Breakingviews’ imaginary SPAC one-ups hedgie stars

NEW YORK (Reuters Breakingviews) - Dear prospective investors,

A nearly empty trading floor is seen as preparations are made for the return to trading at the New York Stock Exchange (NYSE) in New York, U.S., May 22, 2020. REUTERS/Brendan McDermid

Reuters Breakingviews columnists have spent two decades publishing agenda-setting financial insights on global corporate finance and markets. Not all our views have proven correct. But many of our boldest calls to action have not only been spot on, they have been pursued by the very hedge fund managers now taking your money for blank-check companies, or special purpose acquisition vehicles.

To that end, Breakingviews is raising $500 million for our own SPAC, which we are calling ASFI Acquisition, and which will list on the Nasdaq under the proposed ticker BRV. Like hedge fund managers Bill Ackman, Dan Loeb, and Jeff Smith – not to mention proven corporate operators like Casper Sleep’s boss Philip Krim – ASFI Acquisition will buy a yet-to-be-found company. We have a clean slate, no conflicts, and low fees. We look forward to acting as the stewards of your capital.

While other SPAC managers have promised to transfer their proven dealmaking skills to ordinary investors, their deals often come up short. Take Loeb’s Far Point Acquisition. It agreed in January to buy Global Blue, a duty-free retailer that caters to tourists. After a pandemic, and a bit of buyer’s remorse, Loeb’s camp encouraged its own SPAC shareholders to vote down the deal it originated. The acquisition has since been tweaked in an effort to get it done.

We are also free of conflicts of interest, a problem that bedevils other SPACs like the one managed by former Citigroup banker Michael Klein. He has issued four SPACs, all which carry a variation of the name Churchill Capital, and paid his own investment bank to hunt for deals for his investment vehicle. Tilman Fertitta is using his own SPAC to buy a division of his gaming company. Ackman is collecting fees on the hedge fund that will invest in the SPAC that his firm raised. ASFI Acquisition has no such extraordinary relationships, per the Trust Principles espoused by our parent company, Thomson Reuters.

Many SPAC managers also take a pretty penny from investors. In the case of Starboard Capital boss Jeff Smith, who is raising $300 million in a new vehicle, that’s the standard 20% of shares just for doing a deal. ASFI Acquisition will be taking a fee of just 1%. To put that in context, a $500 million SPAC with Smith’s fee structure would effectively need to increase its value from a discounted $400 million to $600 million to get initial investors the same 20% return we are targeting with our investment.

But are these reasons enough to entrust your capital with a crew of financial commentators over hedge fund stars? Loeb’s firm took a stake in Campbell Soup shortly after this publication suggested it needed an activist. We dared agitators to come into AT&T and SoftBank Group before Elliott Management took the bait. Ackman’s Pershing Square jumped on the bandwagon to fight United Technologies’ deal to buy Raytheon Technologies after we pointed out its silliness.

Finally, with an investment in ASFI Acquisition, we are confident you will not only be rewarded with above-market returns, you will receive a lifetime subscription to Breakingviews.


The Managers.


Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.

Sign up for a free trial of our full service at and follow us on Twitter @Breakingviews and at All opinions expressed are those of the authors.