- Transaction positions KORE to further its global leadership
position in mission-critical Internet of Things (IoT) solutions and
global connectivity, leveraging key technology trends such as 5G,
eSIM and Low-Power Wide-Area
- Consumers and businesses are driving demand for connected
devices, and as we hurtle towards an exponentially more connected
planet, KORE is uniquely positioned to enable its customers to
rapidly adopt and securely scale IoT solutions
- Proceeds include an oversubscribed and upsized $225 million
PIPE, anchored by Koch Strategic Platforms, LLC, a subsidiary of
Koch Industries and part of the Koch Investment Group, and other
top-tier investors including funds and accounts managed by
BlackRock
- Transaction reflects pro-forma enterprise value of the combined
company of approximately $1.014 billion and will provide
approximately $484 million of gross cash proceeds at the $10.00 per
share PIPE price
- Existing majority shareholder Abry Partners has agreed to roll
100% of its common equity into the combined company
KORE Wireless Group, Inc. (“KORE” or the “Company”), a global
leader in Internet of Things (“IoT”) solutions and worldwide
Connectivity-as-a-Service (“CaaS”), and Cerberus Telecom
Acquisition Corp. (NYSE: CTAC.U, CTAC, CTAC WS) (“CTAC”), a special
purpose acquisition company affiliated with Cerberus Capital
Management, L.P. (“Cerberus”), announced today that they have
entered into a definitive merger agreement. Upon completion of the
transaction, the combined company expects to be listed on the New
York Stock Exchange under the ticker symbol “KORE”.
Powered by a strong IP portfolio and a differentiated IoT
platform, KORE delivers mission-critical IoT enterprise solutions
and CaaS services to more than 3,600 customers worldwide, including
Fortune 500 enterprises. The Company manages over 12 million
connected devices, serving a range of industries, with an
increasing focus on key sectors that collectively represent over
80% of the IoT market. With the global IoT market forecasted to
grow to nearly $1 trillion by 2025, KORE believes it is
well-positioned to expand organically and through accretive
acquisitions.
KORE is led by a world-class management team with extensive
public company leadership experience. Through this strategic
combination, KORE will be able to leverage CTAC’s executives and
advisor network with significant operating expertise in the
information and communications technology sector, specifically with
companies participating in the 5G revolution.
“Today’s announcement is a significant step forward for KORE and
a testament to our market-leading IoT Solutions and CaaS business,”
said Romil Bahl, President and Chief Executive Officer of KORE.
“Over the past several years, we have been expanding KORE’s
capabilities to help our customers extend their digital
transformations to the edge, which is the very promise of IoT. As
the 5G revolution accelerates globally, we believe we are
well-positioned to be a critical enabler in helping enterprises
transform their businesses with the power of IoT solutions.”
Tim Donahue, Chief Executive Officer of CTAC and former
Executive Chairman of Sprint Nextel, commented: “This is a rare
opportunity to partner with a proven business supported by a strong
and diversified customer base. KORE is playing a critical role in
the rapidly growing IoT market with meaningful organic and
inorganic opportunities. We look forward to working closely with
Romil and his talented team to provide strategic and operational
counsel, as well as industry relationships, as KORE capitalizes on
the global expansion of 5G.”
Tomer Yosef-Or, Partner at Abry Partners, commented: “We are
proud to have reached this next milestone in our partnership with
KORE. Since our initial investment, the team has done an incredible
job serving its customers by anticipating the future needs and
complexity of a more connected world. We are excited to participate
in KORE’s accelerating growth as a public company and believe this
milestone provides for incremental resources to better serve KORE’s
expanding customer base.”
Transaction Overview
The transaction is expected to provide approximately $484
million of gross cash proceeds to the combined company, assuming no
redemptions by CTAC’s shareholders, and includes a $225 million
PIPE investment. The PIPE, which was oversubscribed and upsized due
to high demand, is anchored by leading institutional investors,
including Koch Strategic Platforms, LLC, a subsidiary of Koch
Industries and part of the Koch Investment Group, and funds and
accounts managed by BlackRock. The fully diluted pro-forma implied
enterprise value of the combined company is approximately $1.014
billion at the $10.00 per share PIPE price. Pro-forma net debt
ratio is expected to be 2.0x, providing the combined company with
financial flexibility to invest in both organic and inorganic
growth.
As part of the transaction, KORE’s majority shareholder Abry
Partners has agreed to roll 100% of its common equity into the
combined company. Assuming no public shareholders of CTAC exercise
their redemption rights, Abry and existing KORE equity holders will
own approximately 38.3%, CTAC shareholders will own approximately
36.8%, and PIPE investors will own approximately 24.9% of the
issued and outstanding common stock of the combined company at
closing.
