Privately Held Daseke to Become Nasdaq Listed;
Managed by Daseke’s Current Leadership Team
Hennessy Capital Acquisition Corp. II (NASDAQ:HCAC) (NASDAQ:HCACU)
(NASDAQ:HCACW) (“HCAC”) and Daseke, Inc. (“Daseke”) today announced
they have entered into a definitive merger agreement. This proposed
transaction will allow Daseke to become a Nasdaq-listed public
company.
Daseke is a leading consolidator of the open
deck freight market in North America. Since being founded in 2009,
Daseke has grown revenue both organically and through mergers from
$30 million to $679 million in 2015, representing a compound annual
growth rate of 68%. Daseke’s family of companies has become what it
believes to be the largest owner of open deck equipment and the
second largest open deck transportation and logistics solutions
company in North America. Being a public company will allow Daseke
to 1) add more outstanding companies to the Daseke family, building
what it believes to be the premier open-deck trucking company in
North America, 2) provide stock ownership plans for all employees
and 3) support organic growth and to ensure one of the most modern,
efficient and safest fleets in the industry.
“HCAC is extremely pleased to partner with
Daseke’s management team to oversee the continued growth of the
company through access to the capital markets,” said Daniel J.
Hennessy, Chairman and CEO of HCAC. “Daseke is an ideal target for
our investment vehicle, which is focused exclusively on
best-in-class, industrial growth companies. We believe our
business combination with the Daseke Team of Teams will benefit all
shareholders and enable the company to accelerate its consolidation
of the open deck freight sector.”
Daseke will continue to be led by current
Chairman, President and CEO Don Daseke, who stated, “We are excited
to have HCAC join our Daseke family as we become a Nasdaq-listed
public company. HCAC shares our philosophy of investing in people.
We believe this formidable combination will enable us to continue
to add more outstanding open deck companies to the Daseke family.
We are the largest owner and operator focused on this very
fragmented, $133 billion a year, open deck transportation market,
of which we believe we have less than 1% of the market share. We
believe Daseke has the most experienced management team in the open
deck and specialized transportation industry, and we are excited
for what we see as an amazing opportunity to continue our growth
through working daily to achieve operational excellence and by
adding quality carriers to our family.”
Transaction DetailsHCAC will acquire all of the
outstanding capital stock of Daseke in an all-stock merger
transaction. The proposed transaction will introduce Daseke
as a publicly traded company, with an anticipated initial
enterprise value of approximately $702 million. In connection with
the merger, HCAC will change its name to Daseke, Inc. and apply to
continue to list its common stock and warrants on the NASDAQ
Capital Market under the ticker symbols “DSKE” and “DSKEW,”
respectively.
Under the terms of the merger agreement, the
aggregate consideration payable upon closing will be $626 million,
consisting entirely of newly issued shares of HCAC common stock at
a value of $10.00 per share, subject to certain adjustments for
Daseke’s cash, indebtedness, unpaid income taxes and unpaid
transaction expenses and the repurchase of shares held by certain
existing Daseke stockholders. The merger agreement also
contains an earn-out provision through which HCAC may issue up to
15 million additional shares of HCAC common stock to existing
Daseke stockholders for the achievement of specified Adjusted
EBITDA targets and share price thresholds for the fiscal years
ending December 31, 2017, 2018 and 2019.
HCAC has secured all the required financing to
complete the proposed transaction and related refinancing,
including fully committed debt and equity financings as
follows:
- $350.0 million in new term loan credit facilities committed by
Credit Suisse and UBS Investment Bank;
- $70.0 million in new asset-based revolving (ABL) credit
facility committed by PNC Bank, National Association;
- $65.0 million of HCAC convertible preferred stock committed to
be sold in a private placement with certain investors; and
- $35.0 million of HCAC common stock backstop commitments from
certain investors to purchase (to the extent requested by HCAC) up
to $35.0 million of shares of HCAC common stock, through open
market or privately negotiated transactions, in order to backstop
potential redemptions by HCAC’s public stockholders.
Additional information about the proposed
transaction and related financing transactions will be described in
HCAC’s preliminary proxy statement relating to the merger, which
HCAC will file with the U.S. Securities and Exchange Commission
(the “SEC”).
Upon completion of the proposed transaction,
HCAC Chairman and CEO Daniel J. Hennessy and President, COO and
director Kevin Charlton will join the Daseke board of directors,
which will consist of seven members, including Daseke Chairman and
CEO Don Daseke and Executive Vice President and CFO Scott Wheeler,
as well as three additional independent directors who serve on the
Daseke board.
The proposed transaction is subject to customary
closing conditions, including regulatory and stockholder approvals
and the receipt of proceeds from the proposed debt and equity
financing activities, and is expected to close promptly following
HCAC’s special meeting of stockholders to approve the proposed
transaction. Upon consummation of the proposed transaction, it is
anticipated that Daseke management will own approximately 50% of
the combined company common stock (assuming redemptions of
approximately 67%). The parties expect the merger will be
completed in the first quarter of 2017.
HCAC was advised on the transaction by Stifel,
UBS Investment Bank, Cantor Fitzgerald & Co., BMO Capital
Markets and XMS Capital Partners, LLC, with Sidley Austin LLP and
Ellenoff Grossman & Schole LLP as legal counsel. Daseke
was advised by Cowen and Company with Vinson & Elkins LLP as
legal counsel.
The description of the proposed transaction is
only a summary and is qualified in its entirety by reference to the
merger agreement, a copy of which will be filed by HCAC with the
SEC as an exhibit to a Current Report on Form 8‐K.
