SPACs and ESG are two of the hottest areas in capital markets. Now they're combining.
More investors are looking for companies that promote environmental, social, and governance (ESG) goals, but finding them is a difficult task. While the B-Corp certification and Public Benefit Corporation status are clear signals of an ESG focus, fewer than 10 public companies have either. Many companies assert they have ESG practices, but those claims often leave much room for debate.
A growing number of SPACs have filed and made acquisitions to meet the demand. Many cite ESG specifically in filing or merger documents, while others state their focus on sustainability, energy transition and efficiency, electric vehicles, renewables, recycling, decarbonization, and the environment.
We count 16 completed SPAC mergers since 2019 that could reasonably qualify as ESG. The group has outperformed, with an average return of 117% from IPO. These deals are packed with EV companies and battery & fuel cell developers such as QuantumScape (QS), Fisker (FSR), ChargePoint (CHPT) ....
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