Microvast, Inc. signed a non-binding letter of intent to acquire Tuscan Holdings Corp. (NasdaqCM:THCB) from Polar Asset Management Partners Inc., Weiss Asset Management LP, Stephen A. Vogel and others for $2.4 billion in a reverse merger transaction on November 13, 2020. Microvast, Inc. entered into a definitive merger agreement to acquire Tuscan Holdings Corp. in a reverse merger transaction on February 1, 2021. The transaction reflects an implied equity value of the combined company of $3 billion, based on current assumptions, with a $10.00 per share PIPE subscription price. Tuscan will issue 210 million at closing and an additional 20 million Earn-Out Shares if the daily volume weighted average price of the Common Stock, as reported by Bloomberg Financial L.P. using the AQR function, is greater than or equal to $18.00 for any twenty (20) trading days within a thirty (30) trading day period (or a change of control of Tuscan occurs that results in the holders of Common Stock receiving a per share price equal to or in excess of $18.00), during the period commencing on the date of Closing and ending on the third anniversary of the date of Closing. Upon closing, the combined company will receive up to $822 million in cash, comprised of an oversubscribed $540 million PIPE and up to $282 million in cash held in trust by Tuscan, assuming no redemptions by THCB stockholders. PIPE anchor investors include strategic partner Oshkosh Corporation as well as funds and accounts managed by BlackRock, Koch Strategic Platforms and InterPrivate Investment Partners. Microvasts shareholders and management are rolling over 100% of their equity into the transaction. Upon completion, the existing Microvast shareholders will own 70% stake, the PIPE investors will own 18% stake, Tuscan Holdings shareholders will own 9% stake and Tuscan Holdings Founder shares will be 3% of the combined company. The transaction will result in Microvast becoming a publicly listed company. Upon the closing of the transaction, the combined company will be named Microvast Holdings, Inc. and is expected to be listed on the Nasdaq Stock Market under the new ticker symbol MVST. In case of termination of the transaction, Microvast will pay a termination fee of $63 million. The management and Board of the resulting issuer is expected to be Yang Wu, Chief Executive Officer, Chairman of the Board, Director; Yanzhuan Zheng, Chief Financial Officer, Director; Craig Webster, Director; Arthur Wong, Director; Stanley Whittingham, Director; Stephen Vogel, Director; Ying Wei, Director; Shane Smith, Chief Operating Officer and President, Microvast U.S.; Wenjuan Mattis, Chief Technology Officer; Sascha Rene Kelterborn, Chief Revenue Officer and Managing Director, Microvast EMEA; Shengxian Wu, Chief Executive Office-Microvast China.
Completion of the transaction is subject to, among other things, the execution of a definitive agreement, approval by the two companies' Boards, approval of the transaction by Microvast shareholders and the approval by Tuscans stockholders of the merger and the concurrent PIPE transaction, satisfaction of the conditions stated in the definitive agreement and other customary closing conditions including that the U.S. Securities and Exchange Commission completes its review of the proxy statement, the receipt of certain regulatory approvals, any waiting period (and any extension thereof) under the HSR Act having expired or terminated, listing of shares of Tuscan Holdings to be issued pursuant to the transaction on Nasdaq, resignation of Tuscan Holdings directors, the available cash of Tuscan Holdings being at least equal to $250 million and approval by The Nasdaq Stock Market to list the securities of the combined company. The Boards of Directors for both Microvast and Tuscan have unanimously approved the proposed business combination. The special meeting of Tuscan shareholders to approve the transaction is adjourned from April 30, 2021, to May 10, 2021. As of April 28, 2021, Tuscan Holdings announced that the annual meeting of Stockholders has been adjourned until May 10, 2021 to allow more time for stockholders to vote their shares to approve the proposal on the extension amendment proposal. Tuscan has also extended the deadline for stockholders requesting to convert their shares into a pro rata portion of the funds available in Tuscans trust account to May 6, 2021. Tuscan expects to hold the special meeting of stockholders on or about July 16, 2021 to vote on the transaction. The transaction obtained approval of shareholders of Microvast on February 1, 2021. As of July 6, 2021, special meeting of Tuscan stockholders to approve the proposed business combination with Microvast, Inc. to be held on July 21, 2021. As of July 21, 2021, the stockholders of Tuscan approved all proposals related to the previously announced business combination with Microvast. The transaction is expected to be completed in the second quarter of 2021. As on April 20, 2021, the shareholders of Tuscan are urged to vote in favor of the proposal to extend the date by which the transaction can be consummated from April 30, 2021 to July 31, 2021. As of May 11, 2021, Tuscan Stockholders approved the proposal to extend the date by which Tuscan must complete a business combination from April 30, 2021 to July 31, 2021. The amendment effecting this extension has been filed with the Delaware Secretary of State and extends the time for Tuscan to complete business combination with Microvast, Inc. As of July 21, 2021, the closing of the business combination is anticipated to occur on July 23, 2021. The proceeds of the transaction will fund the buildout of global manufacturing facilities, allow Microvast to fulfill contracted demand from global customers and debt repayment. The previously announced business combination is expected to provide $822 million of gross proceeds to Microvast.
Barclays PLC (LSE:BARC) and Cory Hebenstreit of Houlihan Lokey are acting as financial advisors to Microvast and Alain Dermarkar, Paul Strecker, Brian Dillavou, Harald Halbhuber, Christopher Forrester, John Menke, John Cannon, Larry Crouch, Jordan Altman, John Beahn, Jonathan Cheng and Robert Cardone of Shearman & Sterling LLP acted as legal advisors to Microvast. Morgan Stanley & Co. LLC is acting as financial advisor to Tuscan and will be paid a fee of $5.5 million, EarlyBirdCapital, Inc. is acting as capital markets advisor to Tuscan, and InterPrivate Capital is acting as strategic advisor to Tuscan. Alan Annex of Greenberg Traurig LLP is acting as legal advisor to Tuscan, and Graubard Miller is acting as special SPAC counsel to Tuscan. Ahmed Fattouh, Alan Pinto and Brian Pham of InterPrivate Capital are acting as co-sponsors and senior advisors to Tuscan. Morgan Stanley & Co. LLC is acting as sole placement agent for the PIPE financing. Richard D. Truesdell of Davis Polk & Wardwell LLP is acting as legal advisor to Morgan Stanley & Co. LLC. Morrow & Co., LLC acted as information agent and Mark Zimkind of Continental Stock Transfer & Trust Company acted as transfer agent for Tuscan. Karen Smith of Advantage Proxy, Inc. acted as proxy solicitor to Tuscan and will receive a fee of $25,000.
Microvast, Inc. completed the acquisition of Tuscan Holdings Corp. (NasdaqCM:THCB) from Polar Asset Management Partners Inc., Weiss Asset Management LP, Stephen A. Vogel and others in a reverse merger transaction on July 23, 2021.