SPACInsider Logo
Pensare (WRLS) Announces Business Combination with Computex
by Kristi Marvin on 2019-07-25 at 9:55am

Redeemers gonna redeem…(see “Quick Takes” below, as to why…)

Ahead of Pensare’s scheduled July 30th extension vote, Pensare Acquisition Corp. (WRLS), announced this morning that they have entered into a definitive agreement to combine with Stratos Management Systems, Inc. and its operating companies, which do business as Computex Technology Solutions (collectively, “Computex” or “Computex Technology Solutions”). Computex is an IT service provider offering a portfolio of managed IT services including Unified Communications-as-a-Service (UCaaS), directory and messaging services, enterprise networking, cybersecurity, collaboration, data center, integration, storage, backup, virtualization, and converged infrastructure.

Additionally, Pensare has also entered in a non-binding Letter of Intent (the “LOI”) to acquire an undisclosed developer of Unified Communications technology. The planned acquisitions are part of Pensare’s strategy to build a leading national Cloud-Managed Unified Communications and IT Solutions Provider. But wait…there’s more…

Pensare also announced that it has joined AT&T Partner Exchange®. Pensare can now bundle and resell AT&T network, mobility, IoT and cybersecurity solutions with its own services to serve as a one-stop-shop for business customers.

As for the transaction, we don’t have a filed presentation or a scheduled conference call, so the details provided are slim.  However, what we do know is that Pensare will acquire Computex for an aggregate of approximately $65 million in cash, stock, and assumed debt.  Additionally, Pensare would acquire the second target company for an aggregate of approximately $49.5 million in cash, stock, and assumed debt, pursuant to the LOI. Interestingly, the price per share for any Pensare stock issued to Computex’s shareholders will be either the lower of the market price per share or the lowest per share price paid in any PIPE’s Pensare completes in connection with the transaction (see “Quick Takes” for why).

Quick takes:  Not a whole lot of information on this transaction has been provided just yet, but this is presumably because Pensare has their extension vote next Tuesday, July 30th.  At that vote, Pensare will be asking for an additional four months to move their deadline to December 1, 2019, but have already stated that they DO NOT intend to contribute any additional funds to trust for shareholders who do not redeem. As a result, we can expect a significant number of redemptions. However, it sounds like that’s what Pensare wants, i.e., to reduce the trust amount and replace the shareholders with PIPE investors, albeit, done at a much lower effective share price.  This explains why the shares to be issued to Computex’s shareholders will be done “at either the lower of the market price per share or the lowest per share price paid in any PIPE’s Pensare completes in connection with the transaction.”  This is a nice way of saying, “we probably already have an idea of where this PIPE will be priced, but we don’t want to disclose it yet because it’s going to be below $10.00.”

So, as a result, we can probably expect a near complete redemption of the trust, a new PIPE to replace the cash, but done at a price below $10.00, and Rights holders will sell their converted shares into the market to drive the price down (and provide some much needed liquidity).  Remember, there will be an additional 3,105,000 shares added to the float once those Rights convert.  Pensare’s current estimated redemption value is approximately $10.44.

The transaction is expected to close in the fourth quarter of 2019.


THE TRANSACTION

  • Pensare will acquire Computex for an aggregate of approximately $65 million in cash, stock, and assumed debt
  • Pursuant to the terms of the LOI, it is proposed that Pensare would acquire the second target company for an aggregate of approximately $49.5 million in cash, stock, and assumed debt
  • The price per share for any Pensare stock issued to Computex’s shareholder would be the lower of the market price per share or the lowest per share price paid by any purchaser in any private placement effected by Pensare in connection with the transaction.
  • The transaction is expected to close in the fourth quarter of 2019.

ADVISORS

  • EarlyBirdCapital is serving as financial and capital markets advisor to Pensare.
  • Greenberg Traurig, LLP is acting as legal counsel to Pensare.
Recent Posts
by Nicholas Alan Clayton on 2022-12-09 at 8:38am

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 contributors Anthony Sozzi and Sam Beattie. The year was 2019. The volume of SPAC news...

by Marlena Haddad on 2022-12-08 at 5:35pm

  Below is a daily summary of links to the latest SPAC news and rumors gathered across the web.  Latest SPAC Liquidations: Sierra Lake, Z-Work, Lerer Hippeau, and Climate Real Impact Solutions II Sierra Lake Acquisition Corp. Shareholders Approve Liquidation   Sierra Lake Acquisition Corp. (NASDAQ: SIER) announced today that due to its inability to...

by Nicholas Alan Clayton on 2022-12-08 at 2:28pm

Parsec Capital (NASDAQ:PCX) announced in an 8-K this morning that it has begun the process of liquidating its trust account, but the filing also curiously notes that the team is trying to carry on with its announced combination with Enteractive Media. The announcement matches what the SPAC said in its 10-Q filed November 18, that...

by Marlena Haddad on 2022-12-08 at 12:56am

  Below is a daily summary of links to the latest SPAC news and rumors gathered across the web.  Latest SPAC News: Palihapitiya blames Fed for crushing the blank-check bubble, and Hong Kong is set to regain top-three IPO ranking in 2022 SPAC king Chamath Palihapitiya says the Fed crushed the bubble in blank-check firms...

by Marlena Haddad on 2022-12-08 at 12:50am

PHP Ventures Acquisition Corp. (NASDAQ: PPHP) has entered into a definitive agreement to combine with ConstrucTech company Modulex Modular Buildings Plc (“Modulex”) at a valuation of $600 million. UK-based Modulex manufactures 3D volumetric steel modular buildings and harnesses emerging technologies to meet housing and infrastructure needs. The combined company is expected to trade on the...

Privacy Policy|Terms Of Use
Copyright © 2022 SPACInsider, Inc. All Rights Reserved