What is a SPAC?
What is a SPAC?
SPAC stands for Special Purpose Acquisition Company or Special Purpose Acquisition Corporation.
SPACs are publically traded companies with only cash and no operations.
Their sole purpose is to raise money, search for a revolutionary private company, and take them public.
If Blubbr was a SPAC
We would IPO our SPAC, Blubbr A, under the ticker BLBA with a share price of $10.
If we started with $100 million in our bank account, we could issue 10,000,000 shares of BLBA.
Our management team would be seeking to acquire a company worth around $100M.
Media Coverage
Before the merger is announced, media companies might release articles about potential targets for BLBA.
For example, BLBA might be looking to acquire a company such as Replit.
If the market thinks this is a good acquisition, the BLBA share price will increase above $10 a share.
Blubbr Strikes Back
SPAC issuers will often create subsequent SPACs after finding acquisitions for their current SPACs.
If the Blubbr team believes BLBA is close to finalizing a deal, Blubbr may file for a second SPAC, BLBB.
This indicates BLBA is likely to merge soon and will likely see a price increase.
The Merger
Blubbr and Replit file with the SEC to officially announce they are merging.
In 3 months, the BLBR ticker will change to REPL and all Blubbr shares become Replit shares.
BLBR price will likely have strong price movements to reflect the merger confirmation.
