- Combined annual revenue expected to be approximately $620
million
- Highly synergistic transaction expected to result in
run-rate cost synergies/savings of approximately $10
million
- Atlantic CEO Jeffrey Jagid to remain Chief Executive Officer
of combined company; Staffing 360 Solutions CEO Brendan Flood to
serve as President of Staffing 360 Solutions
- Atlantic will acquire all outstanding shares of Staffing 360
Solutions in a transaction valued at approximately $25
million
Atlantic International Corp. (“Atlantic”) (OTC: ATLN), and
Staffing 360 Solutions, Inc. (“Staffing 360”) (Nasdaq: STAF), both
leading providers of strategic outsourced services and workforce
solutions, today announced that their boards of directors
unanimously approved a definitive agreement under which Atlantic
will acquire all outstanding shares of Staffing 360’s common stock.
The Staffing 360 shareholders will receive 1.202 Atlantic shares
for each Staffing 360 share. Atlantic and Staffing 360 shareholders
will own approximately 90% and 10%, respectively, of the combined
company on a fully diluted basis.
The transaction is expected to close within the next 90 days and
is subject to the approval of Staffing 360’s shareholders and other
customary closing conditions, including regulatory approval. Those
matters, including the record date and meeting date, will be
communicated subsequent to the receipt of SEC approval of related
proxy materials. When complete, Staffing 360 will continue to
operate under its current leadership team and brand as a wholly
owned subsidiary of Atlantic. The record date and the date for the
special meeting of shareholders to vote on the transaction will be
communicated to shareholders in the coming days.
“We have great respect for Staffing 360 and its talented team,
and are enthusiastic about the mutual benefits this transaction
brings to the clients of both entities,” said Atlantic’s CEO
Jeffrey Jagid. “The merger provides a unique opportunity to
increase our business by approximately 50 percent to an annualized
revenue run rate of approximately $620 million and allows us to
become an even bigger force in the broad staffing sector. Our
objective is to build a multibillion-dollar diversified services
company through both organic growth and M&A, and this
transaction is consistent with the achievement of our goals.
“Joining forces provides an expanded suite of services, broader
geographic reach and enhanced professional opportunities for our
combined organization. Together, we are even stronger, and I look
forward to a bright future ahead,” Jagid added.
Brendan Flood, Staffing 360’s CEO, said, “We are excited to join
forces with Atlantic International and its wholly owned operating
subsidiary, Lyneer Staffing Solutions, to become part of a
distinguished, national leader in the sector. Building on
complementary footprints and shared values, our combined company
will be even better positioned to deliver enhanced levels of
service to a growing number of companies throughout the United
States whose management teams recognize the value of outsourcing
and the trends toward engaging flexible workforces. This merger is
a testament to the strengths of our respective brands and the
accomplishments of our dedicated team members.”
Anticipated Benefits to Shareholders from the Merger
- Enhanced scale and liquidity with potential for premium
valuation: With a pro-forma revenue base of approximately $620
million, Atlantic and Staffing 360 shareholders are expected to
benefit from the scale, liquidity and capital alternatives of a
larger combined company. Additionally, larger capitalized human
capital management and workforce solutions companies have
historically carried premium valuations.
- Improved cost structure: The combination of Atlantic and
Staffing 360 is expected to create cost efficiencies and decrease
Atlantic’s operating expense ratio, leading to improved
profitability. Atlantic has identified opportunities to further
enhance operating cost efficiencies in the year following the close
of the transaction.
- Benefit from a more diversified customer base:
Atlantic’s broad customer base has grown organically and through
M&A and is positioned to withstand periods of market
volatility. Together with Staffing 360, the combined company will
serve more than 1,500 customers, with no customer generating more
than 5% of total revenue.
Cautionary Notes on Forward-Looking Statements
This communication contains “forward-looking statements” within
the meaning of the federal securities laws, including Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. In this context,
forward-looking statements often address expected future business
and financial performance and financial condition, and often
contain words such as “expect,” “anticipate,” “intend,” “plan,”
“believe,” “seek,” “see,” “will,” “would,” “target,” similar
expressions, and variations or negatives of these words.
