Pacifico Acquisition Corp., the latest Asian-related SPAC to go public in the U.S., rose by 0.5% to $10.05 on its Nasdaq debut yesterday, a day after it said raised $50 million in an IPO.
Pacifico acquisition targets won’t “be limited to a particular industry or geographic region, although the company intends to focus on operating businesses in and around the new energy, biotech, and education industries in Asia (excluding China),” a statement said.
Ronald Shuang, the Harvard-educated chairman of Shanghai-headquartered boutique investment and asset management company Balloch Holding Group – Pacifico’s ultimate investor, says Asia’s economic growth prospects and demand for capital among growing businesses are likely to expand the region’s role in global markets despite recent ups-and-downs in the U.S.-China relationship.
In particular, he said in an interview in Shanghai, “there is strong demand for Asian companies for U.S. listings.” SPACs offer a time-saving way to raise capital compared with traditional IPOs, Shuang said.
Given ample global liquidity in capital markets plus the likelihood of continued economic recovery from Covid-19, demand and supply trends look favorable to SPAC issuers, Shuang said. “There will be a gold rush” from Asia into SPACs, he predicted.
Besides working with Asian companies to raise capital, Shuang aims to help smaller U.S. investment firms that can’t afford to maintain a large staff on the ground in Asia to find suitable targets in the region. Regulatory approvals for new investments by global fund management heavyweights such as BlackRock and Fidelity make it likely that increased funds will also come from smaller investment firms, he believes. That would benefit boutique firms like Balloch, Shuang said.
Balloch says it was involved in eight U.S.-listed SPACs in 2020. Besides Pacifico, Balloch is planning two other SPAC listings by the end of this year: Qomolangma Acquisition Corp., also $50 million, will focus on Asian biopharmaceutical、e-healthcare and beauty care businesses, and Quantron Acquisition Corp., at $100 million, will focus on consumer, cleantech and blockchain businesses.
As for U.S. and China policy toward listings in the wake of DiDi’s disappointing New York IPO, Shuang said the ride-sharing company appears to have not heeded or searched out Chinese regulator views about its overseas listing and may not have adequately warned overseas investors of Chinese regulatory concerns. Shuang said U.S. tightening of rules for Chinese issuers was a natural response but predicted that new regulations will eventually emerge to allow U.S. listings by mainland companies.
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