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Churchill Capital Corp II (“Churchill II” or “Company”) (NYSE: CCX), a public equity acquisition vehicle, today announced the following updates related to its pending acquisition of Software Luxembourg Holding S.A. (“Skillsoft”), a global leader in digital learning and talent management solutions, and Global Knowledge Training LLC (“Global Knowledge”), a worldwide leader in IT and professional skills development:

Update on CFIUS Approval and Consummation of Business Combination

On May 3, 2021, Prosus N.V. (“Prosus”), a global consumer internet group and one of the largest technology investors in the world, received notice from the Committee on Foreign Investment in the United States (“CFIUS”) that it has approved Prosus’s Second Step equity investment related to Churchill II’s acquisition of Skillsoft and Global Knowledge. This approval brings Prosus’s total investment to $500 million and is an important step towards the consummation of the business combination. Other than certain customary closing conditions, the CFIUS approval completes the required conditions for the investment by Prosus and the effectiveness of a strategic support agreement under which Prosus will provide Churchill II with business development and investor relations support services and allows Prosus to elect the Chairman of the combined company.

The Prosus PIPE, in addition to expected cash on hand at the time of closing, substantially satisfies the minimum cash condition in the Skillsoft merger agreement ($644M) and excludes the benefit of any cash held in trust, net of any redemptions.

Skillsoft and Global Knowledge have performed well since the transaction was announced in October 2020, with combined FY 2021 Adjusted Gross Revenue of $691 million and Adjusted EBITDA of $163 million exceeding our expectations. Their combined results for FY 2021 also included $572 million in Net Revenue and $2,561 million in Net Income. Churchill II is reaffirming the combined FY 2022 outlook for Adjusted Gross Revenue and Adjusted EBITDA in the range of $645-675 million and $155-175 million, respectively.

FY21 Oct.
Est.

FY21 Actual

FY22 Outlook

Adjusted Gross Revenue

$       650-680 

$            691

$       645-675 

Adjusted EBITDA

$       145-165 

$            163

$       155-175 

Churchill II has assembled a world-class board of directors who have highly relevant experience in the education, digital learning, B2B and B2C sectors. The initial seven board members include Helena FoulkesRon HovsepianMichael KleinKaren MillsPeter SchmittLarry Summers, and Jeffrey Tarr. At closing, Prosus will have the right to nominate the Chairman and elect 1-2 additional board members based on their pro forma ownership.

Update on Financial Restatements Related to Warrant Classification

On May 11, 2021, Churchill II filed an amended annual report on Form 10-K/A with respect to the year ended December 31, 2020. The amendment reflects the accounting guidance announced by the Securities and Exchange Committee (“SEC”) which impacts the classification of warrants in financial statements.

The restatement of financial statements outlined in the 10K/A, which has no impact on Churchill II’s previously reported investments held in trust or cash, is in connection with a public statement issued by the SEC on April 12, 2021 on accounting and reporting considerations for warrants issued by special purpose acquisition companies (“SPACs”). Churchill II’s management and the Audit Committee of the Company’s board of directors, after consultation with its advisors and independent registered public accounting firm, concluded that the original financial statements should be restated and no longer be relied upon (see 8-K filed 5/11/21).

The transaction is well on its way towards completion in June. The current record date for the Churchill II shareholder meeting to approve the transaction will be April 28th, 2021 and the special shareholder meeting date will be set shortly.

“This transaction is expected to be completed this quarter and we are excited to create the world’s leading corporate digital learning company,” said Michael S. Klein, Chairman and CEO of Churchill II. “We look ahead to training and reskilling a resilient workforce with the tools to succeed in a rapidly changing job market.”

“We are thrilled to be moving forward with our investment in Skillsoft,” said Patrick Kolek, Chief Operating Officer of Prosus. “We are focused on investing in companies that help improve access to quality education around the world. Skillsoft is positioned to continue to transform digital learning across the global workforce and we look forward to partnering with them on their journey.”

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