NEW YORK and SÃO PAULO,
Dec. 13, 2017 /PRNewswire/ --
Boulevard Acquisition Corp II (NASDAQ: BLVD) ("Boulevard") and
Estre Ambiental S.A. ("Estre") today jointly announced a number of
developments which, taken together, are expected to facilitate the
closing of the previously announced business combination
transaction between Boulevard and Estre (the "Transaction"). The
Transaction is expected to close shortly after Boulevard's
stockholders meeting to approve the Transaction on December 21, 2017.
The developments announced today are in addition to the
amendment to the terms of the Transaction publicly disclosed on
December 8, 2017, which reduced the
number of ordinary shares ("Ordinary Shares") of the public entity
("New Estre") that are issued to Estre's stockholders in the
Transaction from 35.4 million shares to 29.4 million shares,
thereby reducing the equity value being paid for Estre in the
Transaction by approximately 17%. This amendment was a significant
improvement in the financial terms of the Transaction for
Boulevard's stockholders.
The developments being announced today are comprised of the
following:
- A number of unrelated institutional investors have agreed to
purchase in a private placement, Ordinary Shares of New Estre for
an aggregate purchase price of approximately US$130 million, thereby bringing potential gross
proceeds to Estre of between $130
million and $500 million,
depending on the level of redemptions by existing Boulevard
shareholders.
-
- The Ordinary Shares to be purchased in the private placement
will be identical to the Ordinary Shares to be issued to the
existing stockholders of Boulevard and Estre in the Transaction,
which, following the close, are expected to trade on NASDAQ under
the symbol "ESTR."
- While the per share sale price of the Ordinary Shares in the
private placement is $10.00 per
share, the purchasers in the private placement will receive from
New Estre at closing an additional two Ordinary Shares for each 10
shares purchased. Accordingly, approximately 15.6 million Ordinary
Shares will be issued in the private placement. The issuance of 2.6
million incremental shares, in addition to the 13 million shares
issued in respect of the investment of $130
million, will be neutral to Boulevard's other stockholders
in light of the previously agreed forfeiture of shares by
Boulevard's sponsor referred to below.
- In addition, 3,748,600 warrants to purchase Ordinary Shares at
$11.50 per share will be issued as
further consideration to the largest private placement investor.
The issuance of warrants is neutral to Boulevard's other
stockholders due to a corresponding agreement by Boulevard's
sponsor to forfeit an equal number of warrants that it currently
holds.
- It is expected that a registration statement with respect to
the resale of all Ordinary Shares be issued in connection with the
private placement and filed with the U.S. Securities and Exchange
Commission (the "SEC") within 15 business days following the
closing of the Transaction.
- The holders of Estre's principal long-term debt have agreed to
a defined range for the repayment of such debt in connection with
the Transaction from a minimum of $100
million to a maximum of $200
million.
-
- All repayments within this range now or in the future will be
at the same discount as had originally been agreed to by the debt
holders in connection with the Transaction.
- For the purposes of the required repayment to the debt holders,
the proceeds available to Estre as a result of the Transaction will
consist of cash received from the sale of Ordinary Shares in the
private placements referred to above, plus cash remaining in
Boulevard after the making of all payments required to be made in
respect of redeemed shares, and reduced by the amount of fees and
expenses payable in connection with the Transaction.
- In light of the change in the minimum required repayment to the
debt holders described above, and the other developments described
above, Estre and Boulevard have agreed to reduce the minimum cash
amount required to be available at closing of the Transaction to
$130 million. Assuming satisfaction
of all other closing conditions, this change in the minimum cash
condition assures closure of the transaction, notwithstanding the
extent to which Boulevard's existing shareholders choose to redeem
their Boulevard shares.
- In a scenario with no redemptions, the full $370 million will have remained in Boulevard's
trust and at closing Estre will realize $500
million of total proceeds due to the private placement
described above. The incremental proceeds of $130 million from the private placement will be
added to Estre's balance sheet, thereby further reducing net debt
and providing further capital to fund growth.
As announced on December 8, 2017,
Boulevard's sponsor has agreed to forfeit a total of 3.7 million
Boulevard shares it currently holds. One effect of this forfeiture
is to cause the issuance of 2.6 million incremental shares in the
private placement to be neutral for Boulevard's other
shareholders.
In addition, since Estre entered into the Business Combination
Agreement with Boulevard in August
2017, there have been several relevant updates from the
Company, including the following:
- Signed memoranda of understanding to acquire three waste
management companies in Brazil.
- Received ISO 37001 certification, making it the first player in
Brazil's waste industry to receive
international certification for internal controls and integrity
policies.
- Hired a new chief financial officer, Fabio D'Avila, who has
deep experience in financial strategy and planning, having
previously served as CFO of a leading public company in
Brazil.
- Formed a majority independent Board comprised of senior
executives from the waste management industry, including companies
such as Advanced Disposal Services, Inc. (Richard Burke); Waste Management, Inc.
(John Morris); and Wheelabrator
Technologies (Robert Boucher Jr.),
and other experts.
