Collier Creek looking like a snack!
The rumors were true….Collier Creek Holdings (CCH) announced this morning that they have entered into a definitive agreement to combine with Utz Quality Foods, LLC, to create Utz Brands, Inc. Utz Brands will be a leading pure-play snack food platform in the U.S., and it is expected that upon closing Utz Brands will trade under the ticker symbol “UTZ” on the New York Stock Exchange.
As for the transaction details, Collier Creek intends to use the approximate $453 million of cash currently held in trust (assuming no redemptions) and the $35 million forward purchase of units to fund this deal, which will reduce Utz’s indebtedness to ~3.1x estimated 2020 Pro Forma adjusted EBITDA of $134 million. It is anticipated that Utz Brands will have an initial enterprise value of approximately $1.56 billion or 11.6x its estimated 2021 PF Adjusted EBITDA.
The Rice and Lissette family, the founding family and owners of Utz, will retain more than 90% of its existing equity stake, which will represent more than 50% ownership in Utz Brands upon completion of the transaction.
Dylan Lissette, who has served as Utz’s CEO since 2013 and has worked at the Company for almost 25 years, will continue to lead the business along with the existing management team. Roger Deromedi, Collier Creek’s Co-Executive Chairman and former Chairman of Pinnacle Foods and CEO of Kraft Foods, will become Chairman of Utz Brands.
Quick Takes: As someone who has been snacking pretty consistently during the pandemic, along with many other people, this transaction looks pretty tasty. You have an established, recognizable brand name and portfolio, but more importantly, Utz gets to go public with Roger Deromedi as Chairman. Obtaining that kind of leadership is one of the best reasons to go public via a SPAC. If Utz were to go the traditional IPO route, they (presumably) wouldn’t have the advantage of having the experience and rolodex of a seasoned executive like Mr. Deromedi join their company. And since Mr. Deromedi is a highly recognizable name in the space, having previously headed the public companies of Pinnacle Foods and Kraft Foods, that is a huge advantage for Utz. This transaction does have a minimum cash closing condition of $300 million, but given that the CCH’s share price is already trading above $12.00, they should have very few (if any) redemptions, i.e., meeting $300 million shouldn’t be an issue.
CONFERENCE CALL INFORMATION
Collier Creek’s investor conference call and presentation discussing the transaction can be accessed by visiting www.netroadshow.com and entering the passcode Utz2020.
A transcript of the call will also be filed by Collier Creek with the SEC.
- Goldman Sachs and Sageworth are acting as financial advisors to Utz.
- Citigroup, Credit Suisse, and BofA Securities are acting as capital markets advisors to Collier Creek.
- Citigroup and Credit Suisse are acting as lead financial advisors.
- BofA Securities and Nomura also serving as financial advisors to Collier Creek.
- Cozen O’Connor is acting as legal counsel to Utz.
- Kirkland & Ellis LLP is acting as legal counsel to Collier Creek.
Below is a daily summary of links to the latest SPAC news and rumors gathered across the web. Latest SPAC News: Circle spokesperson denies blaming SEC for failed deal, BuzzFeed CEO says AI-powered content will be part of core business, and FaZe Clan faces possible delisting Circle Spokesperson Denies Blaming SEC for Failed $9 Billion Deal...
Health Sciences 2 (NASDAQ:HSAQ) announced that it closed its combination with Orchestra BioMed on January 26. HSAQ ahead of its vote pre-announced redemption figures of 1,597,888 shares equating to 67.7% redemptions, however, that’s still subject to change. However, today it was noted that Orchestra BioMed is to receive $70 million in gross proceeds including $20...
Carbon capture technology has long been talked about, and it is finally in operation with LanzaTech among the pioneers. Its plants are turning potential emissions into clothing, household goods and sustainable fuels. SPAC cash is now also an accelerant in this new process as the company announced a $1.7 billion combination with AMCI II last March. This week, we caught up with...
In this series we’ll be examining successful SPAC deals from the past both in the terms and circumstances of their de-SPAC processes and how they have weathered the storms that have followed after their public listings with research from SPACInsider contributor Anthony Sozzi. Thirty months does not sound like that long, but it’s been a...
Seaport Calibre Materials Acquisition Corp. (Nasdaq: SCMA) announced this afternoon that it is pushing today’s special meeting back until January 31. The SPAC is currently facing a completion deadline of February 1, but is looking to extend its timeline by an additional six months to August 1. Stockholders may elect to redeem their shares for a pro rata...