Filing summary: One Madison Corporation, quarter ended June 30, 2018
Registrant identity: Although the request identifies Ranpak Holdings Corp., this 10-Q is filed by One Madison Corporation, a Cayman Islands blank-check company. It does not report Ranpak’s operating results.
Business context and period
This unaudited 10-Q covers the three and six months ended June 30, 2018. One Madison was formed to pursue a business combination, with a stated focus on North American or Western European consumer-related businesses and adjacent industries. It had not identified or completed a target transaction by the reporting date.
Financial highlights
| Metric | Reported amount |
|---|---|
| Revenue | $0 for the quarter and six-month period |
| Net income | $990,647 for the quarter; $1,579,265 for six months |
| Interest income | $1,265,226 for the quarter; $2,000,600 for six months |
| Operating expenses | $274,579 for the quarter; $421,335 for six months |
| Cash outside the trust account | $646,184 at June 30, 2018 |
| Trust account | $302,000,600 at June 30, 2018, including $301,994,727 in U.S. Treasury bills |
| Total assets | $302,802,366 at June 30, 2018, versus $870,815 at December 31, 2017 |
| Total liabilities | $11,396,265 at June 30, 2018, including $10,500,000 deferred underwriting compensation and $800,000 deferred legal fees |
| Cash flow | $529,418 used in operating activities and $301,173,706 provided by financing activities during the six months |
Profitability and operating margins are not meaningful measures for this pre-combination SPAC, which had no operating revenue. Net income primarily reflected trust-account interest less administrative and general expenses. No conventional funded debt was reported at June 30; the sponsor note had been repaid.
Changes versus the prior comparable period
The filing provides no prior-year comparable operating results. Versus December 31, 2017, the balance sheet reflects the January 2018 IPO and private placement: $300 million of public-share proceeds and $8 million of private-placement warrant proceeds were raised, with $300 million placed in trust. At June 30, 28,640,610 Class A shares, valued at $286,406,100, were classified outside permanent equity as redeemable shares.
Outlook, risks, and unusual items
- Management expected expenses to rise as a public company and as it searched for and conducted due diligence on a business-combination target. No target-specific guidance or earnings forecast was provided.
- The company had until January 22, 2020 to complete a business combination; otherwise it generally must redeem public shares and liquidate. The filing states the target must have aggregate fair market value of at least 80% of trust assets, subject to specified exclusions.
- Investors may redeem public shares in connection with a transaction. The company may need additional financing if transaction costs, redemptions, or the purchase price exceed available funds; sponsor-affiliate loans were possible but not committed.
- The company had $646,184 of cash outside the trust for operations. Management believed it would be sufficient before a transaction, but warned actual search and diligence costs could exceed estimates. Trust funds are restricted, subject to specified permitted uses and claims of creditors.
- Forward purchase agreements contemplated $150 million of securities funding at a business-combination closing, subject to the agreements’ terms. This was not cash available at June 30.
- Management reported no material change in risk factors or market risk, no legal proceedings, and no off-balance-sheet arrangements. Disclosure controls were judged effective; no material change in internal control over financial reporting was reported.
Important facts for investors to verify
- Confirm the registrant: this filing is One Madison Corporation, not Ranpak Holdings Corp.
- Review subsequent filings for any business-combination agreement, transaction completion, financing, or change in the January 22, 2020 deadline.
- Verify the availability and restrictions on trust funds, redemption terms, and the deferred underwriting and legal fees payable if a transaction closes.
- Assess the terms and fulfillment of the $150 million forward purchase commitments and any additional financing or dilution.