STOCK TITAN

TSR, Inc. to be Acquired by Founder of BCforward

Rhea-AI Impact
(Moderate)
Rhea-AI Sentiment
(Neutral)
Rhea-AI Summary

TSR, a recognized IT staffing solutions provider, has entered into a definitive agreement to be acquired by Vienna Parent , an entity formed by BCforward founder Justin Christian.

Under the agreement, Vienna Sub, a wholly-owned subsidiary of Vienna Parent, will purchase all outstanding TSR shares for $13.40 per share, amounting to an equity value of approximately $29 million. This offer represents a 73.8% premium over TSR's closing price on May 14, 2024.

The transaction is expected to close in Q3 2024, subject to customary conditions, including a majority tender of TSR's shares. Vienna Parent has secured up to $24 million in credit from First Merchants Bank to finance the acquisition.

BCforward aims to enhance service offerings through this acquisition, leveraging TSR's established client base.

Positive
  • Shareholders to receive $13.40 per share, a 73.8% premium over May 14, 2024, closing price.
  • Transaction valued at approximately $29 million.
  • Expected closing in Q3 2024, providing a clear timeline.
  • Commitment letter from First Merchants Bank for $24 million in financing.
  • No financing conditions or regulatory approvals required for closing.
  • BCforward's potential to provide enhanced service offerings to TSR’s clients.
  • TSR's long-standing clients to benefit from increased services immediately after the merger.
Negative
  • Transaction subject to customary closing conditions, including majority share tender.
  • Potential risks associated with integration of TSR and BCforward operations.

Insights

The acquisition of TSR, Inc. by Vienna Parent Corporation, formed by Justin Christian, is a significant move in the information technology staffing sector. TSR shareholders are set to receive $13.40 per share, a 73.8% premium over the previous closing price. This considerable premium indicates a strong belief in the synergy between TSR and BCforward. For shareholders, this acquisition represents an immediate return on investment, substantially higher than the market valuation of TSR prior to the announcement.

From a financial perspective, the transaction's equity value is approximately $29 million, which is relatively modest within the industry but substantial for a company like TSR. The transaction is financed by a commitment letter from First Merchants Bank for up to $24 million and Vienna Parent’s cash reserves. The lack of financing conditions or regulatory approvals typically expedites the closing process, reducing the uncertainty for investors.

One potential drawback is the opportunity cost. While the immediate cash payout is attractive, long-term investors may miss potential future growth of TSR under new management. However, given the current premium, the short-term gain appears substantial enough to warrant consideration.

The acquisition of TSR, Inc. by Vienna Parent Corporation, associated with BCforward, suggests a strategic move aimed at expanding service offerings and client base. TSR's established reputation in IT staffing combined with BCforward's extensive reach across multiple sectors such as finance, life sciences and technology, provides opportunities for cross-selling and service enhancement.

For retail investors, this acquisition could indicate an increased market share and a broader client network for the combined entity. The statement regarding the cultural fit and complementary services between BCforward and TSR further supports this potential growth trajectory. Investors should consider the potential for TSR's transformation into a more robust entity with diversified capabilities.

However, integration risks always exist in such mergers. Ensuring a seamless transition and preserving the value of both brands will be essential. If managed well, this acquisition could lead to significant long-term benefits, including enhanced market competitiveness and service innovation.

Legally, the acquisition of TSR, Inc. appears to be on solid ground. The transaction has received approval from both companies' boards and is structured to be straightforward. One noteworthy aspect is that the closing is not subject to any financing conditions or regulatory approvals, which simplifies the process and reduces potential legal hurdles.

The commitment letter from First Merchants Bank and Vienna Parent's cash reserves provide a clear financial pathway for the transaction. Post-tender offer, the second-step merger ensures that all remaining shares will be acquired at the same price, providing consistency and fairness to all shareholders. This structured approach minimizes legal uncertainties and provides clarity on the transaction's execution.

For shareholders, the clear legal and financial framework reduces risk. The involvement of reputable financial and legal advisors also adds a layer of credibility to the transaction, ensuring that it adheres to industry standards and regulatory requirements.

TSR, Inc. Shareholders to Receive Total Cash Consideration of $13.40 per share

INDIANAPOLIS & HAUPPAUGE, N.Y.--(BUSINESS WIRE)-- Vienna Parent Corporation, a newly formed special purpose entity (“Vienna Parent”) formed by Justin Christian, announced today that it has entered into a definitive agreement to acquire TSR, Inc. (“TSR”) (NASDAQ: TSRI). Under the terms of the agreement, Vienna Acquisition Corporation, an affiliate and wholly-owned subsidiary of Vienna Parent (“Vienna Sub”), will commence a tender offer to purchase all of the outstanding shares of TSR for $13.40 per share, representing an equity value of approximately $29 million. The total consideration payable to TSR’s shareholders represents a 73.8% premium to TSR’s closing price on May 14, 2024.

