Landcadia Holdings II, Inc. Serves Up a New $250M SPAC

Thursday evening, Tillman Fertitta decided he was still hungry and fired up the Waitr app to order a second helping of SPAC pie. Naturally, he asked for only 1/3 the amount of whipped cream. 

Last night, Landcadia Holdings II, Inc. (LHACU) made its debut with a $250 SPAC IPO filing.  Landcadia II will once again be led by Tilman Fertitta, as Co-Chairman and CEO, along with Richard Handler, as Co-Chairman and President, holding the same positions as in Landcadia I.  In fact, the entire team is a near carbon-copy of the first Landcadia deal except for the subtraction of Mark Kelly, who was a Director on Landcadia I.

However, Landcadia II’s terms are slightly different from their first SPAC.  This go-around, Landcadia II will command 1/3 of a warrant rather than the 1/2 we saw in Landcadia I. Additionally, the private placement purchase of warrants (at-risk capital) will be done now at a price of $1.50 as compared to $0.50.  Plus, Jefferies will be participating in the private placement for Landcadia II since they will be a co-sponsor.  However, the amount of Jefferies private placement purchase has been left blank for this initial filing, but the S-1 did state the Jefferies will be receiving 48.3% of the founders shares.  The implication being that the private placement purchase is most likely substantial.

Nonetheless, Landcadia II is coming off a nice win with their first combination with Waitr (WTRH), which is currently trading around $11.00.  Hence, the bump up to 1/3 of warrant from a 1/2.  If a team brings a good deal in their first SPAC, they can command better terms in their subsequent SPAC. The opposite is true too…you’re really only as good as your last SPAC.

Looking beyond the headline terms, what’s notably absent in Landcadia II is the Crescent Term and a forward purchaser or anchor investor.  Do they need those?  They’ll find out on the roadshow, so perhaps those terms will make an appearance in subsequent filings.

Lastly, Jefferies is, once again, lead underwriter.  Currently, there are no other underwriters on the cover, but Duetsche Bank was a co-lead for the first Landcadia, so it will be interesting to see if Jefferies tries to go this one alone.  However, since Jefferies is both a sponsor AND an underwriter in this deal, they will need to line up a Qualified Independent Underwriter (QIU) to remove that conflict of interest.  That field is still blank, but you can bet there will be more than a few banks making that pitch. It’s an easy fee.

Summary of terms below: