French tycoon Xavier Niel could launch SPAC company next week

LONDON/PARIS: French telecoms magnate Xavier Niel could launch a European special purpose acquisition company (SPAC) as early as next week in what would be Europe's first major so-called blank cheque company this year, two sources told Reuters on Friday.

Best known for founding mobile operator Iliad in France, Niel's SPAC will be floated on the Paris stock exchange and will look to purchase a European company in the consumer space after completing the listing, the sources familiar with the matter said.

The plan is expected to be announced as soon as Monday, one of the sources said.

Deutsche Bank and Societe Generale are advising Niel on the deal, they added.

Niel and the banks declined to comment when contacted by Reuters.

SPACs are shell companies that use proceeds from going public to buy another company not yet identified at the time of the listing.

Their goal is to allow the target to obtain a stock market listing without going through the process of a traditional initial public offering.

In the United States SPACs have raised a record $58 billion this year, with investors including hedge fund billionaire Bill Ackman and Billy Beane of "Moneyball" fame ploughing cash into what has so far been a niche market.

Europe has lagged behind, with no SPAC listings this year, but there is a pipeline of deals in the waiting, with Neil's SPAC possibly boosting confidence among European SPAC investors, the sources said.

Neil has already pioneered the first and only SPAC in France, which it listed together with other founders in 2016. The SPAC has since become French group Mediawan.

The company has recently announced a raft of deals, including the acquisition of Lagardere Studios.