TSR was founded in 1969 and is a well-recognized national provider of information technology staffing solutions. Mr. Christian is the CEO and founder of Bucher and Christian Consulting, Inc., d/b/a BCforward (“BCforward”), one of the largest black-owned professional services and workforce management solutions firms in the United States. Currently, BCforward employs more than 5,000 people globally and serves multi-national clients in the finance, life science, technology, healthcare and government sectors. Vienna Parent and Vienna Sub are affiliates of, and under common control with, BCforward.

“Working with the TSR team is a truly exciting step in the continued growth and expansion of BCforward,” said Justin Christian. “We look forward to partnering with the entire team at TSR to continue this journey together by offering our collective clients new and enhanced capabilities.”

“BCforward is a fantastic cultural fit with the business we have built over the past 54 years,” said Bradley Tirpak, Chairman of the Board of TSR. “BCforward’s ability to provide additional service offerings to our long- standing clients will help expand the overall business for years to come.”

“In the past four years, we have worked tirelessly at transforming TSR into a tech savvy, employee first, best in class staffing firm,” said Thomas Salerno, President and CEO of TSR. “I am extremely excited to join forces with the talented BCforward team and am confident that we have a long runway of growth ahead of us. Justin Christian and his team have cemented BCforward at the top of the industry and TSR’s long-standing clients will receive the benefit of an immediate increase in services and offerings once our teams are operating under a common umbrella.”

Terms of the Agreement

Under the terms of the merger agreement, Vienna Sub will commence a tender offer to acquire all outstanding shares of TSR’s common stock for a purchase price of $13.40 per share in cash. The transaction has been approved by the boards of directors of both companies.

The transaction is expected to close in the third quarter of 2024, subject to customary closing conditions, including the tender of a majority of the outstanding shares of TSR’s common stock. Vienna Parent has obtained a commitment letter from First Merchants Bank for up to $24,000,000 of credit, which together with Vienna Parent’s cash on hand will be used to finance the transaction. The closing of the transaction is not subject to any financing conditions or regulatory approvals. Following the successful closing of the tender offer, Vienna Sub will acquire any remaining shares of TSR that are not tendered in the tender offer through a second-step merger at the same consideration per share paid in the tender offer.

For TSR, FOCUS Investment Banking is acting as the exclusive financial advisor and Shulman Rogers is acting as legal counsel. In connection with the transaction, Chessiecap Securities, Inc. provided a fairness opinion to the Board of Directors of TSR. Ice Miller LLP is acting as legal counsel to Vienna Parent and Vienna Sub.

About TSR, Inc.

Founded in 1969, TSR, Inc. is a leading staffing company focused on recruiting information technology professionals for short- and long-term assignments, permanent placements, and project work. For over 50 years, TSR has successfully served clients in banking, asset management, pharmaceuticals, insurance, health care, public utility, publishing, and other industries. TSR provides candidate screening, timely placement, and a real understanding of the right skill sets required by our clients. To learn more, please visit TSR’s website at www.tsrconsulting.com.

About Vienna Parent Corporation

Vienna Parent Corporation is a special purpose entity formed by Justin Christian for the purpose of acquiring TSR, Inc. Justin Christian founded BCforward, a global IT consulting and workforce fulfilment firm, more than 25 years ago and has grown it from a team of two to one of the largest Black-owned businesses in the United States. BCforward proudly offers Professional Services and Workforce Management solutions and serves multi-national clients in the finance, life science, technology, healthcare, and government sectors. From the start, Justin and BCforward have championed the power of human potential to help companies transform, accelerate, and scale. For more information, please visit https://www.BCforward.com/.

