Jeffrey Smith
to Be Appointed to the Ritchie Bros. Board Upon IAA
Acquisition
VANCOUVER, BC, Jan. 23,
2023 /CNW/ - Ritchie Bros. Auctioneers
Incorporated (NYSE: RBA) (TSX: RBA) ("Ritchie Bros.") today
announced that it has entered into a securities purchase agreement
with Starboard Value LP and certain of its affiliates (together,
"Starboard") pursuant to which Starboard will make a concurrent
$485 million convertible preferred
equity and $15 million common share
investment in Ritchie Bros.
In connection with the investment, Starboard Chief Executive
Officer Jeffrey Smith will be
appointed to the Ritchie Bros. Board of Directors effective
following the later of the required approvals by Ritchie Bros.
shareholders and IAA shareholders in connection with the company's
pending acquisition of IAA, Inc. (the "IAA transaction").
"We welcome Starboard's strategic investment in Ritchie Bros.,
which we believe will provide us with additional financial
flexibility," said Ann Fandozzi, CEO
of Ritchie Bros. "Starboard shares our belief in the potential of
the combination of Ritchie Bros. and IAA. We look forward to
benefitting from Jeff's expertise and working together as we
complete this transaction, which we believe will deliver
significant value to all our shareholders."
"We are excited to become a shareholder of Ritchie Bros. as they
take this important next step to accelerate the company's
transformation and value-creation trajectory," said Mr. Smith. "We
were investors in IAA's parent company prior to its spinout, so we
know IAA well and are strong believers in the fundamentals of the
business and the market opportunities that this transaction
creates. We believe that, with Ritchie Bros.' leadership expertise,
marketplace investments, yard footprint and comprehensive suite of
solutions, they will be able to accelerate growth in each vertical.
We are eager to work with the Ritchie Bros. team to ensure that the
combined company executes on the significant synergy and growth
opportunities outlined by Ritchie Bros. in today's investor
presentation."
Terms of Agreement
Under the terms of the securities purchase agreement, Starboard
has agreed to purchase $485 million
of newly issuable senior preferred shares of Ritchie Bros.,
convertible into common shares with an initial conversion price of
$73.00 per share, representing a
premium of approximately 23% over Ritchie Bros.' volume-weighted
average price over the 10 trading day period ending on January 20, 2023. The preferred shares will carry
an initial 5.5% preferred dividend, which is payable in cash or in
shares at the company's option, and will also be entitled to
participate on an as-converted basis in the company's regular
quarterly common share dividends.
Concurrently, Starboard has also agreed to purchase
approximately $15 million of common
shares in Ritchie Bros. at a purchase price of approximately
$59.72 per share.
The shares underlying Starboard's investment will not be voted
at the Special Meeting of Ritchie Bros. Shareholders to be held
with respect to the IAA transaction.
In the event that the merger between Ritchie Bros. and IAA is
terminated, the company will have the right to redeem the preferred
shares at a redemption price of 102% of par plus accrued and unpaid
dividends.
The completion of the investment by Starboard remains subject to
the satisfaction of customary closing conditions, including the
filing of articles of amendment for the senior preferred shares,
the TSX's acceptance of the proposed terms of the investment,
approval of the listing of the common shares on the NYSE and TSX,
and receipt of customary closing deliverables.
Additional information regarding the investment will be
available on the Form 8-K to be filed by Ritchie Bros. with the SEC
and on SEDAR and which will be available on the investor relations
section of Ritchie Bros.' website.
About Jeffrey Smith
Jeffrey Smith is a Managing
Member, Chief Executive Officer and Chief Investment Officer of
Starboard Value LP. Prior to founding Starboard Value LP, Mr. Smith
was a Partner Managing Director of Ramius LLC, a subsidiary of the
Cowen Group, Inc., and the Chief Investment Officer for the funds
that comprised the Value and Opportunity investment platform. Mr.
