Ross CH Acquisition II is bringing $115 million to Reservoir’s public offering as part of the deal. Some institutional investors including Caledonia have been lined up as anchor shareholders, which will bring in $150 million in gross proceeds.
In the end, after investment banking, legal fees and other expenses, Reservoir will be left with $246 million in gross proceeds from the transaction. The company’s current shareholders, including the Khosrowshahi family, will roll over all their Reservoir equity into the new company, giving it an enterprise value of $788 million.
That means that the Reservoir shareholders will likely have a lock-up period -- maybe 180 days -- before they can cash in any of their shares. In the meantime, the company has an implied pro-forma equity value of $740 million at $10 a share, according to the announcement, which further implies it also has $48 million in net debt.