"We are very pleased by the support the transaction is receiving
and look forward to a successful closing next week," said
Sergio Pedreiro, the CEO of Estre.
"We believe that the transaction will provide Estre with a sound
platform for growth as Brazil's
waste management sector continues to consolidate and
institutionalize."
Additional Information
In connection with the proposed Transaction, Boulevard has filed
a definitive proxy statement with the Securities and Exchange
Commission (the "SEC") on December 8,
2017 (the "Proxy Statement") and, on December 8, 2017, commenced mailing the Proxy
Statement and other relevant documents to its stockholders as of
the November 20, 2017 record date for
the special meeting. Boulevard's stockholders are urged to read the
Proxy Statement and other relevant documents that have been or will
be filed with the SEC in connection with the Boulevard's
solicitation of proxies for its stockholders' meeting to be held to
approve the proposed Transaction because the Proxy Statement
contains important information regarding Boulevard, Estre, New
Estre, the Transaction, the agreements related thereto and related
matters. When available, you will be able to obtain copies of all
documents regarding the Transaction and other documents filed by
Boulevard or ESTR with the SEC, free of charge, at the SEC's
website (www.sec.gov) or by sending a request to Boulevard at 399
Park Avenue, 6th Floor, New York, New
York 10022, or by calling Boulevard at (212) 878-3500.
Participants in the Solicitation
Boulevard, Estre and New Estre and their respective directors
and certain of their respective executive officers may be
considered participants in the solicitation of proxies with respect
to the proposed Transaction under the rules of the SEC. Information
about the directors and executive officers of Boulevard is set
forth in the Proxy Statement, which can be obtained free of charge
from the sources indicated above.
Non-Solicitation
This communication shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which the offer,
solicitation or sale would be unlawful prior to the registration or
qualification under the securities laws of any such
jurisdiction.
Forward-looking Statements
This communication includes certain statements that are not
historical facts but are forward-looking statements for purposes of
the safe harbor provisions under the United States Private
Securities Litigation Reform Act of 1995. Forward-looking
statements generally are accompanied by words such as "believe,"
"may," "will," "estimate," "continue," "anticipate," "intend,"
"expect," "should," "would," "plan," "predict," "potential,"
"seem," "seek," "future," "outlook," and similar expressions that
predict or indicate future events or trends or that are not
statements of historical matters. These forward-looking statements
include, but are not limited to, statements regarding forecasts of
financial and performance metrics, projections of market
opportunity, macroeconomic outlook and the expected benefits of the
proposed Transaction. These statements are based on various
assumptions and on the current expectations of Boulevard and Estre
management and are not predictions of actual performance. These
forward-looking statements are subject to a number of risks and
uncertainties, including general economic, political and business
conditions in Brazil; potential
government interventions resulting in changes to the Brazilian
economy, applicable taxes and tariffs, inflation, exchange rates,
interest rates and the regulatory environment; changes in the
financial condition of Estre's clients affecting their ability to
pay for its services; the results of competitive bidding processes,
which could lead to the loss of material contracts or curtail
Estre's expansion efforts; Estre's history of losses; the outcome
of judicial and administrative proceedings to which Estre is or may
become a party or governmental investigations to which Estre may
become subject that could interrupt or limit Estre's operations,
result in adverse judgments, settlements or fines and create
negative publicity; changes in Estre's clients' preferences,
prospects and the competitive conditions prevailing in the
Brazilian waste management; the inability of the parties to
successfully or timely consummate the proposed Transaction,
including the risk that any required regulatory approvals are not
obtained, are delayed or are subject to unanticipated conditions
that could adversely affect New Estre or the expected benefits of
the proposed Transaction or that the approval of the stockholders
of Boulevard and/or the shareholders of Estre for the proposed
Transaction is not obtained; failure to realize the anticipated
benefits of the proposed Transaction, including as a result of a
delay in consummating the proposed Transaction or a delay or
difficulty in integrating the businesses of Boulevard and Estre;
the amount of redemption requests made by Boulevard's stockholders;
the ability of Boulevard or New Estre to issue equity or
equity-linked securities in connection with the proposed
Transaction or in the future, including, without limitation,
pursuant to a private investment in public equity, or PIPE, or
other offering of equity securities, which could dilute the
interests of Boulevard's stockholders; those factors discussed in
Boulevard's Proxy Statement under the heading "Risk Factors," and
other documents of Boulevard filed, or to be filed, with the SEC.
These statements speak only as of the date they are made and none
of Boulevard, Estre or New Estre undertakes any obligation to
update any forward-looking statements contained herein to reflect
events or circumstances which arise after the date of this
communication.
Contacts
For Boulevard:
Todd Fogarty / Aduke Thelwell
Kekst
todd.fogarty@kekst.com or aduke.thelwell@kekst.com
+ 1 (212) 521-4800
For Estre:
Juliana Gilio
Giusti Communication
Juliana.gilio@giusticom.com.br
+55 11 5502-5460
Citigroup Global Markets Inc.:
Neil Shah
neil.shah@citi.com
+1 (212) 723-3264
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SOURCE Boulevard Acquisition Corp. II
