Payoneer Announces Commencement of an Offer to Purchase and Consent Solicitation Relating to its Warrants

Rhea-AI Summary

Payoneer Global Inc. (Nasdaq: PAYO) has launched an offer to purchase all outstanding public warrants at $0.78 per warrant in cash. The company is also seeking consent to amend the Warrant Agreement, allowing redemption of each warrant for $0.70 in cash. Parties representing 65.6% of outstanding warrants have agreed to tender and consent to the amendment. The offer expires on September 9, 2024, unless extended or terminated earlier. As of August 9, 2024, there were 25,158,086 warrants outstanding. Citigroup is acting as the Dealer Manager, while Sodali & Co. is the Information Agent. The offer is subject to certain conditions but not contingent on a minimum number of warrants tendered.

Positive

• Potential reduction in outstanding warrants, simplifying capital structure
• Strong support from warrant holders (65.6% agreed to tender)
• Cash offer provides immediate liquidity for warrant holders

Negative

• Potential cash outflow of up to $19.6 million if all warrants are tendered
• Dilution risk if warrants are exercised instead of tendered

Insights

Financial Analyst

Payoneer's warrant repurchase offer at $0.78 per warrant, coupled with the consent solicitation to amend the Warrant Agreement, signals a strategic move to simplify its capital structure. This action could potentially reduce dilution for existing shareholders if a significant number of warrants are tendered. The guaranteed support from 65.6% of warrant holders ensures the amendment's passage, allowing Payoneer to redeem remaining warrants at a 10% discount. This approach demonstrates financial prudence, as it may result in cash savings for the company. However, the impact on Payoneer's liquidity position needs careful consideration, given the potential cash outlay for this transaction. Investors should weigh the long-term benefits of reduced dilution against the short-term cash expenditure.

Legal Expert

The structure of Payoneer's offer and consent solicitation is carefully crafted to comply with securities regulations. The filing of Schedule TO and the Offer to Purchase with the SEC ensures transparency and provides warrant holders with necessary information to make informed decisions. The 65% consent threshold for amending the Warrant Agreement aligns with standard practices for modifying security terms. The company's proactive approach in securing agreements from a majority of warrant holders (65.6%) demonstrates strategic planning and reduces legal risks associated with the transaction. However, warrant holders should carefully review the terms, as the amendment allows for a lower redemption price, which could be seen as unfavorable to those who don't tender their warrants during the initial offer period.

Market Research Analyst

Payoneer's warrant repurchase initiative reflects a broader trend among companies seeking to optimize their capital structures in the current market environment. This move could potentially enhance Payoneer's attractiveness to institutional investors who prefer cleaner capital structures. The timing of this offer, set to expire on September 9, 2024, gives the market ample time to react and for warrant holders to make decisions. The engagement of Citigroup as the Dealer Manager adds credibility to the transaction. Investors should monitor the market's reaction to this news, as it may impact both Payoneer's common stock (PAYO) and warrant (PAYOW) prices. The success of this offer could set a precedent for other companies with outstanding warrants, potentially influencing market-wide practices in warrant management.

NEW YORK--(BUSINESS WIRE)-- Payoneer Global Inc. (“Payoneer” or the “Company”) (Nasdaq: PAYO) today announced that it has commenced an offer to purchase (the “Offer”) all of its outstanding public warrants (the “Warrants”) to purchase shares of its common stock, par value $0.01 per share, at a purchase price of $0.78 in cash, without interest.

Payoneer is also soliciting consents (the “Consent Solicitation”) to amend the Warrant Agreement, dated August 25, 2020, by and between FTAC Olympus Acquisition Corp. (“FTOC”) and Continental Stock Transfer & Trust Company (“Continental”), as amended by the Assignment, Assumption and Amendment Agreement, dated June 25, 2021, by and among Payoneer, FTOC and Continental (as amended, the “Warrant Agreement”), which governs all of the Warrants, to permit Payoneer to redeem each outstanding Warrant for $0.70 in cash, without interest, which is approximately 10% less than the price applicable to the Offer (such amendment, the “Warrant Amendment”). Pursuant to the terms of the Warrant Agreement, the adoption of the Warrant Amendment will require the consent of holders of at least 65% of the then outstanding Warrants. Parties representing approximately 65.6% of the outstanding Warrants have agreed to tender their Warrants in the Offer and to consent to the Warrant Amendment in the Consent Solicitation, pursuant to a tender and support agreement. Accordingly, because holders of more than 65% of the outstanding Warrants have agreed to consent to the Warrant Amendment in the Consent Solicitation, if the other conditions of the Offer do not occur or, if they occur, are waived, then the Warrant Amendment will be adopted.

The Offer will be open until 12:00 midnight, Eastern Time, at the end of the day on September 9, 2024 (the “Expiration Date”), unless extended or earlier terminated by Payoneer. Tendered Warrants may be withdrawn by holders at any time prior to the Expiration Date. The Offer is not conditioned upon any minimum number of Warrants being tendered in the Offer. The Offer is, however, subject to other conditions described in the Offer and Consent Solicitation.

