Famed short-seller Carson Block is crafting more bets against more special purpose acquisition companies, according to a report, and warning that some retail investors will fall victim to the SPAC market that he describes as a “scam.”
“The market is a scam — and it’s here to stay,” he said in a telephone interview with Bloomberg. He declined to identify his latest targets, the report said. It also quoted Block as saying that some retail investors will become victims of “predatory plays.”
SPACs take companies public by acquiring or merging with them and are considered as a faster and less expensive alternative to a traditional IPO.
Bloomberg noted that Block has recently bet against XL Fleet Corp., a company that transforms existing commercial vehicles like small trucks into electric vehicles. XL Fleet went public late last year through blank-check company Pivotal Investment Corporation II and its shares have dropped by nearly 70% since the start of 2021.