Merger GSQD.U

Transfix, Inc. to Become a Publicly Traded Company Through a Business Combination With G Squared Ascend I, Inc.

, SPAC Research

Transfix Inc., a leading digital freight platform, today announced it has entered into a definitive business combination agreement with G Squared Ascend I, Inc. (“G Squared Ascend I”) (NYSE: GSQD), a special purpose acquisition company sponsored by affiliates of G Squared (“G Squared”), a growth-stage venture capital fund manager focused on the technology sector. The closing of the transaction is expected by the end of the first quarter 2022. The combined company is expected to be listed on the NYSE under the ticker symbol “TF."

Transfix is a market-leading, next-generation freight platform transforming the traditional and digital freight sector while bringing transparency, trust, and sustainability to the transportation ecosystem. The company combines deep industry expertise and a best-in-class carrier network with cutting edge technology. The result? Competitive pricing, superior service and reliability, and unmatched intelligence for optimizing the supply chain from start to finish. Today, the world's most recognized brands rely on Transfix's trusted carrier network, including six of the top ten retailers and five of the ten largest food and beverage brands in America. Transfix was named one of Forbes' "Next Billion-Dollar Startups" and is headquartered in the heart of New York City.

The merger marks an exciting and significant next step in a deep, multi-year partnership between Transfix and G Squared, a growth-stage venture capital fund manager with significant focus on the freight-tech sector. The relationship, which began in 2019, has been underscored by diligence, expertise, sustainability, and alignment. G Squared has been consistently impressed with the company’s growth across all key metrics including revenue, new partnerships, and a clear path to sustained profit.

The transaction implies a pro forma enterprise value for Transfix of $1.1 billion. Upon the closing of the transaction, existing Transfix shareholders are expected to own approximately 69% of the combined company, with G Squared Ascend I public stockholders owning approximately 24%, G Squared Ascend I’s sponsor has agreed that 50% of its Transfix shares will be subject to forfeiture depending on post-closing share performance. By aligning compensation incentives with management, this structure represents G Squared’s long-term commitment to the investment. The Transaction will also include a Minimum Cash Condition of $200 million.

In addition to the $345 million cash in trust, G Squared is leading a commitment of an incremental $60 million under Forward Purchase Agreements, plus up to another $50 million under G Squared’s Forward Purchase Agreement to backstop redemptions from G Squared Ascend I’s trust.

Following this transaction, Transfix is expected to have approximately $375 million of cash net of transaction expenses, assuming no redemptions by G Squared Ascend I’s public stockholders to accelerate its growth initiatives. In May, Transfix closed on a $50 million, (5 year) senior secured revolver/credit facility with MidCap Financial. Combining the large ABL facility with the cash to the balance sheet from this transaction provides Transfix approximately $400 million in liquidity which will be used to accelerate growth initiatives by further investing in product innovation and technology, new partnerships, geographic expansion, and strategic and targeted acquisitions. Key areas of focus will include alignment of drop and backhaul, and extending the platform into Less Than Truckload and all areas of managed transportation and logistics.

The ability to leverage its public equity for recruiting, M&A, and other strategic endeavors provides Transfix the opportunity to generate value for our shareholders and accelerate growth.

The boards of directors for both Transfix and G Squared Ascend I have unanimously approved the proposed business combination, which is expected to be completed in the first quarter of 2022, subject to, among other things, the approval by G Squared Ascend I’s stockholders of the merger; satisfaction of the conditions stated in the definitive agreement and other customary closing conditions, including that the U.S. Securities and Exchange Commission (the “SEC”) completes its review of the proxy statement; the receipt of certain regulatory approvals; and approvals to list the securities of the combined company.

Lily Shen, Transfix’s Chief Executive Officer and President, and Drew McElroy, Transfix’s Co-Founder & Chairman of the Board of Transfix, will continue in their current roles along with the rest of the Transfix executive team. J.P. Morgan Securities LLC is serving as financial advisor to Transfix. Latham & Watkins LLP, O’Melveny & Myers, LLP, and McCarter & English, LLP are serving as legal counsel to Transfix.

UBS Securities LLC is serving as capital markets advisor to G Squared Ascend I. Goodwin Procter LLP is serving as legal counsel to G Squared Ascend I.

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