Filed by Union Acquisition Corp. II pursuant to
Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Company: Union Acquisition Corp. II
Commission File No.: 001-39089
Procaps Group Announces Filing of Registration Statement
on Form F-4 in Connection With its Proposed Business Combination with Union Acquisition Corp. II
Company Reaffirms Full Year 2021 Net Revenue Guidance
of $397 Million and Adjusted EBITDA Guidance of $105 Million
Business Combination Remains on Track to Close in
the Third Quarter of 2021
BARRANQUILLA, COLOMBIA – June 21, 2021
– Procaps Group, a leading integrated international healthcare and pharmaceutical company, and Union Acquisition Corp. II (NASDAQ:
LATN, LATNU, LATNW) (“LATN”), a publicly-traded special purpose acquisition company, today announced the filing of a registration
statement on Form F-4 (the “Registration Statement”), which contains a preliminary proxy statement/prospectus, with the U.S.
Securities and Exchange Commission (“SEC”) in connection with their recently announced proposed business combination. The
Registration Statement includes audited financials of Procaps Group for the full fiscal years of 2019 and 2020 and can be found here.
Expected Milestones to Completion of Business
Combination Include:
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Investor and analyst day – August 2021
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Second quarter 2021 financial results – August 2021
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Shareholder vote – September 2021
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Business combination close – September 2021
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Listing on Nasdaq Capital Market under new ticker symbol “PROC” – September 2021
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Management Commentary
“Today’s filing represents a key
de-risking event to close our proposed business combination with LATN in the third quarter of 2021,” said Ruben Minski, Procaps
Founder, Chairman and Chief Executive Officer. “More importantly, the registration statement includes fully audited IFRS financials
for our 2019 and 2020 fiscal years that are consistent with our previously communicated financials utilized during our PIPE roadshow in
the first quarter of 2021. As we close the second quarter of 2021, we remain confident in our revenue and adjusted EBITDA growth trajectories
and based on this, we are reaffirming our full year 2021 net revenue and adjusted EBITDA guidance of $397 million and $105 million, respectively.
“We look forward to sharing more on our
developing story at upcoming institutional investor conferences and our soon to be announced investor and analyst day,” concluded
Minski.
Completion of the business combination, which
is expected to close in the third quarter of 2021, is subject to approval by LATN shareholders and other customary closing conditions,
including the Registration Statement being declared effective by the SEC. The combined company will be led by Ruben Minski, Procaps Group
Founder, Chairman & CEO. Upon closing of the business combination (assuming none of the LATN shareholders redeem any of their LATN
ordinary shares in connection with the approval of the business combination and including the redemption of certain shares held by IFC),
existing Procaps Group shareholders are expected to hold approximately 76% of the combined company, which shares will be subject to certain
lock-up arrangements.
Institutional investors have committed to an
upsized private investment in public equity (“PIPE”) of $100 million in ordinary shares of LATN, which will be converted into
ordinary shares of the combined company upon the closing of the business combination. The PIPE will close concurrently with the business
combination. Subject to any redemptions by LATN shareholders, there is approximately $136.9 million in cash currently held in LATN’s
trust account. It is anticipated that the combined company will have approximately $236.9 million in gross cash proceeds (before transaction-related
expenses and the redemption of certain shares held by IFC) to fund organic growth through capacity expansion, plant improvements, working
capital investments, e-Health platform improvements and R&D expenses, inorganic growth via accretive acquisitions and the redemption
of certain shares from IFC.
While the Registration Statement has not yet
become effective and the information contained therein is subject to change, it provides important information about Procaps Group’s
business and operations, proposed business combination with Union Acquisition Corp. II and the proposals to be considered by the LATN
shareholders.
Additional information about the transaction
including the Registration Statement on Form F-4 can be viewed here: https://investor.procapsgroup.com.
Proposed Business Combination Highlights
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Procaps Group is a family-owned Latin American pharmaceutical company established over 40 years ago that
has grown into a leading integrated pharma company with a presence in 13 countries and product reach in 50 markets modernizing oral drug
delivery technology and manufacturing capabilities.
