SPAC Unit Detachment FAQs

Visit www.sgx.com/SPACs for more product information on SPACs.

What is a SPAC detachment (i.e. units separate/split) event?

SPAC detachment is an event that occurs typically on the 45th calendar day from listing date. The detachment date (D date) is when SPAC units separate into individually traded SPAC shares and warrants. (Note: A SPAC unit comprises of one share and a fractional warrant).

The last day of trading for SPAC units is one business day prior to detachment (D – 1). Unitholders’ who sell their SPAC units on (D – 1) will not be eligible to receive SPAC shares and warrants. Trading in the SPAC shares and warrants will begin on D date.

Unitholders’ accounts will be credited with SPAC shares and warrants two business days after the detachment date (D + 2). Do note that the stock codes for the SPAC share and SPAC warrant may be different from that of the SPAC unit. Similar to other corporate actions like right issues, investors should trade only if they are aware of the quantity of SPAC shares and SPAC warrants they have been allocated.

The three SPACs currently listed on SGX (as at 28 February 2022) will automatically detach on D date into shares and warrants. Other future SPACs, if any, may offer optional detachment. Detachment dates for different SPACs can vary and investors are advised to look out for the SPAC’s announcement on SGXNet and/or in its prospectus.

When will the SPAC units separate/split?

The detachment date (D date) typically falls on the 45th calendar day from the listing date. If the 45th calendar day falls on a weekend or public holiday, detachment will be on the next business day.

How many shares and warrants will I get for every 1 SPAC unit I own after detachment (D date)?

A SPAC unit comprises a SPAC share and a fractional SPAC warrant (e.g. 0.5 of a warrant). The fraction of a warrant that comes with one unit of a SPAC may differ from the fraction of a warrant for another SPAC unit. See the relevant prospectus for more information.

What happens with fractional warrants that cannot be combined after detachment date (D date)?

After detachment, fractional warrants which cannot be combined into whole warrants will be disregarded. Only whole warrants can be traded. If you want to hold whole warrants, you must hold enough SPAC units that upon detachment, will result in whole warrants being issued. 

Example (Pegasus Asia SPAC)

Scenario 1

• Investor holds 100 Pegasus SPAC units
• 1 Pegasus SPAC unit (PGU) comprises a SPAC share and 0.5 of a warrant
• An investor must ensure they hold enough units to form whole warrants:
  • 100 SPAC units (PGU) = 100 SPAC shares (PGS) + 50 warrants (PGEW W291231)
• On detachment date, SPAC units (PGU) will separate into shares (PGS) and warrants (PGEW W291231)
• The 100 SPAC units will be debited from the unitholder’s securities account
• Investor will now own:
  • 100 SPAC shares (PGU) and 50 warrants (PGEW W291231)
  • Crediting of SPAC shares and warrants into securities account 2 business days post detachment

Scenario 2

• Investor holds 51 Pegasus SPAC units
• 1 Pegasus SPAC unit (PGU) comprises a SPAC share and 0.5 of a warrant
• A investor does not hold enough units to form whole warrants:
  • 51 SPAC units (PGU) = 51 SPAC shares (PGS) + 25.5 warrants (PGEW W291231)
• On detachment date, SPAC units (PGU) will separate into shares (PGS) and warrants (PGEW W291231)
• Fractional warrants of 0.5 warrant an investor holds will be disregarded
• The 51 SPAC units will be debited from the unitholder’s securities account
• Investor will now own:
  • 51 SPAC shares (PGU) and 25 warrants (PGEW W291231)
  • Crediting of SPAC shares and warrants into securities account 2 business days post detachment

What is the board lot size for trading of Shares and Warrants?

The shares will be traded in board lot of 100 and warrants will be traded in board lot size of 1.

Where can I check how many shares and warrants I have?

Before the crediting date (D + 2), unitholders will still see their SPAC units in their CDP account holdings. Two business days post detachment date, unitholders will see SPAC shares and warrants credited in their account, and SPAC units debited from the account.

An investor can log on to the SGX Investor Portal to review the CDP account statements to check for the number of shares and warrants credited by 9am on the crediting day (D+2). Do check with your broker and/or financial advisor if you require more information.

I’m worried about trading the wrong quantity of shares and warrants. What can I do?

Similar to other corporate actions, investors should trade only if they are aware of the quantity of SPAC shares and SPAC warrants they have been allocated. Do check with your broker and/or financial advisor if you require more information.

Can I still trade SPAC units on detachment date? If I cannot trade SPAC units from detachment date onwards, what can I trade?

The last day of trading for SPAC units is one business day prior to detachment (D – 1). For SPACs with automatic detachment (note that units for the existing 3 SPACs listed on SGX automatically detach), only SPAC shares and warrants can be traded from detachment date (D).

What happens if I mistakenly trade more SPAC shares/warrants than I have after separation/split?

This may cause a potential short sell scenario. In the event of a short sell on settlement date, CDP conducts a buy-in procedure to buy back shares in the buy-in market for settlement the next day.

For more information on the buying-in process, please see “Settlement Process” here: https://www.sgx.com/securities/clearing-information#Settlement%20Process

If I only hold warrants after the SPAC unit separation/split date, can I vote in the SPAC EGM or on the de-SPAC?

Whole SPAC warrants grant holders the right, but not the obligation to buy the company’s shares at a specific price in the future. These warrants are typically exercisable sometime after completion of an initial business combination (i.e. de-SPAC).

SPAC warrants do not have voting, redemption or liquidation rights and will expire upon a liquidation of a SPAC and/or if a SPAC fails to complete its initial business combination within the stipulated timeline.

Can I exercise the warrants after it has been credited into my account?

The whole warrants are typically exercisable within 30 days after de-SPAC is completed (completion of initial business combination), up to the warrant expiry date (usually five years after completion of the business combination). For some SPACs, the exercise period may be the later of:

i. 30 days after de-SPAC or
ii. 12 months from the SPAC’s IPO.

The warrant holder may elect to use cash to exercise and convert their warrants into shares (typically at a 1:1 ratio) during the exercise period. During the warrant exercise period, the sponsors may potentially call for warrant redemption.

Please refer to www.sgx.com/SPACs for more details on redemption of warrants. For more details on the exercise of specific warrants of the three SPACs listed on SGX as at 28 February 2022, please refer to their individual IPO prospectus.