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Primavera Capital Acquisition Corporation

Primavera Capital Acquisition Corporation

Jan 6, 2021 by Matt Cianci

PROPOSED BUSINESS COMBINATION: Lanvin Group

ENTERPRISE VALUE: $1.3 billion
ANTICIPATED SYMBOL: LANV

Primavera Capital Acquisition Corporation proposes to combine with Lanvin Group, a Global Luxury Fashion Group.

Lanvin Group, formerly known as Fosun Fashion Group, is the leading global luxury fashion group headquartered in Shanghai, China, managing iconic brands worldwide including Lanvin, Sergio Rossi, Wolford, St. John Knits, and Caruso. Harnessing the power of its unique strategic alliance of industry-leading partners in the luxury fashion sector, Lanvin Group strives to expand the global footprint of its portfolio brands and achieve sustainable growth through strategic investment and extensive operational know-how, combined with an intimate understanding and unparalleled access to the fastest-growing luxury fashion markets in the world.

SUBSEQUENT EVENT – 12/5/22 – LINK

  • Lanvin Group and PCAC announced an $8.0 million upsizing of the previously announced PIPE investment for ordinary shares to be issued by Lanvin Group Holdings Limited, in connection with the Business Combination, bringing the total PIPE investment size to $153.0 million.
  • The closing of the PIPE investment is contingent upon, among other things, the substantially concurrent consummation of the Business Combination and related transactions.

SUBSEQUENT EVENT – 12/2/22 – LINK

  • +On December 2, 2022, the aforementioned parties entered into Amendment No. 4 to the BCA to remove the closing condition of the BCA relating to the minimum amount of cash of at least US$350,000,000.
    • The Sponsor irrevocably surrendered, subject to the closing of the Business Combination and effective immediately prior to the consummation of the Initial Merger, 6,014,375 Class B ordinary shares of PCAC to PCAC for nil consideration, which shares shall be canceled by PCAC immediately upon the surrender thereof, such that after giving effect to the share surrender, the number of Class B ordinary shares of PCAC held by the Sponsor shall be 5,000,000.

SUBSEQUENT EVENT – 11/30/22 – LINK

  • The SPAC recently received letters from Sky Venture Partners L.P., claiming that it has been relieved of its obligations under the Forward Purchase Agreement, dated as of January 4, 2021, between PCAC, Primavera Capital Acquisition LLC (the “Sponsor”) and Sky Venture (the “Sky Venture FPA”), pursuant to which Sky Venture committed to, among other things, purchase 4,000,000 Class A ordinary shares of PCAC and 1,000,000 warrants of PCAC (collectively, the “forward purchase units”) for an aggregate purchase price of US$40,000,000.
    • In consideration of Sky Venture’s commitment to purchase the forward purchase units, the Sponsor transferred 500,000 Class B ordinary shares of PCAC to Sky Venture.
    • Under the Sky Venture FPA, Sky Venture also agreed to vote all of the Class A ordinary shares and Class B ordinary shares held by it in favor of a business combination transaction proposed by PCAC.
    • PCAC’s previously announced proposed business combination with Fosun Fashion Group (Cayman) Limited (“Lanvin Group”), is described in its proxy statement/prospectus dated November 4, 2022, which was filed with the Securities and Exchange Commission and mailed to PCAC shareholders.
    • Sky Venture has now repudiated its obligations under the Sky Venture FPA, including the obligations to purchase the forward purchase units and vote all of the PCAC ordinary shares held by it in favor of the business combination transaction.
  • PCAC believes that Sky Venture’s claims are without merit and that Sky Venture remains bound by all of its obligations under the Sky Venture FPA.
  • Should Sky Venture fail to honor its contractual commitments, PCAC intends to cause the forfeiture of the 500,000 Class B ordinary shares currently held by Sky Venture and vigorously enforce all of PCAC’s rights and pursue all available remedies against Sky Venture, including seeking specific performance of Sky Venture’s commitments pursuant to the Sky Venture FPA.

