What is the reported valuation of Vertiv Holdings in this transaction?

The merger consideration is valued at approximately $5.095 billion. This amount is subject to certain adjustments, including Vertiv's cash on hand, outstanding indebtedness, transaction expenses, and the cost of representation and warranty insurance.

How is the transaction being financed, and what role does the PIPE play?

The transaction is being financed through a combination of the cash held by GSAH (from its IPO trust account), proceeds from a PIPE investment, and shares of GSAH Class A common stock issued to the Vertiv Stockholder. The PIPE investment totals $1.239 billion and involves subscriptions from various investors, expected to close concurrently with the business combination.

What is the significance of the Tax Receivable Agreement mentioned in the filing?

The Tax Receivable Agreement (TRA) is an agreement between the combined company and the Vertiv Stockholder. Under the TRA, the combined company will pay the Vertiv Stockholder 65% of the cash tax savings that the combined company realizes (or is deemed to realize) in future periods, resulting from certain pre-existing tax assets and attributes of Vertiv Holdings and its subsidiaries. The combined company will retain the remaining 35% of these tax savings.

VRT 8-K: Material Agreements, Securities & Listing & More

Q: What is the primary purpose of this 8-K filing?

This 8-K filing announces that GS Acquisition Holdings Corp. (GSAH), a special purpose acquisition company (SPAC), has entered into a definitive agreement to merge with Vertiv Holdings, LLC. This transaction is effectively a reverse merger, which will result in Vertiv Holdings becoming a publicly traded company.

Summary

This 8-K filing by GS Acquisition Holdings Corp. announces a definitive agreement to merge with Vertiv Holdings, LLC in a transaction valued at approximately $5.095 billion. This business combination will effectively take Vertiv Holdings public. The purchase price is subject to adjustments based on Vertiv's cash, debt, transaction expenses, and representation and warranty insurance costs. The transaction is structured as a merger where Vertiv Holdings will survive an initial merger with a subsidiary, and then merge into another subsidiary, with the latter as the surviving entity. In conjunction with the merger, GS Acquisition Holdings Corp. has secured $1.239 billion in gross proceeds through a private investment in public equity (PIPE) from various investors, including affiliates of the company's sponsor. This PIPE financing is expected to close concurrently with the business combination. Additionally, Vertiv Holdings, LLC's sole stockholder will receive a combination of cash and Class A common stock of GS Acquisition Holdings Corp. The company will also enter into a Tax Receivable Agreement with the Vertiv Stockholder, entitling the latter to 65% of the future tax savings realized by the combined entity from certain pre-existing tax attributes of Vertiv.

Key Highlights

1GS Acquisition Holdings Corp. (GSAH) announces a definitive agreement to merge with Vertiv Holdings, LLC.
2The total transaction value is approximately $5.095 billion, subject to closing adjustments.
3A PIPE financing of $1.239 billion has been secured from various investors.
4The Vertiv Stockholder will receive cash and GSAH Class A common stock as merger consideration.
5A Tax Receivable Agreement will be entered into, providing Vertiv's stockholder 65% of future tax savings derived from Vertiv's attributes.
6The transaction is structured as a two-step merger involving subsidiaries of GSAH.
7The filing includes exhibits for a joint press release, an investor presentation, and an investor call presentation, providing additional details on the transaction.

Vertiv Holdings Co 8-K Report, Material Agreement (Dec 10, 2019)

Summary

Key Highlights

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