Metropolis Technologies Inc. announced Thursday it agreed to acquire publicly traded SP Plus Corp., a Chicago-based company that manages parking spaces, for $1.5 billion in enterprise value.
Eric Otness, an M&A partner at Skadden, Arps, Slate, Meagher & Flom in Houston, co-led the team advising the target and Sidley Austin partner Bill Howell co-led the group counseling Metropolis investor Eldridge.
The buyer agreed to pay $54 per share in cash, a premium of around 52 percent over SP+’s closing stock price yesterday and 28 percent over its 52-week high. Metropolis is funded in part by 3L Capital and Eldridge.
Metropolis has received commitments for equity and debt financing totaling $1.7 billion to complete the transaction, consisting of $1.05 billion in Series C preferred stock financing and $650 million in debt financing.
The financing commitments are led by Eldridge and 3L Capital, along with new investors including BDT & MSD Partners’ affiliated credit funds, Vista Credit Partners, and Singapore investment company Temasek. Existing investors Slow Ventures and Assembly Ventures also participated. Metropolis will use the net proceeds to finance the acquisition of SP+ while keeping significant capital on its balance sheet.
The transaction is expected to close in 2024 if the deal clears regulators and SP+ stockholders.
Goldman Sachs & Co. and BDT & MSD Partners were financial advisors to Metropolis. Goldman Sachs was the placement agent on the Series C transaction and Maranon Capital, an Eldridge affiliate, and Goldman Sachs were joint lead arrangers on the debt financing.
Willkie Farr & Gallagher and Fenwick & West are counseling Metropolis. From Willkie, the team included partners Steve Seidman, Laura Delanoy and Morgan McDevitt, who are based in New York.
Morgan Stanley & Co. was financial advisor to SP+. Besides Otness, the rest of the Skadden team counseling SP+ consisted of M&A partners Shilpi Gupta and counsel Jessica Schmiege in Chicago as well as tax partner Victor Hollender (New York), labor and employment partner David Schwartz (New York) and executive compensation and benefits partner Joseph Yaffe (Palo Alto and Los Angeles).
The group also included antitrust/competition partner Clifford Aronson (New York) and counsel Michael Sheerin (New York); real estate partner Nancy Olson (Chicago); banking partner Seth Jacobson and counsel Tabitha Humphries (Chicago); intellectual property and technology counsel Jamie Talbot (New York); and environmental counsel Elizabeth Malone (Washington, D.C.).
Besides Howell, Sidley Austin’s team counseling Eldridge was co-led by Geoffrey W. Levin in New York (M&A and private equity) and Myles C. Pollin, Giselle M. Barth and Ram Burshtine (global finance), also in New York.
The group also included John H. Butler (New York), Hannah L. Marshall (Dallas), Rachel Fridhandler (New York), Adrienn T. Portnoy (Dallas) and Amanda M. Patterson (New York) on M&A and PE matters; Rachel C. Schatz (Houston), Frederick Pai (New York), and Shneur Wolvovsky (New York) on global finance; Laura Collins and Jamie M. Sadler (Washington, D.C.) on antitrust/competition; James Mendenhall (D.C) on FDI; and Christian Brause (New York), Eric M. Grosshandler (New York), and Joel Lifshitz (New York) on tax.
Los Angeles-based Metropolis said it develops and deploys computer vision technology that creates a “drive-in and drive-out” payment for consumers while increasing transparency, capturing revenue and reducing costs for real estate owners. The company was founded in 2017 and is led by Alex Israel, Travis Kell, Peter Fisher and Courtney Fukuda.
SP+ is a technology and operations management provider with more than 20,000 team members who manage about 2 million parking spaces and provide services at over 3,300 commercial locations and 160 airports.
With the acquisition, Metropolis said it will be able to bring new capabilities to North America’s leading network with operations in more than 360 cities, serving millions of consumers and processing over $4 billion in payments per year.
Greenwich, Conn.-based Eldridge invests in businesses in the insurance, asset management, technology, mobility, sports and gaming, media and music, real estate and consumer industries.
Private equity firm 3L backs emerging growth companies in the commerce, enterprise software and tech-enabled services sectors. It is based in Los Angeles and New York City.