Smith was also a member of Cowen's Operating Committee and Cowen's
Investment Committee. Prior to joining Ramius in January 1998, he served as Vice President of
Strategic Development and a member of the Board of Directors of The
Fresh Juice Company, Inc. Mr. Smith began his career in the Mergers
and Acquisitions department at Société Générale. Mr. Smith is
currently the Chair of the Board of Papa John's International, Inc
and on the Board of Cyxtera Technologies, Inc. Mr. Smith was
formerly Chair of the Boards of Starboard Value Acquisition Corp.,
Advance Auto Parts, Inc., Darden Restaurants, Inc. and Phoenix
Technologies Ltd. and formerly a member of the Boards of Perrigo
Company plc., Yahoo! Inc., Quantum Corporation, Office Depot, Inc.,
Regis Corporation, Surmodics, Inc., Zoran Corporation, Actel
Corporation, Kensey Nash Corp., S1 Corp and the Fresh Juice
Company. Mr. Smith graduated from The Wharton School of the
University of Pennsylvania, where he
received a B.S. in Economics.
Advisors
Goldman Sachs & Co. LLC served as lead financial advisor and
Guggenheim Securities, LLC served as co-lead financial advisor to
Ritchie Bros. in connection with the pending acquisition of IAA and
the Starboard investment. Evercore and RBC Capital Markets
also served as financial advisors to the company. Goodwin
Procter LLP, McCarthy Tétrault LLP and Skadden, Arps, Slate,
Meagher & Flom LLP served as legal advisors to Ritchie
Bros.
About Ritchie Bros.
Established in 1958, Ritchie Bros. (NYSE and TSX: RBA) is a
global asset management and disposition company, offering customers
end-to-end solutions for buying and selling used heavy equipment,
trucks and other assets. Operating in a number of sectors,
including construction, transportation, agriculture, energy,
mining, and forestry, the company's selling channels include:
Ritchie Bros. Auctioneers, the world's largest industrial
auctioneer offering live auction events with online bidding;
IronPlanet, an online marketplace with weekly featured auctions and
providing the exclusive IronClad Assurance® equipment
condition certification; Marketplace-E, a controlled marketplace
offering multiple price and timing options; Ritchie List, a self-serve listing service for
North America; Mascus, a leading
European online equipment listing service; Ritchie Bros. Private
Treaty, offering privately negotiated sales; and sector-specific
solutions GovPlanet, TruckPlanet, and Ritchie Bros. Energy. The
Company's suite of solutions also includes Ritchie Bros. Asset
Solutions and Rouse Services LLC, which together provides a
complete end-to-end asset management, data-driven intelligence and
performance benchmarking system; SmartEquip, an innovative
technology platform that supports customers' management of the
equipment lifecycle and integrates parts procurement with both OEMs
and dealers; plus equipment financing and leasing through Ritchie
Bros. Financial Services. For more information about Ritchie Bros.,
visit RitchieBros.com.
Forward-Looking
Statements
This communication contains information relating to a proposed
business combination transaction between Ritchie Bros. Auctioneers
Incorporated ("RBA") and IAA, Inc. ("IAA") in addition to
information relating to the proposed investment into RBA by
Starboard. This communication includes forward-looking information
within the meaning of Canadian securities legislation and
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended (collectively,
"forward-looking statements"). Forward-looking statements may
include statements relating to future events and anticipated
results of operations, business strategies, the anticipated
benefits of the proposed IAA transaction, the anticipated impact of
the proposed IAA transaction on the combined company's business and
future financial and operating results, the expected or estimated
amount, achievability, sources, impact and timing of cost synergies
and revenue, growth, operational enhancement, expansion and other
value creation opportunities from the proposed IAA transaction, the
expected debt, de-leveraging and capital allocation of the combined
company, the anticipated closing date for the proposed IAA
transaction, other aspects of RBA's or IAA's respective businesses,
operations, financial condition or operating results and other
statements that are not historical facts. There can be no assurance
that the proposed IAA transaction will in fact be consummated.
These forward-looking statements generally can be identified by
phrases such as "will," "should," "expects," "plans,"
"anticipates," "could," "intends," "target," "goal," "projects,"
"contemplates," "believes," "predicts," "potential," "continue,"
"foresees," "forecasts," "estimates," "opportunity" or other words
or phrases of similar import.
