TG Venture Acquisition Corp. (TGVC) Merge with The Flexi Group Holdings Ltd. (Private)

Research / By

December 9, 2022

  • TG Venture Acquisition Corp. (TGVC) to merge with the Flexi Group Holdings Ltd. (private) in a transaction valuing the pro forma entity at $205 million in Enterprise Value (*$333.89 million of equity value).
  • TGVC public shareholders will receive 11.50 million PubCo Ordinary shares (1 for 1).
  • TGVC sponsor shareholders will receive 2,889,149 PubCo Ordinary shares (1 for 1).
  • Flexi shareholders will receive equity consideration of $190 million at $10.0 per share
  • Transaction includes 2.90 million earnout shares to Flexi shareholders based on the total annual revenues of PubCo in each of the two fiscal years following the Closing Date.
  • No minimum cash condition.
  • Business combination transaction is targeted to close in the second quarter of 2022.
  • SPAC Details:
    • Unit Structure: 1 share of common stock + 1 warrant
    • #Cash in Trust: $117,964,588 (102.6% of Public Offering)
    • Public Shares Outstanding: 11.50 million shares
    • Private Shares Outstanding: 2,889,149 shares
    • Reported Trust Value/Share: $10.26
    • Liquidation Date: May 5, 2023
  • Name of Target: The Flexi Group Holdings Ltd.
  • Description of Target: Unified in 2022 following a merger of three leading brands, The Flexi Group has a combined 25 years of experience designing, building and operating flexible workspaces in Asia and Australia. The Flexi Group is one of the region’s largest flexible workspace operators with 45 locations in 12 cities and 9 countries including Australia, Singapore, Malaysia, Hong Kong, Thailand, Philippines, Taiwan, Vietnam and Japan. Unlike other flexible workspace operators, The Flexi Group takes an asset-light approach to its real estate ventures, partnering with landlords on joint ventures instead of leasing office space and taking on potentially significant financial obligations under rental agreements. By partnering with The Flexi Group, landlords can offer increased flexibility to tenants, as well as improve greater building engagement by offering them access to events, agile work solutions and bookable meeting and event spaces. The Flexi Group’s multi-brand for a multi-demographic approach is unusual in the industry and creates the opportunity to partner with landlords across a variety of asset classes with differentiated pricing, building, location, and office size preferences, thus allowing each brand to grow strategically across the globe.
  • Announced Date: December 5, 2022
  • Expected Close: “Second Quarter of 2023”
  • Press Release: https://www.sec.gov/Archives/edgar/data/1865191/000173112222002084/e4274_ex99-1.htm
  • Transaction Terms (N/A):
    • Enterprise Value: $205 million 
    • Market Cap Value:  *$333.89 million
  • SPAC Public Shareholder Receive:
    • 11.50 million PubCo Ordinary Shares (1 for 1)
  • SPAC Sponsor Receive:
    • 2,889,149 PubCo Ordinary Shares (1 for 1)
  • Target Shareholders Receive (~*56.9%):
    • Equity consideration of $190 million at $10.0 per share (PubCo Ordinary Shares)
    • Earn-Out: 2.90 million PubCo Ordinary Shares based on revenue during the two-year period after closing date
      • 0.50 million shares if the combined company’s revenue ≥ $40.0 million (ending on 12/31/2023)
      • 2.40 million shares if the combined company’s revenue ≥ $57.0 million (ending on 12/31/2024)
  • PIPE / Financing:
    • None
  • Redemption Protections:
    • None
  • Support Agreement:
    • Standard voting support
  • Lock-up:
    • SPAC sponsor: Standard 6 months post-closing or
      • Early release: If price equals or exceeds $12.00 per share after 150 days post-closing
    • Target Security holders (95% of Merger consideration shares): 6 months post-closing
      • Early Release: if price equals or exceeds $12.00 per share after 150 days post-closing
  • Closing Conditions:
    • No minimum cash condition
    • Termination date: May 5, 2023
    • Audited Financial Statements and PCAOB-compliant unaudited financials of Flexi for the first, second and third quarters of 2022 by January 4, 2023, with respect to the first and second quarters, and January 16, 2023, with respect to the third quarter
    • Other customary closing conditions
  • Termination:
    • No termination fee
    • Other standard termination clauses
  • Advisors:
    • Target Financial Advisors:  ARC Group Limited
    • SPAC Financial Advisors: Marshall & Stevens Transaction Advisory Services LLC
    • Target Legal Advisors: Lucosky Brookman LLP and Conyers Dill & Pearman
    • SPAC Legal Advisors: DLA Piper LLP (US) and Ogier LLP
    • Fairness Opinion Advisors: Marshall & Stevens Transaction Advisory Services LLC
    • SPAC Advisors: TriPoint Capital Management, LLC
  • Financials (N/A):
    • No historical or projected financials provided
  • Comparables (N/A):
    • No valuations provided
  • Management Equity Incentive Plan
    • 10.0% of shares outstanding post-closing

*Denotes estimated figures by CPC

#Reported as on September 30, 2022