SUBSEQUENT EVENT – 11/1/22 – LINK

  • The SPAC remove the arrangements relating to the bonus pool of up to 3,600,000 ordinary shares of LGHL for eligible holders of PCAC’s Class A ordinary shares who do not redeem their shares in connection with the transactions contemplated by the BCA
  • As previously disclosed, on March 23, 2022, Fosun Fashion Holdings (Cayman) Limited agreed to subscribe for 3,800,000 LGHL ordinary shares for an aggregate purchase price of $38 million, of which amount $30 million has already been funded to Lanvin Group in advance of the closing of the Business Combination.
    • Subsequently, on October 28, 2022, Fosun Fashion Holdings (Cayman) Limited, Fosun International Limited and certain other parties thereto entered into an Amended and Restated Subscription Agreement, pursuant to which Fosun Fashion Holdings (Cayman) Limited has agreed to subscribe for a total of 13,327,225 LGHL ordinary shares at a price of $10 per share, upsizing its PIPE subscription investment by approximately $95 million, from $38 million to approximately $133 million.
    • The additional approximately $95 million PIPE subscription commitment from Fosun Fashion Holdings (Cayman) Limited will be effected by way of re-investment of all of the repayment proceeds of certain existing shareholder loans that were borrowed by Lanvin Group from Fosun International Limited for working capital purposes.
    • The closing of the PIPE investment by Fosun Fashion Holdings (Cayman) Limited and the other PIPE investors is contingent upon, among other things, the substantially concurrent consummation of the Business Combination.
    • The total PIPE is now $145M
  • As part of the amended Sponsor Deed, the Sponsor shall no longer be required to surrender any Class B ordinary shares of PCAC.

SUBSEQUENT EVENT – 10/17/22 – LINK

  • The Group announced that Meritz Securities Co., Ltd (008560.KS) (“Meritz”), a subsidiary of South Korea-based leading global financial services conglomerate Meritz Financial Group (138040.KS), has committed US$50 million in a private placement ahead of listing.
    • They are also considering an additional investment of up to US$15 million by way of a PIPE subscription, both at the same per-share valuation as applicable to the de-SPAC transaction.
  • Separately, a shareholder of the Group intends to fully convert its existing shareholder loan and accrued interest of approximately US$95 million into shares of the Group at the same per share valuation as applicable to the de-SPAC transaction, further demonstrating the shareholder’s confidence in, and long-term commitment to, the Group’s sustainable growth.
  • With the committed and potential investments from Mertiz and the intended conversion of existing shareholder loans and accrued interest into equity, together with the existing commitments from the PIPE investors and the forward purchase investors, the Group may receive total new equity of up to US$290 million, in addition to cash currently held in PCAC’s trust account of up to US$414 million (assuming no shareholder redemptions).
  • The Enterprise Value as decreased from $1.5 billion to $1.3 billion and the Equity Value decreased from $1.9175 billion to $1.7175 billion

TRANSACTION

  • The transaction values Lanvin Group at a pro forma enterprise value of US$1.5 billion, with a combined pro forma equity value of up to US$1.9 billion.
  • Lanvin Group will receive proceeds of up to US$544 million, including up to US$414 million of cash currently held in PCAC’s trust account, fully committed PIPE subscription and forward purchase agreements of US$130 million in the aggregate from investors including Fosun International Limited, ITOCHU Corporation, Stella International Limited, Baozun Hong Kong Investment Limited, Golden A&A, Aspex Master Fund and Sky Venture Partners L.P.