Conference CallTomorrow, December 23, 2016 at
7:30 a.m. Central time, the management of HCAC and Daseke will host
an investor conference call to discuss the proposed
transaction. Interested investors may participate in the call
by dialing (844) 358-9181 and refer to audience passcode 44991725.
In addition, a webcast of the conference call can be accessed
through the company’s website, www.hennessycapllc.com. There
will not be a question-and-answer session on this call.
A telephonic replay of the conference call will
be available through February 28, 2017 at 9:00 a.m. Eastern Time.
To access the replay, please dial (855) 859-2056 and reference
audience passcode 44991725. Interested parties may also access the
archived webcast of the conference call through the company’s
website approximately two hours after the end of the call.
About Hennessy Capital Acquisition Corp.
IIHennessy Capital Acquisition Corp. II is a blank check company
founded by Daniel J. Hennessy for the purpose of effecting a
merger, capital stock exchange, asset acquisition, stock purchase,
reorganization or similar business combination with one or more
businesses. The company's acquisition and value creation
strategy is to identify, acquire and, after its initial business
combination, build an industrial manufacturing, distribution or
services business. The HCAC management team brought Blue Bird
Corporation public in 2015.
Additional Information About The Transaction And
Where To Find It The proposed transaction will be submitted to
stockholders of HCAC for their consideration. HCAC intends to file
with the SEC preliminary and definitive proxy statements in
connection with the proposed transaction and other matters and will
mail a definitive proxy statement and other relevant documents to
its stockholders as of the record date established for voting on
the proposed transaction. HCAC’s stockholders and other interested
persons are advised to read, once available, the preliminary proxy
statement and any amendments thereto and, once available, the
definitive proxy statement, in connection with HCAC’s solicitation
of proxies for its special meeting of stockholders to be held to
approve, among other things, the proposed transaction, because
these documents will contain important information about HCAC,
Daseke and the proposed transaction. Stockholders may also obtain a
copy of the preliminary or definitive proxy statement, once
available, as well as other documents filed with the SEC by HCAC,
without charge, at the SEC’s website located at www.sec.gov or by
directing a request to Nicholas A. Petruska, Executive Vice
President, Chief Financial Officer and Secretary, 700 Louisiana
Street, Suite 900, Houston, Texas, 77002, or by telephone at
(713) 300-8242.
Participants in the SolicitationHCAC and its
directors and executive officers and other persons may be deemed to
be participants in the solicitations of proxies from HCAC’s
stockholders in respect of the proposed transaction. Information
regarding HCAC’s directors and executive officers is available
under the heading “Directors, Executive Officers and Corporate
Governance” in HCAC’s definitive proxy statement for its 2016
annual meeting of stockholders dated November 22, 2016 filed by
HCAC with the SEC on November 22, 2016. Additional information
regarding the participants in the proxy solicitation and a
description of their direct and indirect interests will be
contained in the proxy statement related to the proposed
transaction when it becomes available, and which can be obtained
free of charge from the sources indicated above.
Forward‐Looking StatementsThis news release
includes “forward-looking statements” within the meaning of the
“safe harbor” provisions of the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements may be
identified by the use of words such as “estimate,” “plan,”
“project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,”
“seek,” “target” or other similar expressions that predict or
indicate future events or trends or that are not statements of
historical matters. Such forward-looking statements with respect to
the benefits of the proposed transaction, the future financial
performance of HCAC following the proposed transaction, changes in
the market for Daseke’s services, and expansion plans and
opportunities, including future acquisition or additional business
combinations are based on current information and expectations,
forecasts and assumptions, and involve a number of judgments, risks
and uncertainties. Accordingly, forward-looking statements should
not be relied upon as representing HCAC’s views as of any
subsequent date, and HCAC does not undertake any obligation to
update forward-looking statements to reflect events or
circumstances after the date they were made, whether as a result of
new information, future events or otherwise, except as may be
required under applicable securities laws. You should not place
undue reliance on these forward-looking statements. As a result of
a number of known and unknown risks and uncertainties, actual
results or performance may be materially different from those
expressed or implied by these forward-looking statements. Some
factors that could cause actual results to differ include, but are
not limited to: (1) the occurrence of any event, change or other
circumstances that could give rise to the termination of the merger
agreement between Daseke and HCAC; (2) the outcome of any legal
proceedings that may be instituted against Daseke or HCAC following
announcement of the proposed transaction and related transactions;
(3) the inability to complete the transactions contemplated by the
merger agreement between HCAC and Daseke due to the failure to
obtain approval of the stockholders of HCAC, consummate the
anticipated debt financing or satisfy other conditions to the
closing of the proposed transaction; (4) the ability to obtain or
maintain the listing of HCAC’s common stock on the Nasdaq Capital
Market following the proposed transaction; (5) the risk that the
proposed transaction disrupts the parties’ current plans and
operations as a result of the announcement and consummation of the
transactions described herein; (6) the ability to recognize the
anticipated benefits of the proposed transaction, which may be
affected by, among other things, competition and the ability of the
combined business to grow and manage growth profitably; (7) costs
related to the proposed transaction; (8) changes in applicable laws
or regulations; (9) the possibility that Daseke or HCAC may be
adversely affected by other economic, business, and/or competitive
factors; and (10) other risks and uncertainties indicated from time
to time in the proxy statement to be filed by HCAC in connection
with the proposed transaction, including those under “Risk Factors”
therein, and other factors identified in HCAC’s prior and future
filings with the SEC, available at www.sec.gov.
No Offer or SolicitationThis news 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 securities in any jurisdiction in which
such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction. No portion of HCAC’s or Daseke’s websites is
incorporated by reference into or otherwise deemed to be a part of
this news release.
Geralyn DeBusk
Halliburton Investor Relations & Communications
972-458-8000
Daseke@HalliburtonIR.com
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