The transaction, which has been approved by the KORE Board of
Directors and CTAC Board of Directors, is expected to close in
mid-2021. The transaction remains subject to approval by both KORE
and CTAC shareholders, the satisfaction or waiver of customary
closing conditions (including receipt of required regulatory
approvals), and the delivery of certain PCAOB audited financial
statements by KORE.
Romil Bahl will continue to lead KORE as President and Chief
Executive Officer following the completion of the transaction.
Additional information about the proposed transaction, including
a copy of the merger agreement and investor presentation, will be
provided in a Current Report on Form 8-K to be filed by CTAC with
the Securities and Exchange Commission and available at
www.sec.gov.
Advisors
Cowen and Company LLC is serving as exclusive financial advisor
to KORE and Kirkland & Ellis LLP is serving as legal counsel.
Goldman Sachs & Co. LLC is serving as lead financial advisor to
CTAC. Morgan Stanley & Co. LLC is serving as financial and
capital markets advisor to CTAC. Deutsche Bank Securities Inc. is
also acting as financial and capital markets advisor. Cowen and
Company LLC and Goldman Sachs & Co. LLC are also serving as
co-placement agents on the PIPE. Milbank LLP is serving as legal
counsel to CTAC and Ropes & Gray LLP is serving as legal
counsel to the placement agents.
Investor Presentation
All investor materials, including a copy of the investor
presentation, can be found on KORE’s website at
www.korewireless.com/investors and on CTAC’s website at
www.cerberusacquisition.com.
About KORE
KORE is a pioneer, leader, and trusted advisor delivering
mission-critical IoT solutions and services. We empower
organizations of all sizes to improve operational and business
results by simplifying the complexity of IoT. Our deep IoT
knowledge and experience, global reach, purpose-built solutions,
and deployment agility accelerate and materially impact our
customers’ business outcomes. For more information, visit
www.korewireless.com.
About CTAC
Cerberus Telecom Acquisition Corp. (“CTAC”) is a blank check
company formed by an affiliate of Cerberus Capital Management, L.P.
(“Cerberus”), a global leader in alternative investing. CTAC is led
by CEO Tim Donahue, former Executive Chairman of Sprint Nextel and
former CEO of Nextel Communications, and is proud to have the
support of a distinguished advisory board comprised of senior
executives and business leaders from the information and
communications technology sector. For more information, visit
www.cerberusacquisition.com.
About Cerberus
Founded in 1992, Cerberus is a global leader in alternative
investing with approximately $50 billion in assets across
complementary credit, private equity, and real estate strategies.
We invest across the capital structure where our integrated
investment platforms and proprietary operating capabilities create
an edge to improve performance and drive long-term value. Our
tenured teams have experience working collaboratively across asset
classes, sectors, and geographies to seek strong risk-adjusted
returns for our investors.
Cerberus has a dedicated focus on next-generation technologies
and telecommunication solutions. Our team of technologists and
network of advisors collaborate across our investment and operating
platforms to identify opportunities and manage investments in
critical IoT, edge computing, artificial intelligence, private
wireless networks, network equipment, autonomy, aerospace, and
ecosystem development.
For more information about our people and platforms, visit us at
www.cerberus.com.
About Abry Partners
Abry is one of the most experienced and successful
sector-focused private equity investment firms in North America.
Since their founding in 1989, the firm has completed over $82.0
billion of leveraged transactions and other private equity or
preferred equity placements. Currently, the firm manages over $5.0
billion of capital across their active funds. For more information
on Abry, please visit www.abry.com.
Important Information and Where to Find It
This press release is being made in respect of the proposed
merger transaction involving CTAC and KORE. CTAC and Pubco intend
to file a registration statement on Form S-4 with the SEC, which
will include a proxy statement of CTAC and a prospectus of Pubco,
and CTAC will file other documents regarding the proposed
transaction with the SEC. A definitive proxy statement/prospectus
will also be sent to the stockholders of CTAC, seeking required
stockholder approval. Before making any voting or investment
decision, investors and security holders of CTAC are urged to
carefully read the entire registration statement and proxy
statement/prospectus, when they become available, and any other
relevant documents filed with the SEC, as well as any amendments or
supplements to these documents, because they will contain important
information about the proposed transaction. The documents filed by
CTAC with the SEC may be obtained free of charge at the SEC's
website at www.sec.gov. In addition, the documents filed by CTAC
with the SEC may be obtained free of charge from CTAC’s website at
www.cerberusacquisition.com or upon written request to Cerberus
Telecom Acquisition Corp., 875 Third Avenue, New York, NY
10022.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval, nor shall there be any sale of any securities
in any state or jurisdiction in which such offer, solicitation, or
sale would be unlawful prior to registration or qualification under
the securities laws of such other jurisdiction.