New Transaction Summary

lanvin new overview

Old Transaction Summary

lanvin

PIPE

  • Subsequent Event – 12/5/22 – Lanvin Group and PCAC announced an $8.0 million upsizing of the previously announced PIPE investment for ordinary shares to be issued by Lanvin Group Holdings Limited, in connection with the Business Combination, bringing the total PIPE investment size to $153.0 million.
  • Fully committed PIPE subscription of US$50 million in the aggregate from investors:
    • Fosun International Limited, ITOCHU Corporation, Stella International Limited, Baozun Hong Kong Investment Limited, Golden A&A
    • PIPE Share price: $10.00

FORWARD PURCHASE AGREEMENT

  • From the 424B4, Aspex Master Fund and Sky Venture Partners L.P have committed to purchase 8 million ordinary shares and 2 million warrants for $80 million, or $10.00/Share

EARNOUT FOR NON-REDEEMING SHAREHOLDERS

  • A bonus pool of 3.6 million PubCo shares will be made available exclusively to PCAC non-redeeming public shareholders.
  • Bonus shares forfeited by redeeming PCAC shareholders will be distributed to non-redeeming PCAC shareholders on a pro-rata basis.
    • All of the shares in the bonus pool will be contributed by Fosun International and Primavera Capital Acquisition LLC, the sponsor of PCAC.

lanvin non redeem

LOCK-UP

  • Company and SPAC
    • 12 months after the Closing Date or after 150 days, the share price equals or exceeds $12.00 for 20/30 trading days

NOTABLE CONDITIONS TO CLOSING

  • The amount of cash and cash equivalents held by PCAC without restriction outside of the Trust Account and any interest earned on the amount of cash held inside the Trust Account being no less than US$350,000,000 and no SPAC Material Adverse Effect has occurred.

NOTABLE CONDITIONS TO TERMINATION

  • By either PCAC or FFG if the Business Combination is not consummated on or prior to the date falling nine (9) months from the date of the BCA or such other date as mutually agreed in writing by FFG and PCAC.
    • On or about 12/23/22

ADVISORS

  • Cantor Fitzgerald & Co. is acting as exclusive financial advisor to Lanvin Group.
  • Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC are acting as joint capital market advisors to Primavera Capital Acquisition Corporation.
  • Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and Cantor Fitzgerald & Co. are acting as joint placement agents on the PIPE.
  • DLA Piper is serving as legal advisor to Lanvin Group.
  • Simpson Thacher & Bartlett LLP is serving as legal advisor to PCAC.
  • Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor to the joint placement agents.

MANAGEMENT & BOARD

Executive Officers

Tong “Max” Chen, 39
Director, Chief Executive Officer & Chief Financial Officer

Mr. Chen is a partner and a founding member of Primavera Capital Group, which he joined in 2010. At Primavera, Mr. Chen is responsible for sourcing, executing and exiting a variety of deals in the consumer and technology sectors, including investments in Alibaba Group, Ant Financial, Cainiao Smart Logistics, Alibaba Local Services Group, iResearch, Vitaco Health and Linksure Global. Prior to Primavera, Mr. Chen worked at the Investment Banking Division of Goldman Sachs in both Hong Kong and New York from 2003 to 2006. Mr. Chen holds a Bachelor of Arts degree in Applied Mathematics from Harvard College. He also received his JD and MBA degrees from Harvard Law School and Harvard Business School, respectively.

 

Board of Directors

Fred Hu, 57
Founder

Dr. Hu is the founding chairman of Primavera Capital Group. Prior to founding Primavera, Dr. Hu held various senior positions at Goldman Sachs from 1997 to 2010, where he was instrumental in building the firm’s franchise in the region and led some of the largest and most significant transactions in the firm’s history. He was a Partner and chairman of Greater China from 2008 to 2010 and a Partner and Co-Head of Investment Banking China from 2004 to 2008. Before that, he held the position of Goldman Sachs’ Chief Economist. From 1991 to 1996, Dr. Hu served as an economist at the International Monetary Fund in Washington, DC, and after that was Co-Director of the National Center for Economic Research and a professor at Tsinghua University. Dr. Hu is currently the Non-executive Chairman of the Board of Yum China Holdings. He is also a board member of ICBC, UBS Group AG, Hong Kong Exchanges and Clearing Limited, China Asset Management, Minsheng Financial Leasing Co., China Medical Board, Chinese International School, Nature Conservancy Asia Pacific Council, China Venture Capital and Private Equity Association, and the Global Advisory of the Council on Foreign Relations. In addition, Dr. Hu sits on the Hong Kong Government’s Strategic Development Committee and the Advisory Committee for the Hong Kong Securities and Futures Commission. Dr. Hu holds a Master in Engineering Science from Tsinghua University, and a Master and Ph.D. in Economics from Harvard University.

