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Going-private transactions

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Comments On Proposed Rules For Special Purpose Acquisition Companies, Shell Companies, And Projections, Andrew F. Tuch Jan 2022

Comments On Proposed Rules For Special Purpose Acquisition Companies, Shell Companies, And Projections, Andrew F. Tuch

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In March 2022, the Securities and Exchange Commission released proposed rules for special purpose acquisition companies (SPACs), shell companies, and projections. In this comment letter, filed with the SEC, I provide a critical assessment of this proposal.

The SEC proposed far-reaching changes intended to enhance investor protections and align disclosure and liability rules in de-SPACs more closely with those in traditional IPOs. An under-appreciated feature of the proposed reforms is that they would subject de-SPACs to provisions closely modeled on Rule 13e-3 of the Exchange Act, which applies to going-private transactions, including management buyouts. Intended to tackle potential conflicts of …