8-KMaterial AgreementsOther EventsExhibits & Filings

AppLovin Corp 8-K Report, Material Agreement (May 17, 2023)

Filed May 17, 2023For Securities:APP

Summary

AppLovin Corporation (APP) announced a significant share repurchase agreement to buy back approximately $335 million worth of its Class A common stock from KKR Denali Holdings L.P. at a price of $21.00 per share. This transaction represents an approximately 8% discount to the previous day's closing price and is expected to close shortly. The repurchase was approved by a Special Committee of independent directors, indicating a structured and governed process. In conjunction with this private repurchase, AppLovin's Board also authorized an increase in its share repurchase program by $296 million, bringing the total authorized amount to $500 million. This demonstrates management's confidence in the company's financial position and its commitment to returning value to shareholders. Following the KKR transaction, approximately $165 million will remain available under the expanded program, allowing for continued flexibility in managing its capital structure and potentially further share buybacks.

Key Highlights

  • 1AppLovin is repurchasing approximately $335 million of Class A common stock from KKR Denali Holdings L.P. at $21.00 per share.
  • 2The repurchase price of $21.00 per share represents an approximately 8% discount to the May 16, 2023 closing price of $22.88.
  • 3The transaction was approved by a Special Committee comprised of independent directors.
  • 4The share repurchase agreement is expected to close by May 18, 2023.
  • 5AppLovin's Board authorized an increase of $296 million to its share repurchase program, bringing the total to $500 million.
  • 6Post-KKR repurchase, approximately $165 million will remain available under the expanded share repurchase authorization.
  • 7Future repurchases may occur through open market purchases, privately negotiated transactions, or Rule 10b5-1 plans.

Frequently Asked Questions

This 8-K filing primarily announces AppLovin Corporation's entry into a material definitive agreement for a significant share repurchase from KKR Denali Holdings L.P. and the subsequent expansion of its overall share repurchase program.

AppLovin is repurchasing shares from KKR Denali in a private transaction at a discount to the market price. This is likely a strategic move to reduce share count, potentially enhance shareholder value, and manage its capital structure, all while benefiting from a discounted purchase price.

The increased share repurchase authorization to $500 million signals management's confidence in the company's financial health and its commitment to returning capital to shareholders. The remaining $165 million after the KKR repurchase provides AppLovin with flexibility for future share buybacks, which can potentially increase earnings per share and the stock price.

Yes, the Share Repurchase Agreement was approved by a Special Committee of AppLovin's Board of Directors, which consisted solely of independent directors not affiliated with KKR Denali, ensuring an objective review and approval process.