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Procaps Group’s state-of-the-art manufacturing capabilities provide innovative delivery technologies
protected by an extensive IP moat and supported by industry accolades such as the first FDA-approved pharmaceutical plant in South America
for selling Rx products into the U.S.
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Procaps Group today is the largest pharmaceutical contract development and manufacturing organization
“CDMO” in Latin America and top 3 globally in terms of volume of softgel production capacity.
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As of December 31, 2020, Procaps Group employed over 4,700 people across 13 countries, and has a strong
history and focus on ESG principles including resource-saving policies, HR and social programs and corporate policies.
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Procaps Group generated net revenue of $331 million, Adjusted EBITDA of $85 million and Adjusted EBITDA
on a constant currency basis of $93 million in 2020 and is on track to reach $397 million in net revenue and $105 million in Adjusted
EBITDA in 2021. The adjusted EBITDA figures do not include any one-time add backs specifically for provisions required by IFRS . Procaps
Group expects full-year Adjusted EBITDA margin expansion from 18% in 2019 to 26% in 2021 with strong positive free cash flow. Approximately
44% of Procaps Group revenue in 2020 was USD-denominated.
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Transaction represents the first ever Latin American focused SPAC to include a fully committed and over-subscribed
SPAC-related ordinary share PIPE.
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Transaction is expected to enable further investment in growth and new product categories and positions
Procaps Group to capitalize on favorable regional dynamics through organic growth in B2B & B2C segments.
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Transaction also positions the Company to drive inorganic growth through a roll-up strategy focused on
mid-sized companies in the region. The Company’s M&A plan will focus on pharma and CDMO targets, as well as the possibility
for transformational acquisitions in the future.
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Transaction represents attractive entry valuation at 10.75X estimated 2021 EV/EBITDA multiple versus global
CDMO and pharmaceutical industry comparable companies.
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Combined company to have an implied initial enterprise value of approximately $1.1 billion, and expected
gross cash proceeds of $236.9 million (before transaction-related expenses and the redemption of certain shares held by IFC) after closing,
including a $100 million fully-committed PIPE.
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Combined company strategically positions Procaps Group as a differentiated Latin American integrated pharma
company leveraging a proprietary and proven M&A strategy that has the potential to deliver significant Adjusted EBITDA growth and
margin expansion.
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The PIPE was raised from a broad group of Latin American investors, healthcare investors and thought leaders.
These include pan-regional funds such as Moneda Asset Management, as well as Chilean-based Consorcio Seguros, among several other unnamed
global and healthcare investors.
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Transaction is expected to close in the third quarter of 2021, with the combined company expected to be
listed on the Nasdaq Capital Market under the symbol “PROC.”
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Procaps Group Business and Operational Highlights
Leading regional
pharmaceutical player with global reach and accomplished management team
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Founded in 1977 by the Minski Family with 4,700+ employees across 13 countries as of December 31, 2020
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Net revenue of $331 mm in 2020 and projected $397 mm for 2021
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Innovative delivery technologies transform branded generics into differentiated products
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In-house R&D
capabilities driving attractive growth opportunities
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Avenues for growth with a robust pipeline and a high product renewal rate
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Focus on differentiated, high margin, and high barrier-to-entry products
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Leading pharmaceutical
integral CDMO specialized in softgels
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A preferred supplier to the global pharmaceutical companies
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Top 3 global player by softgel production capacity, with strong growth potential and long-standing reputable
clients including Glaxo, Pfizer and Abbott
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Proprietary
portfolio of branded Rx and OTC products
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Robust proprietary portfolio with strong growth rates
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99% of product portfolio is proprietary
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Positioned to
capitalize on favorable regional dynamics
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LatAm’s pharma sales expected to outperform global growth
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Healthcare expenditure expected to reach a 7% CAGR from 2020 – 2022
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LatAm’s aging population expected to increase boosting demand for pharma
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Strong history
and focus on ESG Principles
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Resource saving polices, HR & social programs and governance are important to Procaps Group
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About Procaps Group
Procaps Group is a developer of pharmaceutical and
nutraceutical solutions, medicines, and hospital supplies that reach more than 50 countries in all five continents. Procaps has a direct
presence in 13 countries in Latin America and, as of December 31, 2020, had more than 4,700 collaborators working under a sustainable
model. Procaps develops, manufactures, and markets over-the-counter (OTC) and prescription drugs, nutritional supplements and high-potency
clinical solutions. For more information, visit www.procapsgroup.com or Procaps Group’s
investor relations website investor.procapsgroup.com, which will also contain a link
to the Registration Statement. The Registration Statement includes audited consolidated financial statements of Procaps Group as of and
for the fiscal years ended December 31, 2020 and 2019.
