WillScot to combine with Mobile Mini in all-share deal

[March 02, 2020]   By Greg Roumeliotis and Rebecca Spalding

NEW YORK (Reuters) - WillScot Corp, the largest U.S. supplier of mobile office trailers, will combine in an all-share deal with Mobile Mini Inc, the biggest U.S. provider of portable storage solutions, the companies said on Monday.

Coming in the middle of a global outbreak of the coronavirus that has sent stock markets reeling, the deal shows how companies can still brave market volatility.

Reuters first reported about the deal on Monday.

The enterprise value of the combined company is about $6.6 billion, the companies said, with WillScot shareholders owning 54% of the new entity. Mobile Mini shareholders will receive 2.4050 shares of WillScot stock for each share they own.

All-share deals can be easier for companies to negotiate in times of market volatility because they depend on the relative valuation of the companies rather than their absolute value, as is the case with cash deals.

Shares of Mobile Mini rose more than 1% in premarket trading.

Shares in companies in the same industry will often move roughly in sync during times of significant market swings, giving them more comfort to proceed with a deal.

WillScot Chief Executive Officer Brad Soultz will be the CEO of the combined company, and Mobile Mini President and CEO Kelly Williams will become president and chief operating officer.

Headquartered in Baltimore, Maryland, WillScot has a fleet of nearly 160,000 modular space and portable storage units. Private equity firm TDR Capital LLP is a major investor in WillScot, which has a market value of about $2 billion.

Mobile Mini, based in Phoenix, Arizona, has a rental fleet of about 198,000 storage containers and office units, as well 12,700 liquid and solid containment units and pumps that it also rents out. Its market capitalization is about $1.7 billion.

The merger would come less than two years after WillScot acquired Modular Space Holdings Inc, another office trailer company, for about $1.2 billion.

Hedge fund Elliott Management Corp last year built a stake in Mobile Mini and pushed for a merger with WillScot, Reuters reported.

The Donerail Group, an investment firm led by William Wyatt, a former executive at activist hedge fund Starboard Value, also built a stake in Mobile Mini last year and pushed it to explore a deal, Reuters reported.

(Reporting by Greg Roumeliotis and Rebecca Spalding in New York and Munsif Vengattil in Bengaluru; Editing by David Goodman and Arun Koyyur)

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