The Moscow Exchange is preparing for a historic event: for the first time on the Russian stock market, a special purpose acquisition company (SPAC or SPV) will appear. This refers to a structure created for a merger with a private business seeking to go public, bypassing the classic IPO procedure. According to my information, the placement could start as early as this year, although at the initial stage such companies will not receive a full listing on the exchange itself.
Vladimir Ovcharov, Managing Director of the Moscow Exchange's equity market, confirmed that the infrastructure for this format is fully ready, and the parties have already begun structuring the deal. The first issuer will be a private company from the IT sector. The organization's name and the amount of capital raised have not yet been disclosed — details are being kept strictly confidential.
The essence of the mechanism and its logic
The SPAC scheme assumes that investors put funds into a specially created company, which then directs the capital into a promising project. As a rule, this involves converting SPAC shares into the target company's securities at the time of its public offering. For issuers not yet ready for a large number of shareholders and public reporting, such an instrument becomes an ideal bridge between the private and public stages of development.
Ovcharov noted that certain companies involved in structuring such deals have already shown interest in this service. This is a logical step for the Moscow Exchange, which seeks to expand its product line and offer the market new opportunities. Global exchanges, including those in the US and Europe, have long used SPACs, and now this instrument has reached Russia.
Context: the rise and fall of SPACs
The history of SPACs on global markets knows both triumphs and disappointments. The peak of popularity came in 2020–2021, when in March 2021 the volume of funds raised through them exceeded $36 billion. However, the hype then subsided: in the first half of 2022, such structures raised only $9 billion in IPOs versus $317 billion for all of 2021, and July of that year became the first month in five years when SPACs in the US failed to raise a single cent.
Nevertheless, interest in the format is returning. This summer, it became known that the humanoid robot manufacturer Agility plans to go public through a merger with a SPAC at a valuation of $2.5 billion. In Russia, the idea was discussed back in 2021, and the current preparation effectively revives that earlier debate.
Demand from retail investors remains high: in July, they invested 142.9 billion rubles in securities on the Moscow Exchange, and their share of equity trades reached 63.3%. The SPAC debut will give this audience another way to participate in financing private companies at an early stage.
My view: The emergence of SPACs on the Moscow Exchange is a timely step that could revitalize the market amid a limited number of classic IPOs. However, investors should exercise caution: such structures carry elevated risks, especially in the early stages, when business transparency leaves much to be desired. The success of the format will depend on the quality of project selection and the level of protection for retail investors.