20Cube, A Singapore-based software-enabled international supply chain orchestrator, for a proposed business combination between Evo and 20Cube.
The parent company following the merger of the business combination will be a new Singapore holding company (the "Combined Company" or "Pubco") to be called 20Cube Logistics Solutions Ltd., and will be led by Mahesh Niruttan, Founder and CEO of 20Cube. Pubco's ordinary shares are expected to be listed on the Nasdaq Capital Market under the ticker symbol "TCUB".
The Combined Company will also receive up to $125 million (less transaction expenses) of the amounts held in 20Cube's trust account at the closing of the Transaction, subject to any redemptions by existing Evo shareholders and any applicable excise or other tax obligations.
Key Transaction Terms
The transaction values the Combined Company at an implied enterprise value of US$338 million, assuming no redemptions by Evo public shareholders and that all 20Cube shareholders vote to participate in the Business Combination.
The Combined Company will receive up to $135 million in net cash proceeds immediately after concluding, assuming a proposed $20 million subordinated convertible note investment by affiliates and relationships of Evolution Capital Management is negotiated, finalized and consummated.
Such venture is subject to the final negotiation of terms and the execution of definitive documents.
In addition, Evo Fund and certain of its partners have delivered a term sheet to Evo and 20Cube outlining the conditions by which Evo Fund or such affiliates would enter into an equity line for $75 million in Pubco ordinary shares to further sustain its growth strategy. The term sheet provides that Pubco would have the right, without obligation, at Pubco's sole discretion, to sell and issue up to $75 million of its ordinary shares to Evo Fund over a period of 36 months beginning from when the SEC declares the registration statement for the resale of such shares effective, subject to certain ownership, pricing and volume limitations and conditions, and subject in all respects to the negotiation and execution of a definitive agreement between the respective parties.
Assuming no redemptions by Evo's public shareholders and assuming that all 20Cube shareholders elect to participate in the Business Combination as Sellers, it is estimated that the current shareholders of 20Cube will own approximately 59 per cent of the issued and outstanding shares in the Combined Company at closing.
Following the finalization of the transaction, the Combined Company will report in the United States as a foreign private issuer, and as such will not be subject to the same disclosure and certain other obligations applicable to domestic public companies.
In addition, the Combined Company expects to follow home country governance requirements, to the extent permitted by the rules of Nasdaq.
The Transaction has been approved by each of Evo's and 20Cube's Board of Directors. The Transaction is subject to the approval of Evo and 20Cube shareholders and other customary conditions and is expected to close in the first quarter of 2023.
"For more than 10 years, 20Cube has worked closely with our customers to craft this platform", said Mahesh Niruttan, Founder and CEO of 20Cube. "It was exciting to watch us pass through our first growth inflection point a couple of years ago and today is a major milestone towards continuing that rapid growth on our journey to 'make trade better'."
Richard Chisholm, Evo's Chief Executive Officer commented, "20Cube has built a strong foundation with some of the world's most discerning customers. We were most impressed that they achieved profitability and margins on par with the best logistics companies on the planet and did so with limited scale and limited capital." Evo's Managing Director Jason Sausto added, "The company will now be able to put its foot on the gas for multiple initiatives including increasing its customer list in Asia, enhancing US and EU trade lanes, ramping up marketing and commercial teams, building next generation tech and expanding share of wallet with the current base."
20Cube is a software-enabled international supply chain orchestrator from purchase order (PO) to point of delivery (POD) with a technology-driven, proven proprietary system and key presence at over 60 locations in Asia, Australia and East Africa. 20Cube has over 600 employees. 20Cube was built from the ground up over the past 10 years on a disruptive software, workflow and control tower driven platform. 20Cube's platform is centered aroundMyHubPlus, which captures data from every part of the supply chain to provide customers with unprecedented real-time visibility, alerts, exception management and reporting.
Its suite of freight forwarding, intelligent warehousing/distribution, customs and trade compliance solutions have resulted in significant savings from better container utilization, load balancing, predictability and logistics process management.