An affiliate of Clayton, Dubilier & Rice, LLC entered into a definitive agreement to acquire Veritiv Corporation (NYSE:VRTV) from funds managed by The Baupost Group, L.L.C. and others for approximately $2.4 billion on August 6, 2023. Under the terms of the agreement, each share of Veritiv common stock issued and outstanding immediately prior to the closing of the transaction will be entitled to receive $170 per share in cash, representing a nearly 31% premium over Veritiv?s 30-day volume-weighted average price of $129.89. Upon the completion of the transaction, Veritiv will become a privately held company and shares of Veritiv common stock will no longer be listed on any public markets. CD&R obtained committed financing from Goldman Sachs, RBC Capital Markets, LLC, Wells Fargo Securities, BMO Capital Markets Corp., and UBS Investment Bank. The Merger will be funded in part with proceeds from (i) a $600 million senior secured term loan facility, (ii) $700 million aggregate principal amount of 10.500% senior secured notes due 2030 and (iii) a borrowing against a $825 million senior secured asset based revolving credit facility. Veritiv Corporation's Board of Directors approved a dividend of $0.63 per share payable on September 13, 2023 to shareholders of record as of the close of business on August 17, 2023. Under the terms of the agreement, assuming the transaction closes on or prior to December 31, 2023, Veritiv will not declare or pay any additional dividends to its shareholders. Upon termination of the Merger Agreement under specified circumstances, including if the Company terminates the Merger Agreement to enter into an alternative acquisition agreement with respect to a Superior Proposal, the Company will be required to pay to Parent a termination fee of $74,446,700. Parent will be required to pay to the Company a termination fee of $148,893,400 if the Merger Agreement is terminated under specified circumstances.

The transaction remains subject to shareholder approval and other customary closing conditions, including the receipt of required regulatory approvals, the expiration or earlier termination of all applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act; the absence of any law, judgment, ruling, action, injunction or order that restrains, enjoins, renders illegal or otherwise prohibits the consummation of the Merger; other customary closing conditions, including the accuracy of each party?s representations and warranties and each party?s compliance with its covenants and agreements contained in the Merger Agreement (subject to certain qualifications as to materiality); and receipt of certain other applicable approvals, clearances or expirations of waiting periods under the antitrust laws of other jurisdictions, and is expected to close in the fourth quarter of 2023. In connection with the transaction, funds managed by Baupost entered into a Support Agreement under which they have agreed to vote their shares in favor of the transaction. Having determined that the offer is in the best interests of the company and its shareholders, Veritiv?s Board of Directors has unanimously approved and voted to recommend that shareholders to vote in favor of the transaction. As of October 17, 2023, Veritiv's shareholders approved the transaction.

Morgan Stanley & Co. LLC served as exclusive financial advisor and Scott Ortwein, Justin Howard, Kerry Wenzel, Charles Morgan, Alison LeVasseur, John Snyder, Paul Hespel of Alston & Bird LLP served as legal counsel to Veritiv. Guggenheim Securities, LLC and Wells Fargo Securities served as lead financial advisors to CD&R, and BMO Capital Markets Corp., Goldman Sachs, RBC Capital Markets, LLC, and UBS Investment Bank also served as financial advisors. Richard J. Campbell, David M. Klein, Rachael G. Coffey, and John Mason Wilkes of Kirkland & Ellis LLP has acted as legal advisor to Clayton, Dubilier & Rice. Steven Slutzky of Debevoise & Plimpton LLP served as legal counsel to CD&R in the financing aspects including $700 million of Senior Secured Notes due 2030. Morgan Stanley & Co. LLC acted as fairness opinion to Veritiv in connection with the transaction. Ropes & Gray LLP acted as legal advisor to The Baupost Group in the transaction. Innisfree M&A Inc. is acting as proxy solicitor to Veritiv and will receive a fee of approximately $30,000 for its services. Computershare, Inc. is the transfer agent for Veritiv.

An affiliate of Clayton, Dubilier & Rice, LLC completed the acquisition of Veritiv Corporation (NYSE:VRTV) from funds managed by The Baupost Group, L.L.C. and others on November 30, 2023.