Merger MBAC.U

Syniverse, to Become Publicly Traded via Merger with M3-Brigade Acquisition II Corp.

, SPAC Research

Syniverse, the “world’s most connected company” and the premier global technology provider of mission-critical mobile platforms for carriers and enterprises, announced today that it has entered into a definitive merger agreement with M3-Brigade Acquisition II Corp. (NYSE: MBAC), which will result in Syniverse becoming a publicly traded company.

The transaction implies an initial enterprise value for Syniverse of $2.85 billion, or an enterprise value-to-adjusted 2022E EBITDA multiple of approximately 12.1x, and will provide Syniverse with up to $1.165 billion in cash through a combination of equity and equity-linked capital.

Transaction is expected to significantly enhance balance sheet through $1.165 billion in cash proceeds to company, including a $265 million fully committed PIPE, up to $400 million of cash from M3-Brigade Acquisition II Corp. and a minimum commitment of $500 million from Twilio up to maximum investment of $750 million.

Further, leading institutional investors, including Oak Hill Advisors and Brigade Capital Management, have committed to participate in the transaction through Private Investment in Public Equity (PIPE) commitments totaling $265 million, consisting of $69.2 million of common stock at $10.00 per share and $195.8 million of 7.5 percent dividend convertible preferred stock, with a conversion price of $11.50 per share. The convertible preferred stock provides flexible capital that further strengthens Syniverse’s balance sheet. Existing Syniverse shareholders will roll 100% of their equity in the transaction and are expected to own approximately 40% of the combined company at closing.

Existing investors are rolling 100% of their equity in the business, while investors through PIPE include funds and accounts managed by Oak Hill Advisors and Brigade Capital Management.

Transaction furthers previously-announced strategic partnership with Twilio.

MBAC's sponsor has agreed that a portion of its equity will vest only if the share price of the Company exceeds $12.50 per share over a specified period in accordance with customary provisions. This agreement will enhance alignment of the interests of MBAC’s sponsor with the long-term value creation and performance of Syniverse.

The Boards of Directors of both MBAC and Syniverse have unanimously approved the proposed transaction. The transaction is expected to close before the end of 2021, subject to approval by MBAC stockholders, the expiration of the HSR Act waiting period and other customary closing conditions.

Moelis & Company served as financial advisor to Syniverse and Carlyle and joint placement agent. Syniverse obtained committed debt financing from Barclays, Bank of America, Goldman Sachs, Credit Suisse, Mizuho and Deutsche Bank. Debevoise & Plimpton served as legal counsel for Syniverse and Carlyle. JP Morgan Securities served as financial advisor to MBAC and is serving as lead placement agent in the transaction. Cantor Fitzgerald & Co. acted as a capital markets advisor for MBAC. Wachtell, Lipton, Rosen & Katz served as legal counsel for MBAC.

Centerview Partners served as financial advisor to Twilio, and Kirkland & Ellis and DLA Piper acted as legal counsel.

Upon closing of the transaction, the publicly traded company will be named Syniverse Technologies Corporation and its common stock will be listed on the New York Stock Exchange under ticker “SYNV.”

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