Target Hospitality Corp. has provided a business update, announcing the disbandment of the special committee of the company's board of directors that was established to consider and evaluate the previously announced unsolicited non-binding offer. The offer, received on March 24, 2024, was from Arrow Holdings S.à r.l. to acquire all outstanding shares of common stock of the company not owned by Arrow, any investment fund managed by TDR, or their respective affiliates for cash consideration of $10.80 per share.
The company's focus will now shift toward allocating capital to high-return initiatives, including inorganic growth, and it has reaffirmed its 2024 outlook based on the strength of year-to-date operating results.
According to the announcement, the conclusion of the evaluation process of the previous offer restores the company's full flexibility to pursue multiple capital allocation opportunities focused on maximizing value. The company plans to reinvigorate its efforts to maximize value creation while maintaining its strong financial position through disciplined capital deployment.
Brad Archer, President, and Chief Executive Officer of Target Hospitality, commented, “Our underlying business fundamentals remain strong, and the company continues to perform well, capitalizing on healthy demand for our services and our efficient operating platform."
Target Hospitality is one of North America's largest providers of vertically integrated modular accommodations and value-added hospitality services. The company builds, owns, and operates a customized network of communities for a range of end users through a full suite of value-added solutions, including premium food service management, concierge, laundry, logistics, security, and recreational facilities services. As a result of these announcements, the company's shares have moved -18.7% on the market, and are now trading at a price of $7.67. For the full picture, make sure to review Target Hospitality's 8-K report.