Chenling Zhang, 37
Director 

Ms. Zhang is the founder of VCLEANSE, a leading cold-pressed juice company in China. Ms. Zhang founded VCLEANSE in Shanghai, China in 2012, with a vision to inspire healthy lifestyles in China. VCLEANSE is now a key supplier to Alibaba Group’s Freshippo supermarket chain, the China International Import Expo, and other leading hospitality groups and restaurant chains in China. In addition, Ms. Zhang is a key opinion leader among Chinese female entrepreneurs and various healthy lifestyle social groups. VCLEANSE was one of the earliest community partners for Lululemon Athletica in China and Ms. Zhang is currently a Lululemon ambassador. She has also worked with a variety of other global brands on their branding strategies and marketing campaigns in China. Prior to VCLEANSE, Ms. Zhang worked at Audax Private Equity Group in Boston and the Investment Banking Division at Morgan Stanley in New York City from 2005 to 2012. Ms. Zhang received her bachelor’s degree in Applied Mathematics from Harvard University.

Muktesh Pant, 66
Director 

Mr. Pant was Chief Executive Officer of Yum China Holdings from 2016 to 2018 and, since 2018, has served as Vice Chairman and Senior Advisor to Yum China Holdings. He was the President of the China Division of Yum Brands from 2015 to 2016. Mr. Pant held several leadership positions with Yum Brands from 2005 to 2015, including Chief Executive Officer of KFC, Chief Executive Officer of Yum Restaurants International, President of Taco Bell International, and Chief Marketing Officer of Yum Restaurants International. Prior to Yum Brands, Mr. Pant spent over 15 years at Unilever, and subsequently spent a decade at Reebok International where he was the Chief Marketing Officer. Mr. Pant also served as a director of Pinnacle Foods from 2015-2018, where he was also a member of the Audit Committee. Mr. Pant graduated with a B Tech degree in Chemical Engineering from the Indian Institute of Technology, Kanpur in 1976, and is a recipient of the Institute’s Distinguished Alumnus Award.

Teresa Teague, 50
Director 

From 2016 to present, Ms. Teague has served as Co-Founder and Co-CEO of TTB Partners Ltd. From 2008 to 2016, Ms. Teague served as Head of Sponsors, Consumer Retail, TMT and Healthcare, Asia ex Japan at Goldman Sachs International Asia, Hong Kong. Ms. Teague was the Managing Director of the Sponsor Coverage Group at Bank of America, New York from 2006 to 2008. Prior to that, Ms. Teague was the Managing Director of the Financial Sponsors Group at Goldman Sachs, New York. From 1997 to 2005, Ms. Teague held several positions with Goldman Sachs International, London, including Executive Director of the Consumer Retail Group, M&A Advisory Group and the High Yield Capital Markets group. Ms. Teague has an MBA from Harvard Business School and a BA in Political Science from Dartmouth College.

Sonia Cheng, 40
Director

From March 2012 to present, Ms. Cheng has served as an executive director of New World Development Company Limited (“NWD”), a listed public company in Hong Kong (HKEx Stock Code: 0017). She is also a director of certain subsidiaries of NWD and currently oversees NWD’s hotel division. From April 2019 to present, Ms. Cheng has served as a non-executive director of Chow Tai Fook Jewellery Group Limited, a listed public company in Hong Kong (HKEx Stock Code: 1929). Ms. Cheng has served as the chief executive officer of Rosewood Hotel Group since August 2008. She has been the chairman of the advisory committee of the School of Hotel and Tourism Management at The Chinese University of Hong Kong since August 2014. Ms. Cheng obtained a Bachelor of Arts Degree in Applied Mathematics with concentration in Economics from Harvard University in the United States of America in 2003.



ByMatt Cianci