By Pamela Barbaglia
LONDON (Reuters) - JPMorgan is deploying two of its most senior dealmakers in Europe, the Middle East and Africa to help a stream of blank cheque companies that have listed over the past year find acquisition targets in the region.
The Wall Street bank is building out a so-called 'SPAC specialist team' which was set up in August to capitalise on the rise of blank check companies in the United States - now seen as a major driver of dealmaking activity, according to a memo seen by Reuters.
Data from SPAC Research shows that since the start of 2021 alone, 144 SPACs have raised $45.7 billion globally, with backers including high-profile investors, politicians and sports personalities.
JPMorgan's co-head of M&A in EMEA, Guillermo Baygual, will work closely with Lukasz Dziarnowski - a seasoned banker who focuses on clients in Central and Eastern Europe as well as the Middle East and North Africa - to pioneer the SPAC bonanza in Europe and win a slice of lucrative advisory fees, according to the memo.
Based in London, the pair will be involved in all SPAC merger discussions across the EMEA region and play matchmaking between SPAC entrepreneurs and possible targets, the memo said.
"Guillermo and Lukasz should be involved in all SPAC merger discussions we are having across the EMEA region to maximize our collective insight into market activity, identify best practices and deliver top-quality execution," the memo said.
JPMorgan competes head-to-head with the likes of Deutsche Bank to dominate global SPAC league tables.
SPACs raise money from investors with the aim of finding a private company to buy. If the sponsors fail to complete their desired merger within a certain timeframe, the SPAC is dissolved and the money returned to shareholders.
Such vehicles have emerged as a popular IPO alternative for companies, especially in the United States, providing a path to going public with less regulatory scrutiny and more certainty over the valuation that will be attained and funds raised.
JPMorgan's dedicated SPAC taskforce already includes M&A vice-chairman Charlie Dupree and M&A executive director Albert Wong, both focusing on U.S. clients, while three other bankers - Ben Berinstein, Jeff Marks, and Rob Stuhr - provide broader corporate finance advisory for blank check clients in the United States.
"SPAC M&A activity has continued to grow outside of the United States, particularly in Europe where SPAC M&A volume now represents 12% of the market since the beginning of Q4 2020," said the memo. It was signed by JPMorgan's global co-heads of M&A, Dirk Albersmeier and Anu Aiyengar, and by its global head of corporate finance advisory, Rama Variankaval.
While creating a bespoke team of SPAC dealmakers, the memo said most bankers - especially those focusing on M&A and equity capital markets - should make a collective push to help deep-pocketed investors and former executives who are looking to front their own SPACs.
Both Baygual and Dziarnowski will retain their existing roles, with Baygual also leading JPMorgan's EMEA investment banking industries coverage for corporate clients.
For all M&A deals involving SPACs, JPMorgan will deploy members of the SPAC Specialist Team as necessary "in addition to the relevant product and coverage bankers," the memo said.
JPMorgan recently advised on the merger of British electric van start-up Arrival into U.S. SPAC firm CIIG Merger Corp, which is expected to close in March and result in a U.S. listing at a market valuation of about $5.4 billion.
It also worked closely with former Credit Suisse chief executive Tidjane Thiam, who is raising a $250m special purpose acquisition vehicle to invest in financial services businesses.
A number of European banking executives are in the process of launching their owns SPACs, including former UniCredit boss Jean-Pierre Mustier - who recently teamed up with LVMH founder Bernard Arnault and ex-Bank of America dealmaker Diego De Giorgi - as well as former Commerzbank boss Martin Blessing and ex-UBS boss Sergio Ermotti.
(Reporting by Pamela Barbaglia; Editing by Susan Fenton)