Wednesday, December 11, 2019

Vertiv to List on New York Stock Exchange Through Business Combination with GS Acquisition Holdings


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.

“Platinum Equity, Rob Johnson and his team have done a tremendous job over the last several years positioning Vertiv for long-term success. The Company is exactly the asset we were looking for, with a great position in a good industry, products differentiated by technology, strong organic and inorganic growth potential, and opportunities for sustained improvements over time. Taken together, I am delighted with the near- and long-term prospects for Vertiv and the opportunity this represents for shareowners,” said Mr. Cote.

Tom Gores, Chairman and CEO, Platinum Equity, said, “I’m proud of the work our team has done at Vertiv in positioning it where it is today, and I’m very excited about the new partnership with our friend David and long-time partners at Goldman Sachs. Rob Johnson and the management team have done a tremendous job preparing the company for its next phase of growth.”

“This transaction enables us to accelerate our growth and innovation strategy and broaden our opportunities as we continue to focus on the ever-evolving needs of our customers,” said Vertiv CEO Rob Johnson. “Our partnership with David, who has a proven track record of driving operational improvements and shareholder value, will further enhance our trajectory as we look to capitalize on our strong foundation in a growing industry.”

Platinum Equity Partner Jacob Kotzubei, who will become a board member of the newly listed company, said, “We are pleased to partner with Goldman Sachs and Dave Cote on the next phase of Vertiv’s journey, and to participate in the company’s future success as a meaningful shareholder. We also look forward to working with Dave, Rob and the Vertiv management team to accelerate Vertiv’s product and service leadership in the industry.”

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.

Conference Call Information

Investors may listen to a presentation regarding the proposed transaction on Tuesday, December 10, 2019 starting at 10:30 a.m. ET. The call can be accessed by dialing 1-877-883-0383 (domestic toll-free number) or 1-412-902-6506 (international) and providing the conference ID: 8567556, or asking for the GSAH-Vertiv transaction announcement call. The live webcast of the investor call as well as related presentation materials will be available at https://www.gsacquisition.com/.

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