The Offer and Consent Solicitation are being made pursuant to an Offer to Purchase dated August 12, 2024, and joint Schedule TO/Schedule 13e-3 (the “Schedule TO”), dated August 12, 2024, each of which have been filed with the U.S. Securities and Exchange Commission (“SEC”) and more fully set forth in the terms and conditions of the Offer and Consent Solicitation.

The Company’s common stock and Warrants are listed on The Nasdaq Stock Market LLC under the symbols “PAYO” and “PAYOW,” respectively. As of August 9, 2024, a total of 25,158,086 Warrants were outstanding.

Payoneer has engaged Citigroup Global Markets Inc. (“Citigroup”) as the Dealer Manager for the Offer and Consent Solicitation. Sodali & Co. has been appointed as the Information Agent for the Offer and Consent Solicitation, and Continental has been appointed as the Warrant Agent for the Offer and Consent Solicitation. All questions concerning tender procedures and requests for additional copies of the offer materials, including the letter of transmittal and consent should be directed to Sodali & Co. at (800) 662-5200 (toll free).

Important Additional Information Has Been Filed with the SEC

Copies of the Schedule TO and Offer to Purchase will be available free of charge at the website of the SEC at www.sec.gov. Requests for documents may also be directed to Sodali & Co. at (800) 662-5200 (toll free).

This announcement is for informational purposes only and shall not constitute an offer to purchase or a solicitation of an offer to sell the Warrants. The Offer and Consent Solicitation are being made only through the Schedule TO and Offer to Purchase, and the complete terms and conditions of the Offer and Consent Solicitation are set forth in the Schedule TO and Offer to Purchase.

Holders of the Warrants are urged to read the Schedule TO and Offer to Purchase carefully before making any decision with respect to the Offer and Consent Solicitation because they contain important information, including the various terms of, and conditions to, the Offer and Consent Solicitation.

None of Payoneer, any of its management or its board of directors, or Citigroup, Sodali & Co. or Continental or any other person makes any recommendation as to whether or not Warrant holders should tender Warrants for exchange in the Offer or consent to the Warrant Amendment in the Consent Solicitation. Warrant holders must make their own decision as to whether to tender their Warrants and, if so, how many Warrants to tender.

About Payoneer:

Payoneer is the financial technology company empowering the world’s small and medium-sized businesses to transact, do business, and grow globally. Payoneer was founded in 2005 with the belief that talent is equally distributed, but opportunity is not. It is our mission to enable any entrepreneur and business anywhere to participate and succeed in an increasingly digital global economy. Since our founding, we have built a global financial stack that removes barriers and simplifies cross-border commerce. We make it easier for millions of SMBs, particularly in emerging markets, to connect to the global economy, pay and get paid, manage their funds across multiple currencies, and grow their businesses.

Forward-Looking Statements:

This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995, including statements about the expiration date for the Offer and Consent Solicitation and the effects of the Offer and Consent Solicitation on our capital structure. Forward-looking statements generally relate to future events or Payoneer’s future financial or operating performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expect,” “intend,” “plan,” “will,” “estimate,” “anticipate,” “believe,” “predict,” “potential” or “continue,” or the negatives of these terms or variations of them or similar terminology. Such forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward looking statements. These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by Payoneer and its management, as the case may be, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to: (1) changes in applicable laws or regulations; (2) the possibility that Payoneer may be adversely affected by geopolitical events and conflicts, such as the current conflict between Israel and Hamas, and other economic, business and/or competitive factors; (3) changes in the assumptions underlying our financial estimates; (4) the outcome of any known and/or unknown legal or regulatory proceedings; and (5) other risks and uncertainties set forth in Payoneer’s Annual Report on Form 10-K for the period ended December 31, 2023 and future reports that Payoneer may file with the SEC from time to time. Nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Payoneer does not undertake any duty to update these forward-looking statements. 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240812560744/en/

Investor :

Michelle Wang

investor@payoneer.com

Media:

Alison Dahlman

PR@payoneer.com

Source: Payoneer

FAQ

What is the offer price for Payoneer's (PAYO) warrants in the tender offer?

Payoneer (PAYO) is offering to purchase its outstanding public warrants at $0.78 per warrant in cash, without interest.

When does Payoneer's (PAYO) warrant tender offer expire?

The offer is set to expire at 12:00 midnight, Eastern Time, on September 9, 2024, unless extended or terminated earlier by Payoneer.

How many warrants does Payoneer (PAYO) have outstanding as of August 9, 2024?

As of August 9, 2024, Payoneer (PAYO) had a total of 25,158,086 warrants outstanding.

What percentage of Payoneer (PAYO) warrant holders have agreed to tender their warrants?

Parties representing approximately 65.6% of Payoneer's (PAYO) outstanding warrants have agreed to tender their warrants in the offer and consent to the Warrant Amendment.