By leveraging SPAC, New York has once again become the center of global IPOs, and it seems that Hong Kong also wants to be part of this frenzy.
$Hang Seng Index (800000.HK)$ $HKEX (00388.HK)$From electric car battery manufacturers to flying cars, New York has become the desired place for more startups to go public through Special Purpose Acquisition Companies (SPACs). Once listed, SPACs will seek out targets and invest large amounts of funds in promising enterprises that can go public without the complex Initial Public Offering (IPO) process. With the current momentum, the new generation of global unicorn companies will all be listed in New York through SPACs. New York will once again become the center of global IPOs.
Faced with a surge of funds heading to New York, whether it's London, Singapore, or Hong Kong, they all feel the pressure to amend listing rules to attract the so-called 'blank check' companies. According to Bloomberg columnist Chris Hughes, London's listing requirements are too strict, potentially making Amsterdam the SPAC center of Europe. However, the UK already has plans to increase competitiveness. Now Hong Kong is contemplating: should it join the competition of SPACs or not?
At first glance, compared to London or Singapore, Hong Kong does not need to worry too much about missing out on unicorn IPO trades. Last year, the IPO fundraising amount of HKEX hit a ten-year high, and this year, it still maintains its strong position. In addition, with the strong support of funds flowing from the mainland, HKEX's stock market trading volume has soared, quadrupling compared to the main exchanges in London.