It is uncertain whether any of the events anticipated by the
forward-looking statements will transpire or occur, or if any of
them do, what impact they will have on the results of operations
and financial condition of the combined companies or the price of
RBA's common shares or IAA's common stock. Therefore, you should
not place undue reliance on any such statements and caution must be
exercised in relying on forward-looking statements. While
RBA's and IAA's management believe the assumptions underlying the
forward-looking statements are reasonable, these forward-looking
statements involve certain risks and uncertainties, many of which
are beyond the parties' control, that could cause actual results to
differ materially from those indicated in such forward-looking
statements, including but not limited to: the possibility that
shareholders of RBA may not approve the issuance of new common
shares of RBA in the transaction or that stockholders of IAA may
not approve the adoption of the merger agreement; the risk that a
condition to closing of the proposed IAA transaction may not be
satisfied (or waived), that either party may terminate the merger
agreement or that the closing of the proposed IAA transaction might
be delayed or not occur at all; the anticipated tax treatment of
the proposed IAA transaction; potential adverse reactions or
changes to business or employee relationships, including those
resulting from the announcement or completion of the proposed IAA
transaction; the diversion of management time on
transaction-related issues; the response of competitors to the
proposed IAA transaction; the ultimate difficulty, timing, cost and
results of integrating the operations of RBA and IAA; the effects
of the business combination of RBA and IAA, including the combined
company's future financial condition, results of operations,
strategy and plans; the failure (or delay) to receive the required
regulatory approval of the transaction; the fact that operating
costs and business disruption may be greater than expected
following the public announcement or consummation of the proposed
IAA transaction; the effect of the announcement, pendency or
consummation of the proposed IAA transaction on the trading price
of RBA's common shares or IAA's common stock; the ability of RBA
and/or IAA to retain and hire key personnel and employees; the
significant costs associated with the proposed IAA transaction; the
outcome of any legal proceedings that could be instituted against
RBA, IAA and/or others relating to the proposed IAA transaction;
restrictions during the pendency of the proposed IAA transaction
that may impact the ability of RBA and/or IAA to pursue
non-ordinary course transactions, including certain business
opportunities or strategic transactions; the ability of the
combined company to realize anticipated synergies in the amount,
manner or timeframe expected or at all; the failure of the combined
company to realize potential revenue, growth, operational
enhancement, expansion or other value creation opportunities from
the sources or in the amount, manner or timeframe expected or at
all; the failure of the trading multiple of the combined company to
normalize or re-rate and other fluctuations in such trading
multiple; changes in capital markets and the ability of the
combined company to finance operations in the manner expected or to
de-lever in the timeframe expected; the failure of RBA or the
combined company to meet financial and/or KPI targets; the failure
to satisfy any of the conditions to closing of the Starboard
investment in RBA; any legal impediment to the payment of the
special dividend by RBA, including TSX consent to the dividend
record date; legislative, regulatory and economic developments
affecting the business of RBA and IAA; general economic and market
developments and conditions; the evolving legal, regulatory and tax
regimes under which RBA and IAA operates; unpredictability and
severity of catastrophic events, including, but not limited to,
pandemics, acts of terrorism or outbreak of war or hostilities, as
well as RBA's or IAA's response to any of the aforementioned
factors. These risks, as well as other risks related to the
proposed IAA transaction, are included in the registration
statement on Form S-4 and joint proxy statement/prospectus filed
with the Securities and Exchange Commission (the "SEC") and
applicable Canadian securities regulatory authorities in connection
with the proposed IAA transaction. While the list of factors
presented here is, and the list of factors presented in the
registration statement on Form S-4 are, considered representative,
no such list should be considered to be a complete statement of all
potential risks and uncertainties.
For additional information about other factors that could cause
actual results to differ materially from those described in the
forward-looking statements, please refer to RBA's and IAA's
respective periodic reports and other filings with the SEC and/or
applicable Canadian securities regulatory authorities, including
the risk factors identified in RBA's most recent Quarterly Reports
on Form 10-Q and Annual Report on Form 10-K and IAA's most recent
Quarterly Reports on Form 10-Q and Annual Report on Form 10-K. The
forward-looking statements included in this communication are made
only as of the date hereof. Neither RBA nor IAA undertakes any
obligation to update any forward-looking statements to reflect
actual results, new information, future events, changes in its
expectations or other circumstances that exist after the date as of
which the forward-looking statements were made, except as required
by law.
