Stratim and Force signed a letter of intent in February that led to today's deal announcement.
Force generated estimated revenues in excess of $160 million in 2022, which represented an increase of over 80% versus the prior year, and its audited results (due to be released in April) are expected to reflect 2022 EBITDA over $60 million, according to the announcement.
As part of the proposed transaction, Force's existing equity holders and management will retain a minimum of 50% of their equity interests and will receive up to an additional $120 million in cash proceeds or additional equity interests, at the option of such equity holders.
The proposed transaction, assuming no redemptions and with pipe financing of $120 million, is expected to raise approximately $183 million, resulting in the combined company having $78 million on the balance sheet and no debt at closing.
Current Force equity holders are expected to own at least 32.9% of the combined company. Stratim Cloud stockholders will own approximately 17.1%, and the SPAC's sponsor and related parties will collectively own approximately 17.1%. The remaining shares of the company will be owned by third party financing parties and any existing Force selling stockholders that elect to receive additional equity instead of cash.
The proposed transaction has been structured as an “Up-C” where former Force equity holders will retain their equity interests in Force and will receive non-economic voting shares of the combined company at closing. Read more.