Pensare Aquisition Corp. (WRLS) announced this morning that they intend to adjourn today’s extension vote. Instead, the vote will be held tomorrow, July 31st, at which, shareholders will be asked to approve a four-month extension of their deadline to December 1, 2019.
As a reminder, Pensare does not intend to make any additional contributions to trust after August 1st. However, we do know that Pensare, which currently has an estimated $63 million in trust, intends to acquire Computex for an aggregate of approximately $65 million in cash, stock, and assumed debt. So by not offering a contribution, it would appear Pensare is trying to reduce the trust amount via redemptions and possibly replace some of that loss (if it is significant) with a new PIPE.
If you recall, in Pensare’s previous proxy filing regarding the extension vote, they stated:
“The withdrawal of funds from the trust account in connection with the Election will reduce the amount held in the trust account following the redemption, and the amount remaining in the trust account may be significantly reduced from the approximately $63 million that was in the trust account as of June 19, 2019. In such event, Pensare may need to obtain additional funds to complete a business combination and there can be no assurance that such funds will be available on terms acceptable to the parties or at all.”
However, why is Pensare delaying the vote just one day? Seems to be cutting it pretty close to their deadline of August 1, 2019. Maybe there is some administrative issue or maybe they just want to delay having to release the results of that vote to next week (per the rules, vote results aren’t due for 4 business days, although most companies release their results much earlier than that).
Regardless, per Pensare’s statement above, there is the added risk of a new PIPE (post-vote) done a price below $10.00. Layer in a four-month extension without any contribution to trust for remaining shareholders and that means redemptions are going to be HEAVY.
Stay tuned for any further updates.