Size of SPAC IPOs in Europe 2010-2020

The value of SPAC IPOs completed in Europe fluctuated significantly between 2010 and 2020. In 2019, the value of European companies who went public via SPAC amounted to 350 million U.S. dollars, a decrease of 800 million U.S. dollars from the previous year. There were no reported SPAC IPOs completed in 2012, 2014, and 2020. Meanwhile, 2020 was a landmark year for SPAC IPOs in the United States with the total value exceeding 83 billion U.S. dollars.

IPO: SPAC vs traditional
Special purpose acquisition companies are public companies with neither a specific business plan, nor a product or service to sell. The specific purpose of SPACs is to raise capital and then merge with, or acquire a private company. This allows the private company to go public without going through the usual process of filing for an IPO, which typically takes longer and is more expensive. However, the equity returns of IPOs were almost double those of SPAC mergers in 2020.

Why are SPACs less common in Europe?

Despite the boom in SPACs across the pond, Europe has been slow to jump on the SPAC bandwagon. The U.S. has historically been home to more tech companies than Europe, which also means that fewer venture capital-backed IPO exits take place in Europe. This makes it harder for investors to analyze the potential returns a firm in the sector could generate.