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Israel’s securities regulator sets out terms for Tel Aviv SPACs

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The Israel Securities Authority (ISA) laid out on Sunday the terms according to which special purpose acquisition companies (SPACs) can be set up in Israel, something that wasn’t possible until now because of regulatory hurdles. The terms aim to protect investors, the ISA said.

The ISA set out the rules after it was approached by a number of companies interested in publishing a prospectus for the setting up of SPACs in the Tel Aviv Stock Exchange.

SPACs, also called “blank check” companies, are a form of a shell company set up by an entrepreneur, called a sponsor, for the specific purpose of raising money through an initial public offering of shares to acquire or merge with another company — this one with operations — which is looking to go public via a reverse merger.

SPACS, which took off last year in the US and globally, have provided private companies a popular and alternative avenue to go public.

The Tel Aviv Stock exchange does not currently allow SPACs because its regulations, decades ago, say that companies can issue shares on the exchange only if they have an operational track record of a period of a year, or if they raise over NIS 200 million ($61 million).........

© The Times of Israel

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