Shares of Acorns International (ATV) has surged 34% on Monday, the company is expected to go private following a merger agreement with First Ostia Port which is a controlling shareholder.
Pursuant to the terms of the Merger Agreement, each ordinary share, par value $0.01 per share, of the Company (a “Share” or, collectively, the “Shares”), including Shares represented by American Depositary Shares, each representing twenty Shares (the “ADSs”), issued and outstanding immediately prior to the Effective Time, other than the Excluded Shares (as defined in the Merger Agreement) shall be cancelled in exchange for the right to receive $1.05 in cash per Share without interest (the “Per Share Merger Consideration”). As each ADS represents twenty Shares, each ADS issued and outstanding immediately prior to the Effective Time, other than ADSs representing Excluded Shares, shall represent the right to receive $21.00 in cash without interest (the “Per ADS Merger Consideration”) pursuant to the terms and conditions set forth in the Merger Agreement.
The Per Share Merger Consideration represents a premium of 44.1% over the Company’s closing price of US$14.57 per ADS as quoted on the New York Stock Exchange (“NYSE”) on August 17, 2020, the last trading day prior to the day when the Company received a non-binding “going private” proposal from the Controlling Shareholder. The Merger Consideration also represents an increase of approximately 38.0% over the US$15.22 per ADS offered by the Controlling Shareholder in its revised “going-private” proposal on August 18, 2020, and a premium of approximately 39.4% over the Company’s closing price of US$15.07 per ADS on October 9, 2020, the last trading day prior to issuance of this press release.
The Controlling Shareholder intends to fund a substantial portion of the consideration for the Merger in the form of debt funding from a third-party lender and has delivered to the Company duly executed copies of the Loan and Security Agreement.
The Board, acting upon the unanimous recommendation of a committee of independent directors established by the Board (the “Special Committee”), approved the Merger Agreement and the Merger. The Special Committee negotiated the terms of the Merger Agreement with the assistance of its independent financial and legal advisors.
The Merger, which is currently expected to close during the last quarter of 2020, is subject to customary closing conditions, including the approval of the Merger Agreement by a requisite Company vote of Shares representing at least two-thirds of the voting power of the Shares present and voting in person or by proxy at a meeting of the Company’s shareholders which will be convened to consider the approval of the Merger Agreement and the Merger. The Company will call a shareholders meeting for the purpose of voting on the adoption of the Merger Agreement and the transactions contemplated by the Merger Agreement as soon as practicable. If the Merger is completed, the Company will continue its operations as a privately held company and will be wholly owned by the Controlling Shareholder and, as a result of the Merger, the Company will no longer be listed on the NYSE.