The Donerail Group Issues Statement Supporting Mobile Mini and WillScot Merger

LOS ANGELES, March 3, 2020 /PRNewswire/ -- The Donerail Group LP and its affiliates ("We") are pleased by yesterday's announcement that Mobile Mini, Inc. ("Mobile Mini") (NasdaqGS: MINI) will be acquired by WillScot Corporation ("WillScot") (NASDAQ: WSC), at a price of $42.18 per share in an all-stock merger (based on WillScot's closing stock price of $17.54 on February 28, 2020), and we intend to vote all of our Mobile Mini shares in favor of the merger.  We believe the combined company will create a dominant industry leader in specialty leasing with a combined enterprise value of nearly $7 billion, and assuming only the stated cost synergies, the combined company could generate over $800 million EBITDA and $500 million of run-rate free cash flow in CY2021.  

In our view, the core industrial logic of the merger is undeniable: the combined company will have industry leading scale and a complementary offering of both temporary storage and office products, creating a strong platform for future growth.  Over 90% of combined company revenue comes from leases with durations averaging approximately 2.5 years, providing substantial revenue visibility.  Further, we expect that the combined pro forma 2019 EBITDA margins of nearly 40%, including stated cost synergies, will further increase over the near- to medium-term as Value Added Products from the WillScot portfolio are brought to the 210,000 units within the Mobile Mini portfolio.  

We believe the resiliency of the combined business is attractive.  The combined entity's ability to rapidly reduce or eliminate net capital expenditures in the event of an economic slowdown is unique and provides free cash flow protection that is atypical.  Moreover, with just 3.5x of net leverage expected at CYE2020 and the ability to de-lever at approximately 1.0x per year, we believe the financial stability of the combined company is drastically underappreciated.

We have been large shareholders of both Mobile Mini and WillScot over the past year, and we believe that the operational enhancements made by each management team in recent years have afforded this to be one of the most compelling mergers that we have seen in some time.  We applaud the management teams of both Mobile Mini and WillScot for recognizing the unique value-creation opportunity that exists by bringing these companies together in a responsible, shareholder friendly manner, and we believe that there will be significant equity value creation for shareholders through the combination.

About The Donerail Group LP
The Donerail Group LP is a Los Angeles-based investment adviser with a fundamental approach to investing, focusing primarily on publicly traded companies within the United States. Donerail seeks investments where value can be unlocked through strategic measures and often engages with management teams and boards of directors to realize such value.

Donerail Contact:
John Weaver – (310) 564-9993

SOURCE The Donerail Group LP