September 4, 2021
I am individual investor with a relatively large position of slightly over 14,000 shares in Pershing Square Tontine Holdings (ticker: PSTH). I feel the proposed solution of creating warrants is a preferable alternative to the traditional SPAC structure. I would prefer to have control over my capital and select to opt-in rather than have a third party hold my capital for a longer period of time and then have to opt out of a business combination if I do not want to participate.
With the SPARC structure I can invest my assets elsewhere and then still be able to participate in any potential initial value added of the business combination through selling the warrants on the open market to another investor (who also has not suffered any opportunity cost to that point) who desires to be invested in the announced deal - or - if I believe in the business combination myself I can raise cash and participate. I think its a much friendlier structure for retail investors- and they would be issued free of cost so I have no capital at risk related to the warrants.
I would suspect it will also raise the overall quality of sponsors as well. They will need to consider their own ability to actually get enough warrant holders to opt in to complete a deal or have capital themselves to backstop a deal. Failure to do the former or lack of the latter will impair most sponsors ability to continually negotiate with target companies.
I truly appreciate the SECs duty in protecting investors which undoubtedly has been largely responsible in providing us with the greatest capital markets in the world. I hope to see this latest continuation of improvement for investors approved.
Sincerely,
Anonymous