Pinstripes Inc., the large-venue dining and entertainment brand, plans to become a public company in a special purpose acquisition company deal with Banyan Acquisition Corp., a blank-check firm, the companies said Friday.
Northbrook, Ill.-based Pinstripes, which has 13 units open in eight states and Washington, D.C., said it expects the SPAC deal to be completed by the end of 2023.
The transaction values the combined company at about $520 million at $10 per share and includes an upfront equity investment of more than $20 million directly in Pinstripes by Middleton Partners, a Chicago-based investment firm, the companies said. Besides the condition of the Middleton investment, the closing of the deal depends on at least $75 million in gross cash proceeds to the combined company.
Upon closing of the transaction, existing Pinstripes shareholders will receive shares of the surviving public combined company.
Pinstripes, in a press release, said existing locations “generate average unit volumes of more than $8 million” and venue-level earnings before interest, taxes, depreciation and amortization of more than 17%.
Pinstripes menus feature lunch, dinner and weekend brunch with beer and wine dinner pairings featuring Italian/American wineries and local craft breweries. Venues range from 25,000 square feet to 38,000 square feet. The entertainment offerings range from bowling to bocce. Locations provide private-events spaces for gatherings of 20 to 1,500 people. In addition, Pinstripes provides off-site catering (typically breakfast and lunch) for local businesses and off-site weddings and other celebrations.
The company has six venues under construction and opportunities for about 150 locations in the United States, exclusive of international potential. The merger with Banyan Acquisition Corp. would support further expansion of the Pinstripes brand.
Calendar-year 2024 revenue is expected between $185 million and $195 million, the company said.
Pinstripes is led by founder and CEO Dale Schwartz, who will continue to lead the company with his seasoned leadership team. Banyan is led by Jerry Hyman, chairman, and Keith Jaffee, CEO, both foodservice industry veterans. (Pictured from left: Jaffe of Banyan, Schwartz of Pinstripes and Hyman of Banyan.)
Schwartz said in a statement: “We founded Pinstripes in 2007 to create the fun interactions and celebrations that people crave, by uniquely combining made-from-scratch dining with the timeless games of bowling and bocce. Our iconic community-gathering venues feed the souls of guests of all ages.”
Schwartz added that brand as well-positioned “to capitalize on the exciting experiential trends.”
He said the Banyan Acquisition deal would give the company “additional capital from the public markets and further scale our winning combination of dining and entertainment.”
Keith Jaffee, CEO of Banyan Acquisition Corp, said: “Pinstripes has distinctly separated itself from its peers, as its phenomenal cuisine results in a 75/25 revenue split between food and games.”
The boards of Pinstripes and Banyan have each approved the transaction.
William Blair & Co. LLC is serving as financial and capital markets adviser to Banyan. BTIG LLC is serving as capital markets adviser to Banyan. DLA Piper LLP (US) is serving as legal counsel to William Blair & Co. L.L.C. and BTIG, LLC. Harrington Park Advisors is acting as financial adviser to Middleton Partners. Katten Muchin Rosenman LLP is acting as legal adviser to Pinstripes, and Kirkland & Ellis is acting as legal adviser to Banyan. Piper Sandler is serving as financial adviser to Pinstripes on the equity investment funded by Middleton Partners.
Upon the closing of the transaction, Pinstripes’ common stock and warrants are expected to be listed on the New York Stock Exchange under the ticker symbols “PNST” and “PNST WS,” respectively.
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