What has been changed in SPAC mergers? Evidence from Korea since their introduction

We examine the development of special purpose acquisition companies (SPACs) in Korea from their introduction with a regulation change in 2010. We find that later “generation” SPACs have featured a lower merger success rate, paid a higher merger premium, and taken longer to consummate a merger. Also, more experienced SPAC sponsors have been less likely to secure a merger deal and more likely to pay a higher premium if they have secured a deal. Our results are consistent with the argument that there is increased competition among SPACs for the limited pool of suitable targets.