Union Acquisition Corp. II (NASDAQ: LATN, LATNU, LATNW)
(“LATN”), a special purpose acquisition company founded by Kyle P.
Bransfield, announced today that its shareholders approved an
extension of the date by which it has to complete an initial
business combination from April 22, 2021 to October 22, 2021 (the
“Extension”) at the extraordinary general meeting of shareholders
held on April 16, 2021. The Extension provides LATN with additional
time to complete the previously announced proposed business
combination (the “Procaps Group Transaction”) with Procaps Group, a
leading integrated international healthcare and pharmaceutical
company.
Kyle P. Bransfield, Chief Executive Officer of Union Acquisition
Corp. II, commented on the results of the meeting: “We are happy to
report that more than 98% of the votes cast by our shareholders
supported the extension, which will allow us to complete our
business combination with Procaps Group, a leading global
pharmaceutical technology and healthcare company based in Latin
America. Moreover, in connection with the extension, a majority of
LATN’s shareholders elected not to redeem their shares and as of
today over $135 million remains in the LATN trust, which reaffirms
our original trajectory to close the business combination during
the third quarter of 2021 and which we believe provides ample room
to support the Procaps Group business plan following closing. This
is a strong testament to the Procaps Group transaction and the
recently reported 33% increase in first quarter unaudited 2020 net
revenues of $78.7 million. Clearly, the Procaps Group’s business is
thriving in today’s healthcare environment and we are excited to
propel their improved financial and operational performance to the
next level.”
On March 31, 2021, Union Acquisition Corp. II, a special purpose
acquisition company (or SPAC) listed on the Nasdaq Stock Market
(NASDAQ: LATN, LATNU, LATNW), and Procaps Group, a leading
integrated international healthcare and pharmaceutical company
announced the execution of a definitive business combination
agreement along with a fully committed $100 million PIPE financing
investment.
The Procaps Group Transaction is expected to be completed in the
third quarter of 2021, subject to, among other things, the approval
by LATN shareholders and the satisfaction or waiver of other
customary closing conditions set forth in the definitive agreement
for the Procaps Group Transaction.
Proposed Business Combination Highlights
- 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.
- 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.
- 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.
- Procaps Group currently employs 5,000 people across 13
countries with a strong history and focus on ESG principles
including resource-saving policies, HR and social programs and
corporate policies.
- Procaps Group generated gross revenue of $388 million and
Adjusted EBITDA of $90 million in 2020 and is on track to reach
$436 million in gross revenue and $105 million in Adjusted EBITDA
in 2021. Procaps Group expects full-year Adjusted EBITDA margin
expansion from 22% in 2019 to 26% in 2021 with strong positive free
cash flow. Approximately 44% of Procaps Group revenue in 2020 was
USD-denominated.
- Transaction represents the first ever Latin American focused
SPAC to include a fully committed and over-subscribed SPAC-related
ordinary share PIPE.
- 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.
- 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.
- Transaction represents attractive entry valuation at 10.75X
estimated 2021 EV/EBITDA multiple versus global CDMO and
pharmaceutical industry comparable companies.
- Combined Company to have an implied initial enterprise value of
approximately $1.1 billion, and expected gross cash proceeds after
closing to include a $100 million fully committed PIPE.
- 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.
- 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.
- 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.”
- On April 12, 2021, Procaps Group appointed Dr. Camilo Camacho
as President of the organization and reported unaudited net
revenues of $78.7 million during the three months ended March 31,
2021, which represents a 33% increase when compared to the same
period for 2020. Additionally, Procaps Group’s management team
expects Q1 gross profit and EBITDA margin to increase when compared
to the same period for 2020.
Procaps Group Business and Operational Highlights
Leading regional pharmaceutical player with global reach and
accomplished management team
- Founded in 1977 by the Minski Family with 5,000+ employees
across 13 countries
- Gross revenue of $388 mm in 2020, and projected $436 mm for
2021
- Innovative delivery technologies transform branded generics
into differentiated products
In-house R&D capabilities driving attractive growth
opportunities
- Avenues for growth with a robust pipeline and a high product
renewal rate
- Focus on differentiated, high margin, and high barrier-to-entry
products
Leading pharmaceutical integral CDMO specialized in
softgels
- A preferred supplier to the global pharmaceutical
companies
- Top 3 global player by softgel production capacity, with strong
growth potential and long-standing reputable clients including
Glaxo, Pfizer and Abbott
Proprietary portfolio of branded Rx and OTC products
- Robust proprietary portfolio with strong growth rates
- 99% of product portfolio is proprietary
Positioned to capitalize on favorable regional
dynamics
- LatAm’s pharma sales expected to outperform global growth
- Healthcare expenditure expected to reach a 7% CAGR from 2020 –
2022
- LatAm’s aging population expected to increase boosting demand
for pharma
Strong history and focus on ESG Principles
- Resource saving polices, HR & social programs and
governance are important to Procaps Group
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 Group has a direct
presence in 13 countries in Latin America and has more than 5,000
collaborators working under a sustainable model. Procaps Group
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 the Company’s investor relations website
investor.procapsgroup.com.
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 Procaps Group Transaction, Procaps Group,
S.A. (the “Company”), 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 transaction
(the “Combined Company”), is expected to file a registration
statement on Form F-4 (the “Form F-4”) with the U.S. Securities and
Exchange Commission (the “SEC”) that will include a proxy statement
of LATN that will also constitute a prospectus of the Company.
LATN, Procaps Group and the Company urge investors, shareholders
and other interested persons to read, when available, 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,
the Company, LATN and the proposed transaction. After the
registration statement is declared effective, the definitive proxy
statement/prospectus to be 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 to be
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
containing the proxy statement/prospectus for the proposed business
combination when it is 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 revenue, gross profits, Adjusted EBITDA
margin and free cash flow; the expected gross cash proceeds from
the transaction; expected future capitalization; the expected
listing of the Ordinary Shares and the closing of the transaction;
expectations relating to Procaps Group’s ability to invest in
growth and new product categories and capitalize on favorable
regional dynamics through organic and inorganic growth; estimated
product launches in next three years; belief that Procaps Group
will be sufficiently capitalized to provide innovative solutions
and drive growth initiatives; expected synergies through
innovation, economies of scale and lower cost of capital; and
expected LatAm pharma sales, healthcare expenditures and boost in
demand from aging LatAm population. Such forward-looking statements
with respect to revenues, earnings, performance, strategies,
synergies, prospects, and other aspects of the businesses of LATN,
Procaps Group, or the Combined Company after 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 Union’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 to be
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.
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version on businesswire.com: https://www.businesswire.com/news/home/20210419005154/en/
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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