Special purpose acquisition company One Madison (OMAD) has entered a definitive agreement with affiliates of Rhône Capital to merge with protective packaging solutions firm Ranpak for $950m in cash.
Based in the US, Ranpak offers sustainable protective packaging solutions to products offered by commerce and industrial supply chains.
Leveraging a platform of 90,000 machines, the company sells value-added consumables to approximately 30,000 clients in more than 40 countries.
The total consideration of $950m covers the repayment of existing first and second lien debt.
OMAD will fund the transaction and related expenses with $300m cash held in trust, approximately $407m of debt drawn from $650m of committed new debt, and approximately $292m of committed equity investments from its anchor investors.
The deal is expected to introduce the packaging firm as a publicly listed company for an enterprise value of approximately $1.89bn.
The boards of directors of OMAD and Rhône Capital have approved the transaction, which is currently subject to approval by OMAD shareholders, regulatory approvals and other customary closing conditions. It is expected to close at the beginning of next year.
Ranpak president and CEO Mark Borseth said: “We look forward to working closely with the One Madison team to combine their capital allocation expertise and deal-making acumen with our unique asset-light distribution model, track record of innovation, and industry-leading position to expand our customer base, product offering, and geographic reach.”
Following the completion of the transaction, One Madison Group chairman and CEO Omar Asali will act as the executive chairman of Ranpak, while Mark Borseth will continue to serve as its president and CEO.
OMAD will work with Ranpak to explore growth opportunities for the packaging firm.
The transaction will also offer additional financial resources to support Ranpak’s growth plans such as innovation, geographic expansion and product line extension.