NEW YORK, Jan. 25, 2021 /PRNewswire/ -- Latch, Inc.
("Latch" or the "Company"), maker of the
full-building enterprise software-as-a-service (SaaS) platform
LatchOS, and TS Innovation Acquisitions Corp. (NASDAQ: TSIAU)
("TSIA"), a publicly traded special purpose
acquisition company launched by leading real estate owner,
developer, operator and investment manager Tishman Speyer
Properties, L.P. ("Tishman Speyer"),
today announced that they have entered into a definitive merger
agreement that will result in Latch becoming a publicly listed
company. The transaction values the Company at an equity value of
$1.56 billion post-money. Upon
closing, Latch's common stock is expected to trade on
NASDAQ under the ticker symbol "LTCH".
Founded in 2014, Latch is an enterprise SaaS provider to
buildings and residents that makes spaces better places to live,
work and visit. From the beginning, Latch has worked hand-in-hand
with many of the country's largest real estate owners as partners
and investors including Tishman
Speyer, Brookfield, and
more. The Company has booked over 300,000 units across more
than 35 states, with one in ten new multifamily apartments in
the United States built with Latch
in 2019.
The Company's proven management team, led by
co-founder and CEO Luke
Schoenfelder, will continue to operate and manage Latch
following the transaction. Rob
Speyer, President and CEO of Tishman
Speyer and CEO and Chairman of TSIA, will join the
Company's Board of Directors upon completion of the
transaction.
"Latch has successfully created an entire ecosystem
around our full building operating system, devices, and partners
that enhances the building experience for both owners and
residents," said Schoenfelder. "This transaction
provides the capital for Latch to accelerate our product and market
expansion and drive bookings growth. Furthermore, Latch will be
able to harness Tishman
Speyer's global real estate platform to more
rapidly create new products, leveraging their vertically integrated
real estate business and on-the-ground teams across the globe. We
are fortunate to benefit from Rob's vision and
leadership and look forward to partnering with the entire
Tishman Speyer team as we create
value for our shareholders, customers, and residents by scaling our
business in this next phase while we continue to enhance the way
people interact with their spaces."
"As a long-time real estate and capital markets investor,
Tishman Speyer has helped accelerate
many of the prop tech innovations reshaping our cities," said
Speyer. "We launched our SPAC knowing that our expertise and
portfolio could power the next generation of innovators on the
public stage. Our mission has been to partner with a growing
company; one with a great team, a strong and differentiated
business model and the ability to scale quickly through our
platform. As both a customer and early investor in Latch, I know
Luke and his talented team check all of these boxes. We look
forward to serving as an incubator, operational partner and launch
customer as Latch develops and expands its exceptional product
lines."
Technology Partner and Operating System for Modern
Buildings
LatchOS is the first multifamily operating system that brings
together all the elements that make up the modern building for
building managers, residents, and service providers. Its core
capabilities are designed to unify operations for everyone, and
building owners have the flexibility to select the specific
capabilities they need to meet their needs.
LatchOS provides:
- Smart Access – The Latch smart access platform includes the
Latch M, C, and R Series of digital entry devices that work for
each space in a multi-family building, supporting residents, staff,
and guests at building entrances, common areas, garages, elevators,
and individual apartments.
- Delivery and Guest Management – Latch's guest management
capabilities enable unattended deliveries, package management, and
guest reception through the Latch Intercom and Latch Delivery
Assistant.
- Smart Home and Sensors – The enterprise device management
capabilities of LatchOS integrate smart home and sensor control
that work with Latch partners, such as Google Nest, ecobee,
Honeywell, and Jasco, enabling management and control over
thermostats, lighting and leak detectors, and more.
- Connectivity – Latch enables cellular connectivity through the
Latch Intercom and Latch Hub, which bring internet access to new
and existing building infrastructure, connecting devices for both
new and retrofit customers in more flexible ways.