Additional Information and Where to Find It; Participants in the Solicitation

The tender offer described in this communication has not yet commenced. This communication is for informational purposes only and is neither an offer to purchase nor a solicitation of an offer to sell any securities, nor is it a substitute for the tender offer materials that Vienna Parent Corporation and Vienna Acquisition Corporation (collectively, the “Vienna Filings Persons”) will file with the United States Securities and Exchange Commission (the “SEC”) upon commencement of the tender offer. A solicitation and offer to buy outstanding shares of TSR, Inc. (the “Company”) will only be made pursuant to the tender offer materials that the Vienna Filing Persons intend to file with the SEC. BCforward itself is not a party to the Merger Agreement, nor is it involved in any part of the tender offer. At the time the tender offer is commenced, the Vienna Filing Persons will file tender offer materials on Schedule TO, and TSR will file a Solicitation/Recommendation Statement on Schedule 14D-9 with the SEC with respect to the tender offer. THE OFFER MATERIALS (INCLUDING AN OFFER TO PURCHASE, A RELATED LETTER OF TRANSMITTAL AND CERTAIN OTHER TENDER OFFER DOCUMENTS) AND THE SOLICITATION/RECOMMENDATION STATEMENT WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND THE PARTIES THERETO. INVESTORS AND STOCKHOLDERS OF TSR ARE URGED TO READ THESE DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE (AND EACH AS IT MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME) BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION THAT INVESTORS AND STOCKHOLDERS OF TSR SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING TENDERING THEIR SHARES OF COMMON STOCK IN THE TENDER OFFER. The tender offer materials (including the Offer to Purchase and the related Letter of Transmittal), as well as the Solicitation/Recommendation Statement, will be made available to all stockholders of TSR at no expense to them on the SEC’s website at www.sec.gov and (once they become available) will be mailed to the stockholders of TSR free of charge. Free copies of these materials and certain other offering documents will be made available by TSR by mail to TSR, Inc., 400 Oser Avenue, Suite 150, Hauppauge, NY 11788, Attention: Investor Relations, by email at info@tsrconsulting.com, or by directing requests for such materials to the information agent for the tender offer, which will be named in the tender offer materials. In addition to the Offer to Purchase, the related Letter of Transmittal and certain other tender offer documents, as well as the Solicitation/Recommendation Statement, TSR files annual, quarterly, and current reports, proxy statements and other information with the SEC. You may read any reports, statements or other information filed by the Vienna Filing Persons and TSR with the SEC for free on the SEC’s website at www.sec.gov.

Forward-Looking Statements

This communication contains forward-looking statements related to TSR, the Vienna Filing Persons, BCforward, and the proposed transaction that involve substantial risks and uncertainties. Forward-looking statements include any statements containing the words “anticipate,” “believe,” “estimate,” “expect,” “intend”, “goal,” “may”, “might,” “plan,” “predict,” “project,” “seek,” “target,” “potential,” “will,” “would,” “could,” “should,” “continue” and similar expressions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. In this communication, TSR’s forward-looking statements include statements about the parties’ ability to satisfy the conditions to the consummation of the tender offer and the other conditions to the consummation of the proposed transaction; statements about the expected timetable for completing the proposed transaction; TSR’s plans, objectives, expectations and intentions; the financial condition, results of operations and business of TSR and the Vienna Filing Persons and BCforward; and the anticipated timing of the closing of the proposed transaction.

Forward-looking statements are subject to certain risks, uncertainties or other factors that are difficult to predict and could cause actual events or results to differ materially from those indicated in any such statements due to a number of risks and uncertainties. Those risks and uncertainties that could cause the actual results to differ from expectations contemplated by forward-looking statements include, among other things: uncertainties as to the timing of the tender offer and the merger; uncertainties as to how many of TSR’s stockholders will tender their shares in the tender offer; the possibility that the Vienna Filing Persons will not be able to obtain the financing necessary to fund the transaction; the possibility that competing offers will be made; the possibility that various closing conditions for the proposed transaction may not be satisfied or waived; the effects of the proposed transaction on relationships with employees, other business partners or governmental entities; the impact of competitive services and pricing; other business effects, including the effects of industry, economic or political conditions outside of the companies’ control; transaction costs; actual or contingent liabilities; and other risks listed under the heading “Risk Factors” in TSR’s periodic reports filed with the U.S. Securities and Exchange Commission, including current reports on Form 8-K, quarterly reports on Form 10-Q, annual reports on Form 10-K, as well as the Schedule 14D-9 to be filed by TSR and the Schedule TO and related tender offer documents to be filed by the Vienna Filing Persons. You should not place undue reliance on these statements. All forward-looking statements are based on information currently available to TSR and the Vienna Filing Persons, and TSR and the Vienna Filing Persons disclaim any obligation to update the information contained in this communication as new information becomes available.

Thomas Salerno

631-231-0333

Source: TSR, Inc.

FAQ

What are TSR shareholders receiving in the acquisition?

TSR shareholders will receive $13.40 per share in cash.

How much is the acquisition of TSR valued at?

The acquisition is valued at approximately $29 million.

What premium does the offer represent over TSR's closing price?

The offer represents a 73.8% premium over TSR's closing price on May 14, 2024.

When is the TSR acquisition expected to close?

The acquisition is expected to close in the third quarter of 2024.

Is the TSR acquisition subject to financing conditions or regulatory approvals?

No, the closing of the transaction is not subject to any financing conditions or regulatory approvals.

Who is the founder of BCforward involved in acquiring TSR?

Justin Christian, the founder of BCforward, is involved in the acquisition.

TSR Inc. New

NASDAQ:TSRI

TSRI Rankings

TSRI Latest News

TSRI Stock Data

28.99M
2.17M
59.99%
12.55%
0.1%
Software - Application
Services-computer Programming Services
Link
United States of America
HAUPPAUGE