Participants in the Solicitation
CTAC, KORE and certain of their respective directors and
executive officers may be deemed to be participants in the
solicitation of proxies from the stockholders of CTAC, in favor of
the approval of the merger. Information regarding CTAC’s and KORE’s
directors and executive officers and other persons who may be
deemed participants in the transaction may be obtained by reading
the registration statement and the proxy statement/prospectus and
other relevant documents filed with the SEC when they become
available. Free copies of these documents may be obtained as
described above.
Forward-Looking Statements
This press release includes certain statements that are not
historical facts but are forward-looking statements for purposes of
the safe harbor provisions under the United States Private
Securities Litigation Reform Act of 1995. Forward-looking
statements generally are accompanied by words such as “believe,”
“may,” “will,” “estimate,” “continue,” “anticipate,” “intend,”
“expect,” “should,” “would,” “plan,” “predict,” “potential,”
“seem,” “seek,” “future,” “outlook,” and similar expressions that
predict or indicate future events or trends or that are not
statements of historical matters. These forward-looking statements
include, but are not limited to, statements regarding estimates and
forecasts of revenue and other financial and performance metrics
and projections of market opportunity and expectations. These
statements are based on various assumptions and on the current
expectations of CTAC or KORE’s management. These forward-looking
statements are provided for illustrative purposes only and are not
intended to serve as, and must not be relied on by any investor or
other person as, a guarantee, an assurance, a prediction or a
definitive statement of fact or probability. Actual events and
circumstances are difficult or impossible to predict and will
differ from assumptions. Many actual events and circumstances are
beyond the control of CTAC and/or KORE. These forward-looking
statements are subject to a number of risks and uncertainties,
including general economic, financial, legal, political and
business conditions and changes in domestic and foreign markets;
the potential effects of COVID-19; risks related to the rollout of
the KORE’s business and the timing of expected business milestones;
changes in the assumptions underlying the KORE’s expectations
regarding its future business; the effects of competition on the
KORE’s future business; and the outcome of judicial proceedings to
which the KORE is, or may become a party. If the risks materialize
or assumptions prove incorrect, actual results could differ
materially from the results implied by these forward-looking
statements. There may be additional risks that the KORE presently
does not know or that the KORE currently believes are immaterial
that could also cause actual results to differ materially from
those contained in the forward-looking statements. In addition,
forward-looking statements reflect the KORE’s expectations, plans
or forecasts of future events and views as of the date of this
press release. The KORE and CTAC anticipate that subsequent events
and developments will cause these assessments to change. However,
while the KORE and/or CTAC may elect to update these
forward-looking statements at some point in the future, each of the
KORE and CTAC specifically disclaims any obligation to do so. These
forward-looking statements should not be relied upon as
representing the KORE’s assessments as of any date subsequent to
the date of this press release. Accordingly, undue reliance should
not be placed upon the forward-looking statements.
Use of Projections
This press release contains projected financial information with
respect to KORE. Such projected financial information constitutes
forward-looking information, and is for illustrative purposes only
and should not be relied upon as necessarily being indicative of
future results. KORE’s independent auditors have not audited,
reviewed, compiled or performed any procedures with respect to the
projections for the purpose of their inclusion in this press
release, and accordingly, they did not express an opinion or
provide any other form of assurance with respect thereto for the
purpose of this press release. The assumptions and estimates
underlying such financial forecast information are inherently
uncertain and are subject to a wide variety of significant
business, economic, competitive and other risks and uncertainties.
See “Forward-Looking Statements” above. Actual results may differ
materially from the results contemplated by the financial forecast
information contained in this press release, and the inclusion of
such information in this press release is not intended, and should
not be regarded, as a representation by any person that the results
reflected in such forecasts will be achieved.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210312005498/en/
KORE
Media
Landon Garner lgarner@korewireless.com
Investors
investors@korewireless.com
Cerberus Telecom Acquisition Corp.
Media
Andrew Cole/Dave Millar/Brooke Jaye Sard Verbinnen & Co.
CTAC-SVC@sardverb.com
OR
media@cerberusacquisition.com
Investors
info@cerberusacquisition.com
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