Vertiv Holdings to Restate 2020 Results Due to SEC Guidance for SPAC Warrant Accounting
By Josh Beckerman
Vertiv Holdings Co. will restate its 2020 results due to
Securities and Exchange Commission guidance for warrant accounting
for special-purpose acquisition companies.
In February 2020, the digital infrastructure company merged with
a SPAC backed by Goldman Sachs Group Inc.
On April 12, the SEC said that under certain circumstances,
warrants should be classified as liabilities, rather than as
Several companies have delayed their 2020 annual reports as they
review SEC guidance, including Tekkorp Digital Acquisition Corp.,
Mallard Acquisition Corp., Blue Water Acquisition Corp., Better
World Acquisition Corp. and Edoc Acquisition Corp.
Discussing public and private placement warrants that were
outstanding at the time of the merger, Vertiv said that "consistent
with market practice among SPACs, we had been accounting for the
warrants as equity under a fixed accounting model." Given the SEC's
April 12 statement, it will restate financial statements "such that
the warrants are accounted for as liabilities and marked-to-market
each reporting period."
As a result of the restatement and the increase in its stock
price over the applicable period, Vertiv expects to recognize
incremental 2020 non-operating expense between $140 million to $160
million. There will be no impact to previously reported net cash
Write to Josh Beckerman at email@example.com
(END) Dow Jones Newswires
April 22, 2021 19:50 ET (23:50 GMT)
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