Seth Klarman, the legendary investor and hedge fund manager, has revealed that he’s bet big on a few blank-check firms or special purpose acquisition companies (SPACs) as they’re called, including a nearly $400 million bet on Pershing Square Tontine Holdings, the SPAC debuted by investor Bill Ackman that holds the record for the highest amount ever raised by a SPAC.

Seth Klarman’s firm, Baupost Group, revealed a stake of nearly $400 million in Pershing Square Tontine as of the end of this September in a regulatory filing. The investment firm also bought into another SPAC, reporting a $52.3 million stake in Redball Acquisition Corp, a blank-check firm that raised nearly $600 million in its debut this August.

Just like Pershing Square, Redball has a notable member in its top brass, being Billy Beane, a former American professional baseball player and the current Executive Vice President of the baseball franchise Oakland Athletics.

In addition to those two SPACs, Klarman’s Baupost also reported big stakes in companies including Alphabet, eBay, Fox Corp, Liberty Global, and pharmaceuticals giant McKesson. 

As to SPACs, this year has been a record for their debut, with over $60 billion collectively raised by SPACs this year alone. As SPACs have frequently debuted, companies looking to merge with them have also frequently shown up, with e-scooter company Bird and British electric carmaker Arrival just recently reported to be considering mergers with SPACs. 

Many other companies have also formalized big merger deals with SPACs, one recent example being the lidar startup Aeva which has reached a deal to merge with InterPrivate Acquisition Corp. and add about $363 million to its balance sheet to fund its operations as a result.

Photo credit: Thomas Hawk, licensed under CC BY-NC 2.0

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