TGI Fridays will no longer become a public company as Allegro Merger ends acquisition

Allegro Merger, a blank check company formed by Crescendo Partners' Eric Rosenfeld, announced that it and TGI Fridays have terminated their merger agreement.

In a newly-filed 8-K, the company cited extraordinary market conditions and the failure to meet necessary closing conditions. In November 2019, the SPAC disclosed its plan to acquire TriArtisan Capital-backed TGI Fridays at an enterprise value of $448 million (8.0x LTM adj. EBITDA). TGI Fridays is a highly-recognized American brand, but in recent years consumer tastes have shifted away from casual dining chains; with a public listing and cash from the merger, TGI Fridays stood to shore up its balance sheet and fund marketing initiatives. In the past month, however, the US restaurant industry has been roiled by forced closures and plummeting sales amid the COVID-19 outbreak.

According to the 8-K, the company's corporate existence will cease except for the purposes of winding up its affairs and liquidating. As soon as practicable, it will liquidate and distribute to the holders of shares of common stock issued in its initial public offering their pro-rata portion of the funds held in the trust account established for the benefit of such stockholders. The SPAC's warrants and rights will expire with no value.

The New York, NY-based SPAC was founded in 2017 and raised $130 million in July 2018, listing on the Nasdaq (ALGR). 

Since the start of 2018, 118 SPACs have priced IPOs, including 83 that are seeking acquisitions, 15 that have announced acquisitions, 19 that have completed acquisitions, and 1 that plans to liquidate. 12 SPACs are in the IPO pipeline.