- Resident Experience – Latch's mobile interface provides a
seamless resident experience and community management capabilities,
including resident onboarding, with the average Latch app user
interacting with the app 4.6x per day.
With LatchOS, the Company is defining the building operating
system category with a unique platform and a highly attractive
financial operating profile:
- Deep relationships with many of the country's
largest residential real estate owners including seven of the ten
largest NMHC developers, alongside other large NMHC developers like
Alliance, Avalon Bay, Greystar, and
NRP Group, plus AMLI Residential, Prometheus, RXR Realty, Toll
Brothers, and beyond;
- A rapidly growing recurring enterprise software revenue
model;
- Highly sticky customer relationships with building owners and
residents;
- Long-term, pre-paid enterprise software agreements with high
switching cost;
- Capital efficient customer acquisition and clear upsell
opportunities; and
- Visibility to sustained Average Revenue per Home Unit (ARPHU)
expansion with new and existing customers.
Latch is well-positioned to drive growth through:
- Extensive opportunities to sell deeper into new and existing
customer portfolios;
- Further expansion into an enormous and underpenetrated
$54 billion TAM through both new
project construction and retrofit opportunities;
- Further expansion of ARPHU by delighting customers with new
offerings like Intercom, Smart Home, and more, all accessible
through the trusted LatchOS interface; and
- The opportunity for further disruptive consumer SaaS/internet
businesses on top of the LatchOS enterprise channel.
The Company has generated strong results to date, including
$167 million in Booked
Revenue1 in 2020, which represents 49 percent growth
from 2019; zero customer churn leading to 100 percent Gross Revenue
Retention2; and a strong SaaS company Lifetime
Value (LTV) to Customer Acquisition Costs (CAC) ratio of
6.8x3.
Partnership to Drive Growth and Accelerate
Latch's Expansion
The market for an apartment building operating system is
massive, with an estimated 47 million rental homes in the United States representing an
approximately $54 billion total
annual market. Latch currently services less than one percent of
this market and is well-positioned to drive continued growth.
Partnering with TSIA will bring together Latch's
leading software and products with the global real estate platform
of Tishman Speyer, the parent of
TSIA's sponsor. With an international portfolio
encompassing nearly 80 million square feet of first-class real
estate across many asset classes, including residential, commercial
office, mixed use and life sciences, among others, Tishman Speyer will deliver synergies to Latch
to further its growth and product expansion.
Transaction Overview
Upon completion of the transaction, Latch expects to have up to
$510 million in cash, net of fees and
expenses to fund growth initiatives, including growing the number
of units on its platform, expanding to additional asset classes and
spreading to new geographies.
This includes net proceeds from TSIA's cash held in
trust of $300 million from its
initial public offering in November
2020 and approximately $60
million of cash on Latch's balance sheet. The transaction is
further supported by a $190 million
PIPE at $10.00 per share from key
investors, including funds and accounts managed by BlackRock, D1
Capital Partners, Durable Capital Partners LP, Fidelity Management
& Research Company LLC, Chamath Palihapitiya, The Spruce House
Partnership, Wellington Management, ArrowMark Partners, Avenir and
Lux Capital. Latch's existing equity holders have
agreed to convert 100 percent of their ownership stakes into the
new company, and are expected to own 64 percent of the pro forma
company at close.
The transaction, which has been unanimously approved by
TSIA's board of directors, is expected to close in the
second quarter of 2021, and is subject to approval by
TSIA's shareholders and other customary closing
conditions, including any applicable regulatory approvals.
Additional information about the proposed transaction, including
a copy of the merger agreement and investor presentation, will be
provided in a Current Report on Form 8-K to be filed by TSIA today
with the Securities and Exchange Commission ("SEC")
and available at www.sec.gov.
