ADT Announces Pricing of Secondary Public Offering of Common Stock and Concurrent Share Repurchase
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Insights
The secondary public offering by ADT Inc. represents a significant liquidity event for the entities managed by affiliates of Apollo Global Management. As a financial analyst, it's important to note that the pricing of shares at $6.50 can be indicative of market sentiment towards the company and its valuation. The fact that the company is not selling any shares and will not receive proceeds suggests a reallocation of ownership rather than capital raising for corporate activities, which is a neutral event for the company's balance sheet.
Investors should closely monitor the market's reaction to this offering, as it could influence ADT's stock price in the short-term. The additional 30-day option for underwriters to purchase up to 9,750,000 shares could also introduce volatility or support the stock price depending on the demand. The Share Repurchase is a strategic move that indicates management's confidence in the company's value, potentially signaling to the market that the stock is undervalued at the offering price.
From a market research perspective, the involvement of top-tier investment banks as book-running managers and joint book-runners, such as Morgan Stanley and Barclays, adds credibility to the offering. It may also facilitate a broader distribution of shares, potentially increasing the stock's liquidity in the market.
The share repurchase program, part of which is being executed concurrently with the secondary offering, is a tactic often used to return value to shareholders and could be perceived positively by the market. However, it is essential to assess the impact of such repurchases on the company's future growth potential and whether the capital could be better deployed for business expansion.
From a legal standpoint, the effectiveness of the shelf registration statement and the filing of a preliminary prospectus supplement with the Securities and Exchange Commission are standard procedures for secondary offerings. Prospective investors should examine these documents for risk factors and detailed information about the offering. The absence of underwriting fees for the shares being repurchased is a notable point, as it eliminates potential conflicts of interest and could be seen as a cost-saving move by the company.
BOCA RATON, Fla., March 06, 2024 (GLOBE NEWSWIRE) -- ADT Inc. (NYSE: ADT) (“ADT” or the “Company”) today announced the pricing of a secondary public offering of 65,000,000 shares of the Company’s common stock held by certain entities managed by affiliates of Apollo Global Management, Inc. (the “Selling Stockholders”) at a price to the public of
The underwriters will have a 30-day option to purchase up to an additional 9,750,000 shares of common stock from the Selling Stockholders. The Company is not selling any shares and will not receive any proceeds from the offering.
In addition, ADT has authorized the concurrent purchase from the underwriters of 15,000,000 shares of common stock as part of the secondary public offering (the “Share Repurchase”) subject to the completion of the offering. The Share Repurchase is part of the Company’s existing
Morgan Stanley, Barclays, Apollo Global Securities and RBC Capital Markets are acting as book-running managers for the offering. BNP PARIBAS, Deutsche Bank Securities, Mizuho, Goldman Sachs & Co. LLC, MUFG, BMO Capital Markets, BTIG and Raymond James are acting as joint book-runners for the offering. Berenberg, Fifth Third Securities, Academy Securities, Bancroft Capital and Siebert Williams Shank are acting as co-managers for the offering.
A shelf registration statement (including a prospectus) relating to these securities has been filed with the Securities and Exchange Commission (the “Commission”) and is effective. A preliminary prospectus supplement relating to the offering has also been filed with the Commission. Before investing, interested parties should read the shelf registration statement, preliminary prospectus supplement and other documents filed with the Commission for information about ADT and the offering. You may get these documents for free by visiting EDGAR on the Commission’s website at sec.gov. Alternatively, a copy may be obtained from: Morgan Stanley & Co. LLC, Attn: Prospectus Department, at 180 Varick Street, 2nd Floor, New York, New York 10014, Barclays Capital Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone (toll-free): (888) 603-5847 or by emailing: barclaysprospectus@broadridge.com, Apollo Global Securities, 9 West 57th Street, 41st Floor, New York, New York 10019 or RBC Capital Markets, LLC, Attention: Equity Capital Markets, 200 Vesey Street, New York, NY 10281, by telephone at 877-822-4089 or by email at equityprospectus@rbccm.com.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these 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.
About ADT Inc.
ADT provides safe, smart and sustainable solutions for people, homes and small businesses. Through innovative offerings, unrivaled safety and a premium customer experience, all delivered by the largest network of smart home security professionals in the U.S., we empower people to protect and connect to what matters most.
ADT Contacts
Investor Relations: investorrelations@adt.com; 888-238-8525
Media Relations: media@adt.com
Forward-Looking Statements
ADT has made statements in this press release that are forward-looking and therefore subject to risks and uncertainties, including those described below. All statements, other than statements of historical fact, included in this document are, or could be, “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and the applicable rules and regulations of the Commission and are made in reliance on the safe harbor protections provided thereunder. These forward-looking statements relate to, among other things, the proposed secondary public offering of the common stock; the proposed repurchase of shares of the common stock; any stated or implied outcomes with regards to the foregoing; and other matters. Without limiting the generality of the preceding sentences, any time the Company uses the words “expects,” “intends,” “will,” “anticipates,” “believes,” “confident,” “continue,” “propose,” “seeks,” “could,” “may,” “should,” “estimates,” “forecasts,” “might,” “goals,” “objectives,” “targets,” “planned,” “projects,” and, in each case, their negative or other various or comparable terminology, and similar expressions, the Company intends to clearly express that the information deals with possible future events and is forward-looking in nature. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. These forward-looking statements are based on management’s current beliefs and assumptions and on information currently available to management. ADT cautions that these statements are subject to risks and uncertainties, many of which are outside of ADT’s control, and could cause future events or results to be materially different from those stated or implied in this press release, including among others, risks related to and the effect of the proposed secondary public offering of the common stock; activity in repurchasing shares of ADT’s common stock; and risks that are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 and other filings with the Commission, including the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained therein. Any forward-looking statement made in this press release speaks only as of the date on which it is made. ADT undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise.
FAQ
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