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I noticed that most (all?) SPAC warrants only become exercisable on the later of: (a) 12 months after the SPAC's IPO date, (b) 30 days after the de-SPAC transaction. I am surprised by this uniformity across many SPACs. What could be the reason(s) for the 30-day delay before the warrants can be exercised?

I have read this informative article — Special Purpose Acquisition Companies: An Introduction, which mentions the 30-days' delay but does not explain the reason for it.

Flux
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1 Answers1

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Warrant redemptions dilute the common shares, leading to a drop in price in most cases.

Here's an article that discusses dilution. I leave it to you to determine if it answers your question properly.

Bob Baerker
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