1/1/22 - Weekend Listening from Intercontinental Exchange
Our guest this week: Sarah Morgan, Partner at Vinson & Elkins and head of the firm's M&A and Capital Markets Group
And just like that…it’s 2022.
New York City has a new mayor and the New York Stock Exchange has new records to break. In 2021, we added more than $1 trillion in new market capitalization to the world’s largest stock exchange, including four of the five largest IPOs of the year. The work on breaking those records begins on Monday as the NYSE’s new president, Lynn Martin, takes the helm.
Market watchers wonder if another record might be eclipsed: the 613 SPACs that went public last year. When a Special Purpose Acquisition Company, or SPAC, goes public, it starts a two-year timer to complete a merger with a private firm. Currently, 574 of those SPACs are still seeking their target. Mark your calendars for first quarter of 2023, when the biggest tranche of deadlines come due.
We may see fewer celebrity-driven SPACs listed in 2022. In December, the Colin Kaepernick-backed Mission Advancement SPAC called off its merger with The Change Co., a California lender focused on minority borrowers underserved by traditional banks. One of the reasons the deal fell through: Mr. Kaepernick seemed unwilling to sit for live television interviews to promote the venture.
One area where SPAC activity is expected to increase in 2022 and beyond is in the area of clean energy. To meet the commitments forged in Glasgow at COP26 in November, analysts predict required capital expenditures in excess of $100 trillion over the next 30 years.
In a new report from one of the leading law firms in the space, Vinson & Elkins, partner Sarah Morgan says, "The impact of the energy transition, including expenditures for new and existing energy generation sources as well as in every material form of energy consumption, is going to eventually hit every industry. The momentum of significant investment and a welcoming regulatory environment has the potential to create tremendous innovation."
We spoke with Sarah in this week’s episode of “Inside the ICE House.”
The view from Houston, Texas:
Vinson & Elkins Partner Sarah Morgan Offers a Lawyer’s View of the Energy Transition As we approach the end of 2021, some of the most notable SPAC mergers of the year focused on the energy transition, a hallmark of the globe’s long march to net-zero carbon emissions. Sarah Morgan, the head of Vinson & Elkins’ M&A and Capital Markets Group, visited the library to break down prospects for the 500+ SPACs that are still searching for a target before their trusts expire, with many hunting in the electric vehicle and energy transition space. Looking ahead to 2022, Sarah is setting her sights set on the regulatory and market trends that will shape next year.
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