Business Context and Reporting Period
B. Riley Principal Merger Corp. filed this Form 8-K on February 7, 2020, under Item 8.01 to provide an update before its February 11, 2020 special stockholder meeting. The proposed transaction would combine the company with Alta Equipment Holdings, Inc., a provider of industrial and construction equipment and related services.
Key Financial and Transaction Metrics
- Public shares eligible for redemption: 14,375,000.
- Shares submitted for redemption by the February 7 deadline: 1,453,762, or less than 11% of public shares.
- Expected cash remaining in the trust account after redemptions: greater than $131 million.
- Planned borrowing under the amended ABL First Lien Credit Agreement: $115 million advanced, with the remaining $185 million commitment available.
- Planned borrowing under the Note Purchase Agreement: $155 million.
- The filing does not provide revenue, profit, operating cash flow, margin, or other historical financial results for Alta or the registrant.
Material Changes Versus the Prior Comparable Period
This filing is a transaction update rather than a periodic financial report. It reports limited redemption activity and the resulting expected trust-account proceeds, as well as intended debt financing draws. The filing does not present comparative operating results.
Guidance, Outlook, Risks, and Unusual Items
- Management expects the limited redemptions to leave more than $131 million available from the trust account at closing, subject to completion of the business combination.
- The company intends to use the available trust proceeds and debt financing in connection with the business combination and related acquisitions of Liftech Equipment Companies, Inc. and FlaglerCE Holdings, LLC.
- Completion remains subject to stockholder approval and other closing conditions. The special meeting was scheduled for February 11, 2020.
- Key risks include failure to complete the merger or acquisitions, legal proceedings, failure to obtain or maintain NYSE listing, integration and execution risks, competition, customer and supplier retention, management retention, transaction costs, regulatory changes, and adverse economic or business conditions.
- The stated trust-account proceeds, debt advances, transaction benefits, and future performance are forward-looking and may differ materially from actual results.
Investor Verification Checklist
- Verify the final redemption amount and cash actually released from the trust account.
- Confirm stockholder approval and satisfaction of all other merger closing conditions.
- Review the February 4, 2020 Form 8-K for the detailed terms of the amended ABL, Note Purchase Agreement, and Floor Plan Credit Agreement.
- Verify whether the planned $115 million ABL advance and $155 million note financing were funded and the resulting leverage and liquidity.
- Review the definitive proxy statement, including transaction risks, acquisition terms, and projected financial information.
- Confirm completion and financial impact of the Liftech and Flagler acquisitions.