPAC’s in 2020 and 2021 YTD.

Top founders, executives, and investors alike are launching them, including venture capitalist Chamath Palihapitiya of Social Capital, MGM Holdings CEO Harry Sloan, Pershing Square Capital Management founder Bill Ackman, LinkedIn co-founder Reid Hoffman and even former House Speaker Paul Ryan.

For founders of a target company going public, it’s less of a headache. SPACs are simpler than IPOs. Since the transaction is a merger, the founders of the target company need to negotiate with only one party, the acquirer. No roadshow is required to peddle shares. When the deal is done, the company goes public at a set valuation. Basically, the entire IPO process is much easier.

Special purpose acquisition companies (SPACs) are very popular among venture capital, private equity, and investment banking firms for several reasons.

Investors in the target company get faster returns. In a traditional IPO, investors often face a six-month lockup, during which time they can’t sell their shares. With a SPAC, they can trade positions with long-term institutional holders at the outset of the deal. They also avoid any overhang on the stock before they’re able to sell. That tends to weigh down prices in a traditional IPO.

Private equity firms are especially looking to get involved in SPAC’s because they say they can see a more immediate and definitive return on their investments. They can consolidate or invest in a company and flip it to a SPAC, because then they’re out, and they don’t still hold paper after it goes through the IPO.

SCP & CO Healthcare Acquisition Company has the expertise on its management team and board to ensure a successful transition to the public markets for a company in the digital health space:

  • Multiple IPO experiences on the board of directors with NYSE and NASDAQ
  • Extensive backgrounds in healthcare technology
  • Payer relationships spanning all 50 states and providing coverage across 65 million lives

SCP & CO Healthcare Acquisition Company has captured investor demand for digital health:

  • Our $175mm IPO was upsized on launch date to $200m
  • Barclays fully sold the over-allotment shares, adding an additional $30mm
  • The total offering was over-subscribed by 6x
  • This strong demand allowed us to be highly selective and choose long-term healthcare technology investors
  • Our shareholders have a strong interest in supporting a PIPE investment

SCP & CO and our board of directors are wildly connected in the healthcare space

  • Over 16 transactions as control investors and advisors
  • 14 years of experience in post-acute care with SNF, ALF, ILF, etc.
  • 10 years of experience in acute care with Population Health
  • Our board has founded and led companies such as BioMed, MDLive, GeniusRX, and Quest Diagnostics.
  • Our advisor has served on numerous digital health boards, and consulted with the White House Health IT task force.
  • Our bankers, Barclays and Piper Sandler, are heavily connected to the digital health investment landscape

SCP & CO has a proven track record of successful growth in healthcare and technology:

  • Over $1.8 Billion in aggregate transaction value
  • Over 100 years of combined investment experience
  • We have a well-rounded approach to creating long-term value
  • Achieved an IRR of 168% on the life of our portfolio

A SPAC business combination provides greater liquidity for the target company than a traditional IPO:

  • Our $230mm trust will be delivered to the target, either as sold shares or investment capital
  • The full Enterprise Value of the acquisition company is captured by the selling shareholders
  • A private investment in public equity (PIPE) can contribute 1-3x more capital than the SPAC trust
  • The total purchasing power of our SPAC would exceed $1 Billion

Our sponsor team and board of directors are committed to a long-term relationship with the target founders:

  • SCP & CO has owned and operated Mission Health for nearly 20 years
  • SCP & CO has owned and operated Harmony Healthcare for over 10 years
  • With SHAC SPAC, the founders are your advisors, and you have access to our full team.
  • We are not a serial SPAC company simply looking to complete a financial transaction.
  • Our entire team is committed to your success, and we are looking for a true collaborative partnership.

In 2020, SPACs became widely accepted and were used to bring many disruptive, high-growth companies to the public markets. In the US, SPACs helped private companies raise about $80 billion in 2020, representing a 462% year-on-year jump and surpassing the $67 billion raised via traditional IPOs in 2020. The trend accelerated in 2021 with companies raising $64 billion via IPOs and secondary equity offerings in the first three weeks of 2021.

The acceptance of SPAC’s could not be better for late-stage technology companies. Target companies are now faced with two choices, stay private and raise Series D, E, or subsequent round funding, or go public via reverse-merger with a SPAC (SPAC transactions are a relatively easier route to public markets compared with traditional IPOs). Public listing via a SPAC helps companies streamline capital raising, get a better valuation (at least in current ‘risk-on’ market conditions) and focus on future growth rather than the next venture round of funding. Many venture investors see SPACs as a viable option for their companies to go public, sometimes earlier and easier than would be possible in a traditional IPO.

Special purpose acquisition companies (“SPAC”) are tailor made to be the vehicle for a carve-out IPO. Most SPACs are seeking high-growth, middle market businesses with Enterprise Values ranging from approximately $250 million to $5 billion. Nearly every SPAC has a specific industry focus with an accomplished board of directors well suited to guide and advise the management team of the target. The divesting company saves significant time and effort by using a SPAC to IPO, rather than handling the process themselves. The cash value of the transaction is negotiated beforehand, and the sellers receive higher valuations and greater liquidity than a traditional IPO. Public companies may look at this model as an alternative to a traditional spin-off, IPO or sale of a division, with this structure offering the benefit of an anchored public market valuation for the division.