KORE Group Holdings to be Acquired by Cerberus Capital Management

TL;DR

KORE is going private, bought by Cerberus for $1.70/share.

AI Summary

KORE Group Holdings, Inc. announced on August 14, 2024, that it has entered into a definitive agreement to be acquired by Cerberus Capital Management, L.P. for $1.70 per share in cash. This transaction is expected to close in the fourth quarter of 2024, subject to customary closing conditions. The acquisition will result in KORE Group Holdings, Inc. becoming a privately held company.

Why It Matters

This acquisition by a private equity firm signifies a shift in ownership for KORE Group Holdings, potentially leading to strategic changes and delisting from public markets.

Risk Assessment

Risk Level: medium — The deal is subject to closing conditions, and there's always a risk of regulatory hurdles or financing issues in private equity acquisitions.

Key Numbers

• $1.70 — Acquisition Price Per Share (The cash amount each shareholder will receive per share.)
• Q4 2024 — Expected Closing Date (The anticipated timeframe for the transaction to be finalized.)

Key Players & Entities

• KORE Group Holdings, Inc. (company) — Company being acquired
• Cerberus Capital Management, L.P. (company) — Acquiring entity
• $1.70 (dollar_amount) — Per share acquisition price
• August 14, 2024 (date) — Date of definitive agreement
• Fourth quarter of 2024 (date) — Expected closing period

FAQ

Key Financial Figures

• $0.0001 — ge on which registered Common stock, $0.0001 par value per share KORE New York Stock
• $5 million — lan are estimated to be in the range of $5 million to $6 million, substantially all of whi
• $6 m — ted to be in the range of $5 million to $6 million, substantially all of which are r
• $600,000 — ton is entitled to an initial salary of $600,000. Mr. Totton's salary will be reviewed a
• $700,000 — , with a potential aggregate payment of $700,000 (the "Totton Cash Award"). $200,000 of
• $200,000 — of $700,000 (the "Totton Cash Award"). $200,000 of the Totton Cash Award (the "Totton T
• $500,000 — in Mr. Totton's employment agreement). $500,000 of the Totton Cash Award shall vest and
• $430,000 — od, Mr. Lubel's base salary will remain $430,000, and he will continue to be eligible to
• $350,000 — ith is entitled to an initial salary of $350,000. Mr. Deith's salary will be reviewed an
• $360,000 — , with a potential aggregate payment of $360,000 (the "Deith Cash Award"). $120,000 of t
• $120,000 — t of $360,000 (the "Deith Cash Award"). $120,000 of the Deith Cash Award (the "Deith Tim
• $240,000 — d in Mr. Deith's employment agreement). $240,000 of the Deith Cash Award shall vest and
• $1.00 — age closing price per share of at least $1.00 over a 30 consecutive trading-day perio

Filing Documents

• kore-20240814.htm (8-K) — 57KB
• ex101ronaldtottonemploymen.htm (EX-10.1) — 157KB
• ex102lubeltransitionagreem.htm (EX-10.2) — 45KB
• ex103deithemploymentagreem.htm (EX-10.3) — 150KB
• ex991kore_q2x24earningsrel.htm (EX-99.1) — 127KB
• image_0.jpg (GRAPHIC) — 22KB
• 0001628280-24-037336.txt ( ) — 797KB
• kore-20240814.xsd (EX-101.SCH) — 2KB
• kore-20240814_lab.xml (EX-101.LAB) — 23KB
• kore-20240814_pre.xml (EX-101.PRE) — 13KB
• kore-20240814_htm.xml (XML) — 3KB

02. Results of Operations and Financial Condition

Item 2.02. Results of Operations and Financial Condition. On August 15, 2024, KORE Group Holdings, Inc. (the "Company") issued a press release announcing its financial results for the second quarter and six months ended June 30, 2024. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K. This information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

05. Costs Associated with Exit or Disposal Activities

Item 2.05. Costs Associated with Exit or Disposal Activities. On August 15, 2024, the Company announced efforts to prioritize its growth initiatives and improve operational efficiency, including a reduction in force plan affecting approximately 19% of the Company's employee base (the "Restructuring Plan"). The Company's Board of Directors (the "Board") approved the Restructuring Plan on July 29, 2024 and affected employees were informed of the plan beginning on August 14, 2024. The Company expects the Restructuring Plan to be substantially completed by December 31, 2024. Total costs and cash expenditures for the Restructuring Plan are estimated to be in the range of $5 million to $6 million, substantially all of which are related to employee severance and benefits costs. The Company expects to incur most of these pre-tax reduction in force charges in the third quarter of 2024. Additionally, a portion of the savings from the reduction in force and other efficiency measures will be reinvested into growth initiatives focused on higher-growth and more profitable areas of our business. Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. Appointment of President and Chief Executive Officer and as a Member of the Board of Directors . On August 15, 2024, the Company announced the appointment of Ronald Totton, effective August 14, 2024, as its President and Chief Executive Officer. Mr. Totton, age 52, had been serving as the Company's interim President and Chief Executive Officer since May 3, 2024. Effective August 14, 2024, Mr. Totton was also appointed as a member of the Board of the Company to serve as a Class III director of the Company until the 2027 Annual Meeting of Stockholders. Prior to joining the Company, Mr. Totton served as an advisor to Indigo Telecom, a provider of engineering services for owners and operators of digital and network infrastruct

01. Other Events

Item 8.01. Other Events. On August 14, 2024, the Company received a letter from the New York Stock Exchange (the "NYSE") stating that the Company has regained compliance with Section 802.01C of the NYSE Listed Company Manual ("Section 802.01C"), which requires listed companies to maintain an average closing price per share of at least $1.00 over a 30 consecutive trading-day period. As previously disclosed, on September 5, 2023, the Company received a letter from the NYSE, indicating that the Company was not then in compliance with Section 802.01C. On July 1, 2024, the Company completed a 1-for-5 reverse stock split, and trading on the NYSE on a split-adjusted basis commenced on July 1, 2024. As of the date of this Current Report on Form 8-K, the Company is in compliance with all NYSE continued listing standards. This Current Report on Form 8-K contains "forward-looking statements" within the meaning established by the Private Securities Litigation Reform Act of 1995, which are identified by words such as "plans," "will," "expects," "may," "believes," "estimates" or "estimated, "intends," and other similar words, expressions, and formulations. This Report contains forward-looking statements regarding the timing and scope of the Restructuring Plan; and the amount and timing of the related charges. Many factors could affect the actual results of the reduction in force plan, and variances from the Company's current expectations regarding such factors could cause actual results of the Restructuring Plan to differ materially from those expressed in these forward-looking statements. The Company presently considers the following to be a non-exclusive list of important factors that could cause actual results to differ materially from its expectations: estimates of employee headcount reductions and cash expenditures that may be made by the Company in connection with the Restructuring Plan. A detailed discussion of these and other risks and uncertainties that could cause

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits. (d) Exhibits Exhibit No. Description 10.1 Executive Employment Agreement, dated August 14, 2024, by and among the Company, KORE Wireless Group, Inc. and Ronald Totton 10.2 Transition Agreement, dated August 14, 2024, by and among the Company, KORE Wireless Group, Inc. and Bryan Lubel 10.3 Executive Employment Agreement, dated August 15, 2024, by and among the Company, KORE Wireless Group, Inc. and Jared Deith 99.1 Press release dated August 14 , 2024 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. KORE Group Holdings, Inc. Date: August 15, 2024 By: /s/ Jack W. Kennedy Jr. Name: Jack W. Kennedy Jr. Title: Executive Vice President, Chief Legal Officer, and Secretary

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View this 8-K filing on SEC EDGAR