Goldman Sachs-Backed Firm Seeks Industrial Deals -- Update
19 May 2018 - 10:34AM
Dow Jones News
By Maria Armental
David Cote, the former longtime chief executive of Honeywell
International Inc., is leading a company backed by Goldman Sachs
Group Inc. that is trying to raise some $600 million to pursue
industrial deals.
Blank-check companies, also known as special purpose acquisition
companies, or SPACs, are listed companies with no assets that raise
money from investors for acquisitions and have become a popular
tool among well-known executives, particularly in the oil
patch.
Mr. Cote led a turnaround of Honeywell in his 14 years as CEO,
building a record of disciplined, well-executed deals that helped
expand the industrial conglomerate's product line.
"We believe Mr. Cote's industry experience and operating
capabilities, paired with Goldman Sachs' unique sourcing
infrastructure and experience investing in public and private
markets, will make us a partner of choice for potential business
combination targets," GS Acquisition Holdings Corp. said Friday in
a securities filing.
The company said it has yet to have substantive discussions with
any acquisition target and could pursue a deal in any business or
industry, according to the filing.
GS Acquisition plans to sell 60 million units, or 69 million
units including those subject to the underwriters' overallotment
option, at $10 each. The company said it intends to trade on the
New York Stock Exchange.
The SPAC is Goldman's first as a sponsor, though it has taken a
dozen or so public on behalf of clients over the years. It will sit
inside Goldman's asset-management arm, which oversees $1.4 trillion
on behalf of pension funds, insurance companies and other big money
managers.
Goldman has been looking for new ways to gather assets as
traditional active investing has fallen out of favor with
investors. In the last few years Goldman has raised money for a
dedicated small-business loan fund and launched its first passive
fund.
Ranaan Agus, who ran Goldman's feared proprietary trading desk
before the financial crisis and is now an executive in its
asset-management arm, will be a director of the new vehicle,
according to the filing. The company expects the board would
ultimately have five directors.
The formation of GS Acquisition serves as the latest example of
activity in the SPAC space. The Wall Street Journal reported in
December there had been almost $14 billion worth of new listed
shares in blank-check companies for the year to date, a record,
outstripping 2007's $12.3 billion global issuance.
Separately, LF Capital Acquisition Corp., another blank-check
company, also filed for an initial public offering on Friday. LF
Capital Acquisition, whose management team includes former BNP
Paribas SA chairman Baudouin Prot, said it would target a "business
in the commercial banking and financial technology industries." LF
Capital also said in a securities filing that it had yet to
initiate substantive discussions with prospective targets.
Liz Hoffman contributed to this article.
Write to Maria Armental at maria.armental@wsj.com
(END) Dow Jones Newswires
May 18, 2018 20:19 ET (00:19 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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