Breaking news on TransPerfect Global: Just 1-year after the company was “dissolved” and auctioned off by Chancery Court Chancellor Andre Bouchard in what I see as the most radical and corrupt decision in American business law history, TransPerfect is now the darling of Wall Street.
How is it possible that a company deemed the most
“dysfunctional” in the world, requiring a 3-year government
occupation ordered by our own Andre Bouchard’s Chancery Court, $250 million
spent (much of which remains still undisclosed, Mr. Bouchard), and then
dissolved and auctioned off — is now so successful that the world’s leading
banks are happily lending money to it?
It’s clear to me that the whole thing was a LIE. Read the Slator story below about Bank of America, JPMorgan and Citigroup lending TransPerfect hundreds of millions and reflect back on how the Chancery Court treated this company and draw your own conclusions.
As always, your comments are welcome and appreciated. Especially upon reading this news.
TransPerfect Refinances USD 445m Loan Used in 2017 Buyout, Gears Up for M&A
By Florian Faes (20 June 2019)
TransPerfect is cutting its interest expense. The world’s largest language service provider by revenue is refinancing a USD 445m credit facility used to buy out the company’s co-founder Liz Elting after a years-long legal battle ended in late 2017.
In a process that saw him compete against H.I.G. Capital,
private equity owner of arch rival Lionbridge, TransPerfect CEO Phil Shawe
eventually succeeded in gaining sole control of the company he co-founded.
According to a press statement, the new USD 450m credit
facility (consisting of a USD 400m term loan and a USD 50m revolving credit
line) will replace and terminate the previous USD 445m credit facility.The
relatively quick refinancing of a higher-interest loan can be seen as a vote of
confidence in a business that generated USD 705m in revenue and USD 92.3m in
EBITDA in 2018. The new loan will shave off around USD 15m from TransPerfect’s
annual interest expense and was provided by a syndicate arranged by Bank of
America, JP Morgan, and Citibank with Bank of America acting as the sole
administrative agent.
Asked how he is planning to reinvest the funds freed up by
the refinancing, Shawe told Slator that “one of the reasons I was able to put
together a compelling bid for the company, was because I was not interested in
pulling money off the table, so to speak. This USD 15m in savings per year will
be used to finance growth through any or all of the following: M&A,
Technology R&D, Talent Acquisition, Geographic Expansion, and General
Corporate Purposes.”
“We have sufficient ‘dry powder’ to complete a major
acquisition”—Phil Shawe, CEO, TransPerfect.
To maintain its current growth trajectory TransPerfect will
have to diversify into new verticals and offerings. Shawe confirmed that while
he sees continued growth in the company’s traditional business lines, he
expects areas such as “Media, Gaming, AI training and several other areas of
focus for us in 2019/2020” to outperform.
So far TransPerfect has largely stayed on the sidelines
while competitors have been busy doing deals over the past two years. But this
may be about to change. “One of the advantages of this current financing is the
opportunity it has given TransPerfect to forge deeper relationships with
several of the world’s leading banks,” Shawe said. “Given our current leverage
position, we feel very comfortable that we have sufficient ‘dry powder’ to
complete a major acquisition should the right opportunity arise. Fortunately,
because of the investments we’ve made over the years, such in our sales force
and in our technology products, we are not dependent on M&A to drive
growth.”