News
Vertiv, a Platinum Equity Portfolio Company, to List on New York Stock Exchange
December 2019 by Marc Jacob
Vertiv Holdings LLC (“Vertiv”), a Platinum Equity portfolio company, and a global provider of critical digital infrastructure and continuity solutions, today announced it will become a publicly traded company through a merger with GS Acquisition Holdings Corp (NYSE: GSAH, GSAH.U, GSAH WS), a special purpose acquisition company co-sponsored by an affiliate of The Goldman Sachs Group, Inc. and David M. Cote. Mr. Cote, CEO of GSAH and former Executive Chairman of the Board and CEO of Honeywell, will serve as Executive Chairman of Vertiv. Vertiv’s existing management team will continue to be led by 30-year industry veteran CEO Rob Johnson. The transaction is expected to close in the first quarter of 2020 and at close Vertiv’s stock will trade under the ticker symbol NYSE: VRT.
With operations in more than 130 countries, Vertiv is a global leader in delivering the hardware, software, analytics and ongoing services customers rely on to enable their vital applications to run continuously, perform optimally and grow with their business needs. The company’s portfolio of power, thermal and IT management along with cooling and IT infrastructure solutions and services that extend from the cloud to the edge of the network, generated nearly $4.3 billion in revenue in 2018.
Key Transaction Terms
The transaction, unanimously approved by both boards of directors, is expected to close in the first quarter of 2020, subject to customary closing conditions, including regulatory approvals, and approval of GSAH’s stockholders. At closing, the public company’s name will be changed to Vertiv Holdings Co. Upon closing, Vertiv will have an anticipated pro forma enterprise value of approximately $5.3 billion, or 8.9x the company’s estimated 2020 pro forma Adjusted EBITDA of approximately $595 million.
Upon completion, it is expected that, subject to various purchase price adjustments and any redemptions by the public stockholders of GSAH, Platinum Equity will hold approximately 38% of Vertiv Holdings Co and the sponsor (including Mr. Cote and affiliates of The Goldman Sachs Group, Inc.) will own approximately 5% of Vertiv Holdings Co. In addition to the approximately $705 million of cash held in GSAH’s trust account, additional investors (including affiliates of Mr. Cote and affiliates of The Goldman Sachs Group, Inc.) have committed to participate in the transaction through a $1.239 billion private placement.
After giving effect to any redemptions by the public stockholders of GSAH, the balance of the approximately $705 million in cash held in GSAH’s trust account, together with the $1.239 billion in private placement proceeds, will be used to pay $415 million cash consideration (subject to certain adjustments) to Vertiv stockholders, pay transaction expenses and reduce Vertiv’s existing indebtedness to up to 3.6x 2019 estimated pro forma Adjusted EBITDA. The remainder of the consideration payable to the stockholders of Vertiv will consist of shares of GSAH common stock.
The transaction will be effected pursuant to the Agreement and Plan of Merger (the “Merger Agreement”), entered into by and among GSAH, Vertiv Holdings, LLC, VPE Holdings, LLC (Vertiv Holdings, LLC’s parent), and the other parties thereto.
Goldman Sachs & Co. LLC acted as lead placement agent and exclusive financial advisor to GSAH. J.P. Morgan Securities LLC acted as financial advisor to Vertiv. Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisor to GSAH. Morgan, Lewis & Bockius, LLP and Gibson, Dunn & Crutcher LLP acted as joint legal advisors to Platinum Equity and Vertiv.
