What happened
Shares of SP Plus (SP 0.29%) are up 42% this week as of Thursday's close, according to data provided by S&P Global Market Intelligence, after the mobility solutions company agreed to be acquired by privately held computer-vision company Metropolis.
So what
In a press release Thursday morning, SP Plus announced it has entered into a definitive agreement under which Metropolis will acquire SP Plus for $54 per share in cash, a roughly 52% premium from yesterday's close and a 28% premium from the stock's 52-week high. The deal assigns SP Plus an enterprise value of approximately $1.5 billion.
"While our technology offerings are successfully fulfilling client and market demand, with increased investment, we see the opportunity to accelerate the technology roadmap for the benefit of our clients and their customers," CEO Marc Baumann said. "Combining with Metropolis will advance the pace of technology deployment, which will allow us to do more for existing clients and add new ones as we provide additional high-quality, cutting-edge client and consumer experiences."
Now what
Metropolis has obtained commitments for equity and debt financing totaling $1.7 billion, including $1.05 billion in Series C preferred stock financing and $650 million of debt financing, led by venture capital firms Eldridge and Metropolis investor 3L Capital.
The deal is still subject to regulatory approval and the OK from SP Plus stockholders. But if all goes as planned, it should close sometime in 2024, at which time SP Plus will no longer be publicly traded.
With shares currently trading at a modest 5% discount to the agreed acquisition price -- and assuming that you don't need to wait longer to qualify for lower long-term capital gains taxes on your profits -- I think most SP Plus shareholders would do well to sell now and put their money to work in another promising stock.