Universal Technical Institute, Inc. Announces Conversion of All Series A Preferred Stock into Common Stock

Rhea-AI Summary

Universal Technical Institute, Inc. (NYSE: UTI) achieved the conversion of all Series A Preferred Stock into Common Stock, increasing outstanding Common Stock by 19.3 million shares. The company also appointed Chris Shackelton, Co-founder and Managing Partner of Coliseum Capital Management, LLC, to the board as a Class III director. UTI's CEO, Jerome Grant, and Chris Shackelton expressed gratitude for the partnership and highlighted the company's progress and potential for building shareholder value.

Insights

Financial Analyst

Converting preferred stock into common stock can be a significant event for a company and its shareholders. In the case of Universal Technical Institute, Inc., this conversion increases the outstanding common stock by 19.3 million shares. This action dilutes existing common shareholders' equity but may also reflect the company's confidence in its financial stability and future prospects.

The repurchase of shares from Coliseum Capital Management prior to the conversion is a strategic move. It could indicate that the company negotiated a favorable buy-back price, which might be seen as a positive sign for the company's capital management.

The appointment of Chris Shackelton to the board as a Class III director is noteworthy due to his affiliation with Coliseum, a significant investor in UTI. His experience and previous involvement with the company could provide valuable insights and guidance, potentially benefiting the company's strategic direction and governance.

Industry Analyst

The workforce solutions sector, particularly in transportation, skilled trades and healthcare education, is critical for meeting the demands of a changing labor market. UTI's milestone may enable the company to leverage its equity structure to pursue growth opportunities or improve its financial health. The conversion could be seen as a move to simplify the capital structure, making it more attractive to potential investors.

However, it's essential to consider the potential impact of increased share count on earnings per share (EPS), which could be diluted in the short term. Long-term benefits might include a broader shareholder base and improved liquidity for the stock.

Understanding the nuances of such corporate actions and their implications on the company's operational strategy is pivotal for stakeholders when assessing the company's future performance and market position.

PHOENIX, Dec. 19, 2023 /PRNewswire/ -- Universal Technical Institute, Inc. (NYSE: UTI) (the "Company"), a leading workforce solutions provider of transportation, skilled trades and healthcare education programs, today announced that it achieved the Company conversion option and thus has effected the conversion of all the Company's Series A Preferred Stock into Common Stock, effective December 18, 2023. The Company's outstanding Common Stock increases by 19.3 million shares as a result of the conversion.

Immediately prior to the conversion, the Company purchased 33,300 shares of Series A Preferred Stock convertible into 1,000,000 shares of Common Stock owned by Coliseum Capital Management, LLC ("Coliseum") and certain affiliates. In addition, the Company announced that its board of directors appointed to the board as a Class III director Chris Shackelton, Co-founder and Managing Partner of Coliseum. Mr. Shackelton previously served UTI as a director designated by the holders of the Series A Preferred Stock.

"This represents an important milestone for our Company," said Jerome Grant, Chief Executive Officer, Universal Technical Institute, Inc. "We continue to benefit from the support of our longtime investment partners at Coliseum and Chris Shackelton, whose leadership we appreciate."

Chris Shackelton said, "We are grateful for the tremendous partnership with UTI over the past seven years. The Company's progress has been remarkable, and we congratulate Jerome and the leadership team. Looking ahead, UTI has meaningful untapped potential, and we are excited to continue helping to build shareholder value."

About Universal Technical Institute, Inc.

Universal Technical Institute, Inc. (NYSE: UTI) (the "Company") was founded in 1965 and is a leading workforce solutions provider of transportation, skilled trades and healthcare education programs whose mission is to serve students, partners and communities by providing quality education and support services for in-demand careers across a number of highly skilled fields. The Company is comprised of two divisions: Universal Technical Institute ("UTI") and Concorde Career Colleges ("Concorde"). UTI operates 16 campuses located in 9 states and offers a wide range of transportation and skilled trades technical training programs under brands such as UTI, MIAT College of Technology, Motorcycle Mechanics Institute, Marine Mechanics Institute and NASCAR Technical Institute. Concorde operates across 17 campuses in 8 states, offering programs in the allied health, dental, nursing, patient care and diagnostic fields. For more information, visit www.uti.edu or www.concorde.edu, visit us on LinkedIn at @UniversalTechnicalInstitute and @Concorde Career Colleges or on X (formerly Twitter) @news_UTI or @ConcordeCareer.

Media Contact:
Susan Aspey
Vice President, Corporate Affairs & External Communications
Universal Technical Institute, Inc.
(202) 549-0534
saspey@uti.edu 

Investor Relations Contact:
Matt Glover or Jackie Keshner
Gateway Group, Inc.
(949) 574-3860
UTI@gatewayir.com

View original content:https://www.prnewswire.com/news-releases/universal-technical-institute-inc-announces-conversion-of-all-series-a-preferred-stock-into-common-stock-302018441.html

SOURCE Universal Technical Institute, Inc.

FAQ

What is the recent announcement from Universal Technical Institute, Inc. (NYSE: UTI)?

The company achieved the conversion of all Series A Preferred Stock into Common Stock, increasing outstanding Common Stock by 19.3 million shares and appointed Chris Shackelton, Co-founder and Managing Partner of Coliseum Capital Management, LLC, to the board as a Class III director.

Who is Chris Shackelton and what is his role in Universal Technical Institute, Inc. (NYSE: UTI)?

Chris Shackelton is the Co-founder and Managing Partner of Coliseum Capital Management, LLC. He has been appointed to the board of UTI as a Class III director.

What did the CEO of Universal Technical Institute, Inc. (NYSE: UTI) say about the recent announcement?

Jerome Grant, the CEO, highlighted the achievement as an important milestone for the company and expressed appreciation for the support from investment partners at Coliseum and Chris Shackelton's leadership.

What did Chris Shackelton say about the partnership with Universal Technical Institute, Inc. (NYSE: UTI)?

Chris Shackelton expressed gratitude for the partnership with UTI over the past seven years and emphasized the company's progress and potential for building shareholder value.