A special purpose acquisition company (SPAC) is a company with no commercial operations that is formed strictly to raise capital through an initial public offering (IPO) for the purpose of acquiring an existing company.
SPACs are increasing in popularity, raising a record amount of IPO money in 2019.
MP Materials, the owner of America’s only domestic source of rare earth metals, announced an agreement to merge with Fortress Value Acquisition Corporation, a special purpose acquisition company sponsored by Fortress Investment Group. Upon completion, MP Materials will remain listed on the New York Stock Exchange under the ticker MP. Jim Litinsky, chairman and CEO of MP Materials, joins “Squawk Box” to discuss.