About Union Acquisition Corp. II.
Union Acquisition Corp. II, led by Kyle Bransfield,
is a Cayman Islands exempted company incorporated as a blank check company for the purpose of entering into a merger, share exchange,
asset acquisition, share purchase, recapitalization, reorganization or other similar business combination with one or more businesses
or entities. For more information, please click here.
Important Information About the Merger and Where to Find It
In connection with the proposed business combination,
Procaps Group, S.A. (“Holdco”), a subsidiary of Crynssen Pharma Group Limited (“Procaps Group”) that will be become
the holding company of LATN and Procaps Group as of the closing of the proposed business combination, filed a Registration Statement on
Form F-4 (the “Form F-4”) with the U.S. Securities and Exchange Commission (the “SEC”) that includes a proxy statement
of LATN that also constitutes a prospectus of Holdco. LATN, Procaps Group and Holdco urge investors, stockholders and other interested
persons to read the Form F-4, including the preliminary proxy statement/prospectus and amendments thereto and the definitive proxy statement/prospectus
and documents incorporated by reference therein, as well as other documents filed with the SEC in connection with the proposed transaction,
as these materials will contain important information about Procaps Group, Holdco, LATN and the proposed business combination transaction.
After the Registration Statement is declared effective, the definitive proxy statement/prospectus included in the Registration Statement
will be mailed to shareholders of LATN as of a record date to be established for voting on the proposed business combination. Once available,
shareholders will also be able to obtain a copy of the Form F-4, including the proxy statement/prospectus, and other documents filed with
the SEC without charge, by directing a request to: BTG Pactual US Capital, LLC, Attention: Prospectus Department, Email: OL-BTGPactual-ProspectusDepartment@btgpactual.com.
The preliminary and definitive proxy statement/prospectus included in the registration statement, once available, can also be obtained,
without charge, at the SEC’s website (www.sec.gov).
Participants in the Solicitation
LATN and Procaps Group and their respective directors
and executive officers may be considered participants in the solicitation of proxies with respect to the proposed business combination
described in this press release under the rules of the SEC. Information about the directors and executive officers of LATN is set forth
in LATN’s final prospectus filed with the SEC pursuant to Rule 424(b) of the Securities Act of 1933, as amended (the “Securities
Act”) on October 17, 2019, and is available free of charge at the SEC’s website at www.sec.gov
or by directing a request to: Union Acquisition Corp. II, 1425 Brickell Ave., #57B, Miami, FL 33131. Information regarding the persons
who may, under the rules of the SEC, be deemed participants in the solicitation of the LATN shareholders in connection with the proposed
business combination will be set forth in the Registration Statement filed with the SEC. These documents can be obtained free of charge
from the sources indicated above.
