Focus Financial announces acquisition proposal from Clayton, Dubilier & Rice

Focus Financial Partners announced that it had entered into an exclusivity agreement for a limited period with Clayton, Dubilier & Rice to engage in negotiations regarding the terms and definitive agreements whereby CD&R may potentially acquire Focus for $53 per share in cash. A Special Committee of the Board of Directors of Focus was formed on November 1, 2022 to evaluate a non-binding offer received from CD&R and to explore alternative transactions. After a series of negotiations with CD&R and outreach and meetings with other potential bidders, the Special Committee has approved the exclusivity agreement based on CD&R meeting the Special Committee’s requirement of $53 per share. CD&R has communicated that its latest non-binding offer of $53 per share represented its "best and final" offer and that it was submitted with the understanding that there would be no further price negotiations. CD&R has also proposed that the transaction would be subject to a non-waivable approval of a majority of the voting power of disinterested shareholders. The contemplated purchase price of $53 per share represents a 36% premium to Focus’ 60-day volume weighted average price as of yesterday’s close and a 48% premium to Focus’ closing stock price on December 28, 2022, the day the Special Committee specifically authorized its financial advisors to broaden their outreach and contact other potential bidders regarding interest in a definitive transaction. Funds managed by Stone Point Capital LLC are considering retaining a portion of their investment in Focus and providing new equity financing as part of the proposed transaction, subject to negotiation with CD&R of definitive agreements on mutually agreeable terms. Negotiations regarding definitive terms and agreements are ongoing and there is no certainty that final terms of any transaction will be agreed upon or, if agreed upon, completed. Any transaction would be subject to the completion of due diligence, Board and stockholder approval, regulatory approvals and other customary conditions. Focus will cease to be a publicly traded company if such a transaction is consummated. The Company and the Special Committee do not currently intend to comment further about this proposal unless and until a specific transaction is recommended by the Special Committee to, and approved by, the Board. The Special Committee has engaged Jefferies LLC and Goldman, Sachs & Co. LLC as its financial advisors.