Advisors
Goldman Sachs is acting as exclusive financial advisor to Latch
and acted as joint placement agent on the PIPE. Latham &
Watkins LLP is acting as legal advisor to Latch. Allen &
Company LLC and BofA Securities are acting as joint financial
advisors to TSIA and also acted as joint lead placement agents on
the PIPE. Sullivan & Cromwell is acting as legal advisor to
TSIA.
Conference Call Information
Latch and TSIA will host a joint investor conference call to
discuss the transaction and review the investor presentation today,
Monday, January 25, 2021, at
8:00 AM Eastern Time. The conference
call can be accessed by dialing (833) 900-2259 within the U.S. and
(236) 714-2865 for all other locations, and entering the passcode
3547158.
A webcast of the conference call and associated presentation
materials will be accessible on Latch's investor relations page at
www.latch.com/investors. A replay will be available after
completion of the conference call and can be accessed on the
investor relations pages.
About Latch, Inc.
Latch is reimagining the modern buildings of today and driving
evolution for the cities of tomorrow. Latch delivers a
building-wide system designed to help owners, residents and third
parties (e.g. guests, couriers, service providers) seamlessly
experience the modern building through integrated products,
software and services. More than one in ten new apartments in the
U.S. were being built with Latch products in 2019, with multifamily
buildings in more than 35 states featuring Latch solutions and
supporting more than two million unlocks per month.
www.latch.com
About TS Innovation Acquisitions Corp.
TS Innovation Acquisitions Corp., a Delaware corporation, is a blank check company
whose business purpose is to effect a merger, capital stock
exchange, asset acquisition, stock purchase, reorganization or
similar business combination with one or more businesses. Tishman
Speyer Properties, L.P. ("Tishman
Speyer"), a leading owner, developer, operator and
investment manager of first-class real estate in 28 key markets
across the United States,
Europe, Asia and Latin
America, has sponsored TS Innovation Acquisitions Corp.
through its affiliate TS Innovation Acquisitions Sponsor,
L.L.C.
About Tishman Speyer
Tishman Speyer is a leading
owner, developer, operator and investment manager of first-class
real estate in 28 key markets across the
United States, Europe,
Asia and Latin America. We develop, build and manage
premier office, residential and retail spaces for industry-leading
tenants, as well as state-of-the-art life science centers through
our Breakthrough Properties venture. With global vision,
on-the-ground expertise and a personalized approach, we are
unparalleled in our ability to foster innovation, quickly adapt to
global and local trends and proactively anticipate our
customers' evolving needs. By focusing on health
and wellness, enlightened placemaking and customer-focused
initiatives such as our tenant amenities platform, ZO., and our
flexible space and co-working brand, Studio, we tend not just to
our physical buildings, but to the people who inhabit them on a
daily basis. Since our inception in 1978, Tishman Speyer has acquired, developed, and
operated 453 properties, totaling 210 million square feet, with a
combined value of approximately $113
billion (U.S.). Our current portfolio includes such iconic
assets as Rockefeller Center in New York
City, The Springs in
Shanghai, TaunusTurm in
Frankfurt and the Mission Rock
neighborhood currently being realized in San Francisco.
[1] Booked Revenue represents signed deals set to deliver within
a 24-month period.
[2] Gross Revenue Retention is defined as the percentage of
delivered ARR retained from existing customers.
[3] Lifetime Value (LTV) is defined as Software revenue minus
Software cost of goods sold without factoring in ongoing
renewals.
IMPORTANT ADDITIONAL INFORMATION AND WHERE TO FIND IT
This release relates to a proposed transaction between Latch and
TSIA. This release does not constitute an offer to sell or
exchange, or the solicitation of an offer to buy or exchange, any
securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, sale or exchange would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. TSIA intends to file a
registration statement on Form S-4 that will include a proxy
statement of TSIA and a prospectus of TSIA. The proxy
statement/prospectus will be sent to all TSIA and Latch
stockholders. TSIA also will file other documents regarding the
proposed transaction with the SEC. Before making any voting
decision, investors and security holders of TSIA and Latch are
urged to read the registration statement, the proxy
statement/prospectus and all other relevant documents filed or that
will be filed with the SEC in connection with the proposed
transaction as they become available because they will contain
important information about the proposed transaction.