Forward-looking statements by their nature address matters that
are, to different degrees, uncertain, such as statements about the
consummation of the proposed transaction and the anticipated
benefits thereof. These and other forward-looking statements,
including, but not limited to, the failure to consummate the
proposed transaction or to make or take any filing or other action
required to consummate such transaction on a timely matter or at
all, are not guarantees of future results and are subject to risks,
uncertainties and assumptions that could cause actual results to
differ materially from those expressed in any forward-looking
statements. Important risk factors that may cause such a difference
include, but are not limited to, (i) the completion of the proposed
transaction on anticipated terms and timing, including obtaining
shareholder and regulatory approvals, anticipated tax treatment,
unforeseen liabilities, future capital expenditures, revenues,
expenses, earnings, synergies, economic performance, indebtedness,
financial condition, losses, future prospects, business and
management strategies for the management, expansion and growth of
the new combined company’s operations and other conditions to the
completion of the merger, (ii) the ability of Atlantic and Staffing
360 to integrate the business successfully and to achieve
anticipated synergies, risks and costs and (iii) potential
litigation relating to the proposed transaction that could be
instituted against Atlantic, Staffing 360 or their respective
directors, (iv) the risk that disruptions from the proposed
transaction will harm Atlantic’s or Staffing 360’s business,
including current and proposed plans and operations, (v) the
ability of Atlantic or Staffing 360 to retain and hire key
personnel, (vi) potential adverse reactions or changes to business
relationships resulting from the announcement or completion of the
merger, (vii) uncertainty as to the long-term value of Atlantic
common stock, (viii) continued availability of capital and
financing and rating agency actions, (ix) legislative, regulatory
and economic developments and (x) unpredictability and severity of
catastrophic events, including, but not limited to, acts of
terrorism or outbreak of war or hostilities, as well as
management’s response to any of the aforementioned factors. These
risks, as well as other risks associated with the proposed merger,
will be more fully discussed in the joint proxy
statement/prospectus that will be included in the registration
statement on Form S-4 that will be filed with the SEC in connection
with the proposed merger. While the list of factors presented here
is, and the list of factors to be presented in the registration
statement on Form S-4 are, considered representative, no such list
should be considered to be a complete statement of all potential
risks and uncertainties. Unlisted factors may present significant
additional obstacles to the realization of forward-looking
statements. Consequences of material differences in results as
compared with those anticipated in the forward-looking statements
could include, among other things, business disruption, operational
problems, financial loss, legal liability to third parties and
similar risks, any of which could have a material adverse effect on
Atlantic’s or Staffing 360’s consolidated financial condition,
results of operations, credit rating or liquidity. Neither Atlantic
nor Staffing 360 assumes any obligation to publicly provide
revisions or updates to any forward-looking statements, whether as
a result of new information, future developments or otherwise,
should circumstances change, except as otherwise required by
securities and other applicable laws.
About Atlantic International Corp.
Atlantic International Corp. (“Atlantic”) is a leading strategic
staffing, outsourced services, and workforce solutions company
executing a high-growth strategy. Through its principal operating
subsidiary, Lyneer Investments LLC (“Lyneer”), Atlantic’s
approximately 300 employees generated over $400 million in revenue
(for the twelve months ended June 30, 2024). According to Staffing
Industry Analysts, Atlantic is among the top 20 largest national
staffing companies servicing the light industrial, commercial,
professional, finance, direct placement, and managed service
provider verticals. Atlantic provides its customers with complete
HR solutions, operating 40 independent on-site and
vendor-on-premises facilities and paying over 12,000 employees
weekly. For more information about Lyneer Staffing Solutions please
visit www.lyneer.com. For more information about Atlantic
International Corp., please visit
www.atlantic-international.com.
About Staffing 360 Solutions, Inc.
Staffing 360 Solutions, Inc. provides a complete suite of
professional and commercial staffing and employer-of- record HR
services to the accounting, finance, IT, engineering and
administration sectors on a temporary, contract or permanent basis.
For more information, visit www.staffing360solutions.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241104899753/en/
Staffing 360 Roger Pondel or
Natalie Mu PondelWilkinson Inc. (310) 279-5980 rpondel@pondel.com
nmu@pondel.com Atlantic
International Kale Fein (213) 915-6414
kfein@atlantic-international.com
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