DSG will also pay $37.5 million in cash or stock as retention bonuses to certain employees who will remain with Hisco or its subsidiaries for twelve months or more after the agreement closes.
As part of the proposed rights offering to fund the transaction, the company plans to distribute, at no cost to registered shareholders, stock rights to raise approximately $100 million.
The record date, subscription price, expiration date and other details of the rights offering will be specified in a prospectus supplement that DSG intends to file with the SEC once further details will be available.
Luther King Capital Management and its affiliates, which currently own approximately 77% of the outstanding shares of DSG, have indicated their intention to subscribe in full for their pro rata share of the rights offering.
The company expects that after taking this combination into account, its net debt leverage to Adjusted EBITDA will be between 3.25x and 3.50x at closing.
DSG action +2.6% at $42.32.