Browsed by
Tag: SPAC

Blackstone-Backed Finance Of America Plans $1.9B SPAC Merger To Go Public: WSJ

Blackstone-Backed Finance Of America Plans $1.9B SPAC Merger To Go Public: WSJ



a close up of a laptop computer


© Provided by Benzinga



The Blackstone Group Inc (NYSE: BX)-backed Finance of America Equity LLC is planning to go public through a merger with a blank check company, the Wall Street Journal reported Monday.

What Happened: The consumer-lending platform is expected to merge with special purpose acquisition company Replay Acquisition Corp (NYSE: RPLA) in a deal that will give it a valuation of $1.9 billion, people familiar with the matter told the Journal.

Loading...

Load Error

Institutional investors would reportedly make a private investment of $250 million in Finance of America as it goes public.

The deal is expected to leave Blackstone with 70% ownership of the company.

The consumer lender was originally considering going public through an initial public offering but began negotiating with the founders of Replay Acquisition in the summer, the Journal reported.

Why It Matters: Finance of America’s services span mortgages, reverse mortgages, commercial-real-estate loans, and fixed income investing.

The flurry of activity around SPACs continues unabated. Last month, United Wholesale Mortgage, the biggest wholesale mortgage originator in the United States, was reported to be considering a merger with the blank check company Gores Holdings IV Inc (NASDAQ: GHIV) at a record valuation of $16.1 billion. 

Japanese conglomerate Softbank Group Corp (OTC: SFTBY) is also preparing to launch a SPAC in two weeks’ time as it remains flush with liquidity. 

Chamath Palihapitiya’s three SPAC firms raised $2.1 billion IPOs, last week. 

This month, Los Angeles-based Fisker Inc, an EV startup, is expected to go public by merging with Spartan Energy Acquisition Corp (NYSE: SPAQ).

Price Action: Blackstone Group shares closed almost 0.5% higher at $54.97 on Monday. On the same day, Replay Acquisition shares closed nearly 0.2% lower at $10.26.

Continue Reading
Read the rest
Former Goldman Sachs CEO Lloyd Blankfein says a wash of free money is creating ‘bubble elements,’ citing SPAC market

Former Goldman Sachs CEO Lloyd Blankfein says a wash of free money is creating ‘bubble elements,’ citing SPAC market



Lloyd Blankfein wearing a suit and tie: Brendan McDermid/Reuters


© Brendan McDermid/Reuters
Brendan McDermid/Reuters

  • Goldman Sachs’ former CEO Lloyd Blankfein told CNBC on Thursday that a “wash of free money is clearly creating bubble elements in the markets.” 
  • The banking titan blamed low interest rates for creating free money for large investors. 
  • Blankfein also cited speculation in the growing SPAC market: “Look at SPACs and how much money  is available on the basis of somebody’s reputation as opposed to a business plan.”

Former Goldman Sachs CEO Lloyd Blankfein told CNBC on Thursday that a “wash of free money” due to low interest rates is “clearly creating bubble elements in the markets.”

Loading...

Load Error

“Given that money is kind of free, it presumably is not being allocated in a disciplined way, and so there are bubble elements to this,” Blankfein said. “Look at the credit market — people are lending to what historically would have been weak credits for very little money.”

The banking titan also referred to the SPAC market as a sign that the market is taking on much speculation lately. In this year alone, about 110 blank-check firms led by notable investors like Chamath Palihapitiya and Bill Ackman have raised over $40 billion on public markets. That’s over $26 billion more than what last year’s SPACs raised.

Read more: Citi’s US equities chief warns of an ‘extreme peak’ in earnings revisions heading into the crucial reporting season — and explains why it makes stocks vulnerable to a pullback in the weeks ahead

“Look at SPACs and how much money  is available on the basis of somebody’s reputation as opposed to a business plan,” Blankfein said. 

The banking titan can be added to the growing list of investors voicing concerns about the speculative nature in markets. Last week, venture capitalist Bill Gurley said the stock market reminded

Read the rest