Forward-Looking Statements
This press release contains “forward-looking
statements.” Forward looking statements may be identified by the use of words such as “forecast,” “intend,”
“seek,” “target,” “anticipate,” “believe,” “expect,” “estimate,”
“plan,” “outlook,” and “project” and other similar expressions that predict or indicate future events
or trends or that are not statements of historical matters. Such forward-looking statements include projected financial information, including
2021 net revenue, Adjusted EBITDA and Adjusted EBITDA margin guidance; the expected gross cash proceeds from the Procaps Group business
combination and its effects on expansion; expectations relating to the growth of Procaps Group’s B2B and B2C business, capacity
expansion, plant improvements, working capital investments, e-health platform and R&D expenses; expectations related to potential
M&A acquisitions; the closing of the business combination transaction; and expectations relating to Procaps Group’s ability
to invest in growth through organic and inorganic growth. Such forward-looking statements with respect to revenues, earnings, performance,
strategies, synergies, prospects, and other aspects of the businesses of LATN, Procaps Group, or Holdco, prior to or following the completion
of any proposed business combination, are based on current expectations that are subject to risks and uncertainties. A number of factors
could cause actual results or outcomes to differ materially from those indicated by such forward-looking statements. These statements
involve risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to be materially
different from the information expressed or implied by these forward-looking statements. Although we believe that we have a reasonable
basis for each forward-looking statement contained in this press release, we caution you that these statements are based on a combination
of facts and factors currently known by us and our projections of the future, about which we cannot be certain. Forward-looking statements
in this press release include, but are not limited to: (1) the inability to complete the transactions contemplated by the proposed business
combination; (2) the inability to recognize the anticipated benefits of the proposed business combination, which may be affected by, among
other things, competition, and the ability of the combined business to grow and manage growth profitably; (3) the inability to successfully
retain or recruits officers, key employees, or directors following the proposed business combination; (4) effects on LATN’s public
securities’ liquidity and trading; (5) the market’s reaction to the proposed business combination; (6) the lack of a market
for LATN’s securities; (7) LATN’s and Procaps Group’s financial performance following the proposed business combination;
(8) costs related to the proposed business combination; (9) changes in applicable laws or regulations; (10) the possibility that LATN
or Procaps Group may be adversely affected by other economic, business, and/or competitive factors; and (11) other risks and uncertainties
indicated from time to time in documents filed or to be filed with the SEC by LATN. We cannot assure you that the forward-looking statements
in this press release will prove to be accurate. These forward-looking statements are subject to a number of significant risks and uncertainties
that could cause actual results to differ materially from expected results, including, among others, the ability to complete the business
combination due to the failure to obtain approval from LATN shareholders or satisfy other closing conditions in the business combination
agreement, the occurrence of any event that could give rise to the termination of the business combination agreement, the ability to recognize
the anticipated benefits of the business combination, the outcome of any legal proceedings that may be instituted against LATN or Procaps
Group following announcement of the proposed business combination and related transactions, the impact of COVID-19 on Procaps Group’s
business and/or the ability of the parties to complete the business combination, the ability to obtain or maintain the listing LATN’s
ordinary shares on Nasdaq following the proposed business combination, costs related to the proposed business combination, changes in
applicable laws or regulations, the possibility that LATN or Procaps Group may be adversely affected by other economic, business, and/or
competitive factors, and other risks and uncertainties, including those to be included under the header “Risk Factors” in
the Form F-4 filed with the SEC and those included under the header “Risk Factors” in the final prospectus of LATN related
to its initial public offering, as well as LATN’s other filings with the SEC. Should one or more of these risks or uncertainties
materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these
forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required under applicable securities laws. Accordingly, you should not put undue
reliance on these statements.
Non-Solicitation
This press release is not a proxy statement or solicitation
of a proxy, consent or authorization with respect to any securities or in respect of the proposed business combination and shall not constitute
an offer to sell or a solicitation of an offer to buy any securities nor shall there be any sale of securities in any state or jurisdiction
in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such
state or jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of the Securities
Act.
Procaps Group Investor Contact:
Chris Tyson/Doug Hobbs
SPAC Alpha IR+
(949) 491-8235
LATN@mzgroup.us
LATN Contact:
Kyle P. Bransfield
Chief Executive Officer
Union Acquisition Corp. II
(305) 306-2522
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