Insights > Guiding a Specialty Hospitality Provider Through a Strategic SPAC Merger and Business Combination

Guiding a Specialty Hospitality Provider Through a Strategic SPAC Merger and Business Combination

Navigating the company through its first SPAC merger, Riveron’s expertise provided critical support through the accounting and filing requirements, ultimately leading the company to a successful IPO.

Challenge

One of the country’s fastest growing private companies, and the largest vertically integrated specialty rental and hospitality services provider for energy companies, wanted to further accelerate its impressive growth trajectory through access to the capital markets. After evaluating various alternatives, the company decided to enter a three-way merger by combining another hospitality provider with a publicly traded special purpose acquisition company (SPAC). This strategic business combination would provide the company and other merging entities with increased financial flexibility, a plan to create long-term shareholder value, and a strong foundation for profitable growth.

The company faced an aggressive timeline to prepare the predecessor and acquiree financial statements and schedules to include in the Form S-4 filing and subsequent amendments with the SEC. Complicating matters further, the company’s systems were antiquated, requiring manual preparation for the filings using data from many disjointed systems. The company was also preparing for an audit and bond offering to occur before the closing of the business combination, which required additional preparation and filings.  With a tight timeframe and limited resources, the company needed help preparing all the necessary filings in order to meet the deadlines.

Following the merger, the newly combined entity faced the additional challenge of implementing a robust, integrated back office, which is a common requirement for emerging growth companies. The comprehensive scope included the accounting, finance, purchasing, and operational functions, and streamlining the company’s disconnected business processes and systems.

How we helped

Riveron was initially recommended by the company’s auditor to guide them through the SPAC merger and streamline processes in order to meet filing requirements. Serving as their technical accounting partner throughout the process, we helped prepare the historical and pro forma financial statements and SEC filings, consolidation packages and supporting schedules, and management discussion and analysis (MD&A). Our team also assisted with the valuation during the merger by coordinating and reviewing deliverables from the valuation firm. In conjunction, we facilitated the auditor’s review of both the company and its new acquisition.

After completing the Form S-4 filing and its subsequent amendments, Riveron supported management in producing combined financial statements for both the company and acquiree and assisted with the audit and bond offering preparation. Post-merger, we worked with the company to improve its financial, accounting, and operational processes and implement the technology required to support a public company.

1

Managed financial reporting requirements and prepared for SPAC merger 

  • Prepared significant acquiree S-X 3-05 audited financial statements included in the Form S-4 filing
  • Prepared Article 11 pro forma financial statements included in the Form S-4 filing
  • Developed management’s first time predecessor MD&A, consolidation packages and supporting schedules
  • Provided responses to auditor requests including technical accounting whitepapers and related SEC comment letter assistance
  • Assisted with the audit while preparing for a bond offering to occur prior to the closing of the business combination
2

Completed required filings for SEC reporting

  • Assisted management in producing combined predecessor financial statements and acquiree statements upon completion of the merger
  • Provided support on specific filings, including the first 10-Q, 10-K, and other technical accounting issues to ensure financial statements were materially correct
  • Coordinated year-end audit review of all financial statements filed
  • Created entries for top-side adjustments and reconciled the amounts with published financial statements
3

Implemented business systems,
led program management,
and optimized back-office processes 

  • Stood up a project management office to manage the Oracle Cloud ERP/EPM solution
  • Led the system integrator selection process for the Oracle Cloud solution
  • Drove the functional design of the ERP/EPM solution and migrated and validated five years of multi structured historical data to the ERP
  • Went live with the Oracle ERP/EPM (financial close and consolidations/planning and forecasting) applications, successfully converting the company’s systems from Quickbooks and Excel to a fully integrated Oracle Fusion Cloud solution
  • Developed an operational dashboard in Tableau with a custom data warehouse to deliver next-day hospitality utilization and estimated revenue metrics (KPIs)

Results

As a combined entity, the company provides a differentiated and comprehensive vertical offering for its customers, providing services ranging from catering to accommodations. It operates more effectively with economies of scale and diversified revenue and is well-positioned to capitalize on future opportunities that drive sustainable growth.  

Riveron’s expertise provided the critical support needed to guide the company through its SPAC merger and navigate the related accounting and filing requirements. The completion of the back-office standup and subsequent integration of applicable systems resulted in streamlined processes with required controls and workflows. Today, the company enjoys an accelerated month-end close process with reduced manual data for accounting, finance, purchasing, and operations, resulting in the ability to operate the business at scale. Management can more effectively monitor operations and financial metrics in real time and drive the reporting and proactive decision-making required of a public company.

Ready to Connect?

Our experienced professionals provide critical support during periods of transition, from operating the accounting function to designing the future state and managing the cutover. Contact us to learn more.