SPAC-based IPO 'conversion' question

[Ákos Maróy 2]

Hi,

I know this question might not strictly be a 'Swing Trading' question, but it is related to IPOs nevertheless.

Nowdays SPAC-based IPOs are more and more frequent, for example NKLA was put on the market through a merger with SPAC VTIQ. Let's use this process as an example for my question below.

My question is: how is the transition happening on the exchange? I believe it would be the case that the SPAC is already listed (in the above example, VTIQ), and one can trade it on the exchange. Then, they merge with their 'target', in this example with Nikola Motors. Afterwards, is it the case that VTIQ is simply 'renamed' NKLA on the exchange? That is, if someone already owns VTIQ shares before the merger / renaming takes place, he'll just be having NKLA instead of VTIQ afterwards, automatically? Would it be always a 1:1 conversion, or something different?

Thank you,

 

Ákos