No Offer or Solicitation
This communication is not intended to and shall not constitute
an offer to buy or sell or the solicitation of an offer to buy or
sell any securities, or a solicitation of any vote or approval, nor
shall there be any offer, solicitation or 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 offer of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the U.S. Securities Act of 1933, as
amended, or pursuant to an exemption from, or in a transaction not
subject to, such registration requirements.
Important Additional Information
and Where to Find It
In connection with the proposed IAA transaction, RBA filed with
the SEC and applicable Canadian securities regulatory authorities a
registration statement on Form S-4 to register the common shares of
RBA to be issued in connection with the proposed IAA transaction on
December 14, 2022. The registration
statement includes a joint proxy statement/prospectus which will be
sent to the shareholders of RBA and stockholders of IAA seeking
their approval of their respective transaction-related proposals.
Each of RBA and IAA may also file other relevant documents with the
SEC and/or applicable Canadian securities regulatory authorities
regarding the proposed IAA transaction. This document is not a
substitute for the proxy statement/prospectus or registration
statement or any other document that RBA or IAA may file with the
SEC and/or applicable Canadian securities regulatory authorities.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION
STATEMENT ON FORM S-4 AND THE RELATED JOINT PROXY
STATEMENT/PROSPECTUS, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO
THOSE DOCUMENTS AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE
FILED WITH THE SEC and applicable Canadian securities regulatory
authorities IN CONNECTION WITH THE PROPOSED IAA TRANSACTION OR
INCORPORATED BY REFERENCE IN THE PROXY STATEMENT/PROSPECTUS,
CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE,
BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT
RBA, IAA AND THE PROPOSED IAA TRANSACTION.
Investors and security holders may obtain copies of these
documents (when they are available) free of charge through the
website maintained by the SEC at www.sec.gov, SEDAR at
www.sedar.com or from RBA at its website,
investor.ritchiebros.com, or from IAA at its website,
investors.iaai.com. Documents filed with the SEC and applicable
Canadian securities regulatory authorities by RBA (when they are
available) will be available free of charge by accessing RBA's
website at investor.ritchiebros.com under the heading
Financials/SEC Filings, or, alternatively, by directing a request
by telephone or mail to RBA at 9500 Glenlyon Parkway, Burnaby, BC, V5J 0C6, Canada, and documents filed with the SEC by
IAA (when they are available) will be available free of charge by
accessing IAA's website at investors.iaai.com or by contacting
IAA's Investor Relations at investors@iaai.com.
Participants in the
Solicitation
RBA and IAA, certain of their respective directors and executive
officers and other members of management and employees, and
Jeffrey C. Smith, may be deemed to
be participants in the solicitation of proxies from the
stockholders of RBA and IAA in respect of the proposed IAA
transaction under the rules of the SEC. Information about RBA's
directors and executive officers is available in RBA's definitive
proxy statement on Schedule 14A for its 2022 Annual Meeting of
Shareholders, which was filed with the SEC and applicable Canadian
securities regulatory authorities on March
15, 2022, and certain of its Current Reports on Form 8-K.
Information about IAA's directors and executive officers is
available in IAA's definitive proxy statement on Schedule 14A for
its 2022 Annual Meeting of Stockholders, which was filed with the
SEC on May 2, 2022, and certain of
its Current Reports on Form 8-K. Other information regarding
persons who may be deemed participants in the proxy solicitation
and a description of their direct and indirect interests, by
security holdings or otherwise, including information with respect
to Mr. Smith, are contained or will be contained in the joint proxy
statement/prospectus and other relevant materials filed or to be
filed with the SEC and applicable Canadian securities regulatory
authorities regarding the proposed IAA transaction when they become
available. Investors should read the joint proxy
statement/prospectus carefully before making any voting or
investment decisions. You may obtain free copies of these documents
from RBA or IAA free of charge using the sources indicated
above.
Contacts
Investors
Sameer Rathod Vice President,
Investor Relations & Market Intelligence
(510) 381-7584
srathod@ritchiebros.com
Media
Dan Katcher / Lucas Pers / Haley
Salas
Joele Frank, Wilkinson Brimmer
Katcher
(212) 355-4449
View original
content:https://www.prnewswire.com/news-releases/ritchie-bros-announces-500-million-strategic-investment-from-starboard-value-301727989.html
SOURCE Ritchie Bros. Auctioneers