TheStreet, Inc. (Nasdaq: TST), a leading financial news and information company, today announced that it has entered into a definitive merger agreement with TheMaven Inc., a coalition of content producers operating on a shared digital publishing, advertising and distribution platform, by which a subsidiary of TheMaven will acquire all of the outstanding common shares of TheStreet for $16.5 million in cash.
"This is a good outcome for TheStreet's shareholders. For over a year we have had a strategic committee comprised entirely of independent directors tasked with evaluating strategic alternatives for the business with the assistance of a financial advisor. The first step was the successful sale of our RateWatch business in June 2018, followed by the sale of TheDeal and BoardEx which closed earlier this year, followed by a substantial distribution to our stockholders from the proceeds of those sales at the end of April. After taking into account the ongoing development needs and operating costs of the remaining consumer business as a stand-alone public company, we believe this agreement represents the best way to maximize value to TheStreet shareholders," said Eric Lundberg, Chief Executive Officer and Chief Financial Officer of TheStreet.
In addition to a pro-rata portion of the Purchase Price, stockholders of TheStreet will receive additional consideration in connection with the closing of the merger transaction consisting of, (1) a special cash distribution equal to the cash held by the Company immediately prior to the closing less any excluded liabilities as agreed to between the parties; and (2) a contingent value right, or CVR, which will entitle each holder to receive a pro-rata portion of the expected release of funds from the outstanding escrow agreements entered into by the Company in connection with the sale of each its RateWatch and BoardEx/TheDeal businesses.
Stockholders of TheStreet are expected to receive total cash consideration, including payments under the CVR, of $33.0- $34.5 million, or $6.19 - $6.47 per share, which represents an average premium of 7.8% to 12.6%, respectively, over TheStreet's 7-day volume weighted average price of $5.74 as of June 11, 2019, the last trading day before the transaction announcement.
The Agreement was approved by a majority of TheStreet's Board upon recommendation of the special committee of independent directors. The transaction is subject to the approval of a majority of the outstanding shares of common stock in TheStreet under Delaware law and is expected to be submitted for stockholder approval and close in the third quarter of 2019. The Board of Directors of TheStreet has recommended that the stockholders approve the merger agreement and the transactions contemplated by the merger agreement. No other regulatory approvals are expected to be required to complete the transaction.
There is no financing condition for the transaction. Concurrent with the signing of the Agreement, TheMaven, funded through debt financing fully committed by B Riley FBR, Inc., has deposited the Purchase Price into an escrow account with Citibank, N.A., as escrow agent, to be distributed to stockholders of TheStreet upon closing.
Moelis & Company LLC acted as the sole financial advisor to TheStreet on the transaction. Lake Street Capital Markets, LLC rendered a fairness opinion to the Board with respect to the Purchase Price and Orrick, Herrington & Sutcliffe LLP acted as legal advisor to TheStreet.
About TheStreet, Inc.
TheStreet, Inc. (NASDAQ: TST, www.t.st) is a leading financial news and information provider to investors and institutions worldwide. The Company's flagship brand, TheStreet (www.thestreet.com), has produced unbiased business news and market analysis for individual investors for more than 20 years.
About Maven
Maven (maven.io) is a coalition of Mavens, including individual thought-leaders to world-leading independent publishers, operating on a shared digital publishing, advertising, and distribution platform and unified under a single media brand. Based in Seattle, Maven is publicly traded under the ticker symbol MVEN.
