Onex Agrees to Convertible Preferred Stock Investment in Emerald
All amounts in U.S. dollars unless otherwise stated
TORONTO, June 10, 2020 (GLOBE NEWSWIRE) -- Onex Corporation (“Onex”) (TSX: ONEX) today announced an agreement with Emerald Holding, Inc. (“Emerald” or the “Company”), a leading operator of
business-to-business trade shows in the U.S., on a $400 million convertible participating preferred equity (the “Preferred Stock”) investment led by Onex Partners V, Onex’ $7.2 billion fund.
Onex Partners has been a significant shareholder of the Company since 2013. As part of the transaction, Onex Partners V will purchase $263.5 million of the Preferred Stock in an initial
private placement and Emerald will pursue a rights offering for the remaining $136.5 million to the Company’s other common shareholders. Onex Partners V has agreed to backstop the rights
offering, which could increase the Onex group’s total investment in Emerald up to $400 million.
The new capital will significantly strengthen Emerald’s balance sheet, increase liquidity and enable management to focus on executing strategic initiatives as the Company navigates the global COVID-19 pandemic.
“We are extremely pleased to expand our relationship with Onex as they continue to actively support the business and help us position the company for recovery once the impact of COVID-19 is behind us,” said Brian Field, Interim President and Chief Executive Officer of Emerald. “We have continued confidence in our strategic plan and the long-term prospects of our marketplaces. The capital we are raising will substantially aid in our effort to build on the strength of our brands and accelerate new growth opportunities we expect will arise during these uncertain times.”
Emerald expects to use the net proceeds from the investment for a combination of debt repayment and general corporate purposes, including organic and acquisition growth initiatives. The investment will also substantially buttress Emerald’s existing liquidity position.
“We believe Emerald has the platform, strategy and management team to deliver strong performance through future periods of economic recovery and create meaningful long-term stockholder value,” said Kosty Gilis, Managing Director at Onex. “With this investment, Emerald’s enhanced liquidity and strong balance sheet will position the Company to pursue many attractive opportunities that will arise in the coming years. We look forward to continuing to work with the management team to create value for all stakeholders.”