Investors and security holders will be able to obtain free
copies of the proxy statement/prospectus and all other relevant
documents filed or that will be filed with the SEC by TSIA through
the website maintained by the SEC at www.sec.gov. In addition, the
documents filed by TSIA may be obtained free of charge from TSIA's
website at www.TSIAcorp.com or by written request to TSIA at TS
Innovation Acquisitions Corp., 45 Rockefeller Plaza, 7th Floor,
New York, NY 10111.
PARTICIPANTS IN SOLICITATION
TSIA and Latch and their respective directors and officers may
be deemed to be participants in the solicitation of proxies from
TSIA's stockholders in connection with the proposed transaction.
Information about TSIA's directors and executive officers and their
ownership of TSIA's securities is set forth in TSIA's filings with
the SEC, including TSIA's Registration Statement on Form S-1, which
was filed with the SEC on November 5,
2020. To the extent that holdings of TSIA's securities have
changed since the amounts printed in TSIA's Registration Statement
on Form S-1, such changes have been or will be reflected on
Statements of Change in Ownership on Form 4 filed with the SEC.
Additional information regarding the interests of those persons and
other persons who may be deemed participants in the proposed
transaction may be obtained by reading the proxy
statement/prospectus regarding the proposed transaction when it
becomes available. You may obtain free copies of these documents as
described in the preceding paragraph.
FORWARD-LOOKING STATEMENTS
This release contains certain forward-looking statements within
the meaning of the federal securities laws with respect to the
proposed transaction between Latch and TSIA, including statements
regarding the benefits of the transaction, the anticipated timing
of the transaction, the services offered by Latch and the markets
in which it operates, and Latch's projected future results. These
forward-looking statements generally are identified by the words
"believe," "project," "expect," "anticipate," "estimate," "intend,"
"strategy," "future," "opportunity," "plan," "may," "should,"
"will," "would," "will be," "will continue," "will likely result,"
and similar expressions. Forward-looking statements are
predictions, projections and other statements about future events
that are based on current expectations and assumptions and, as a
result, are subject to risks and uncertainties. Many factors could
cause actual future events to differ materially from the
forward-looking statements in this release, including but not
limited to: (i) the risk that the transaction, including the
contemporaneous private placement of equity securities (the "PIPE
investment"), may not be completed in a timely manner or at all,
which may adversely affect the price of TSIA's securities, (ii) the
risk that the transaction may not be completed by TSIA's business
combination deadline and the potential failure to obtain an
extension of the business combination deadline if sought by TSIA,
(iii) the failure to satisfy the conditions to the consummation of
the transaction, including the adoption of the agreement and plan
of merger by the stockholders of TSIA and Latch, the satisfaction
of the minimum trust account amount following redemptions by TSIA's
public stockholders and the receipt of certain governmental and
regulatory approvals, (iv) the lack of a third party valuation in
determining whether or not to pursue the proposed transaction, (v)
the occurrence of any event, change or other circumstance that
could give rise to the termination of the agreement and plan of
merger or the termination of any PIPE investor's subscription
agreement, (vi) the effect of the announcement or pendency of the
transaction on Latch's business relationships, performance, and
business generally, (vii) risks that the proposed transaction
disrupts current plans of Latch or diverts management's attention
from Latch's ongoing business operations and potential difficulties
in Latch employee retention as a result of the proposed
transaction, (viii) the outcome of any legal proceedings that may
be instituted against Latch, TSIA or their respective directors or
officers related to the agreement and plan of merger or the
proposed transaction, (ix) the amount of the costs, fees, expenses
and other charges related to the proposed transaction and PIPE
investment, (x) the ability to maintain the listing of TSIA's
securities on NASDAQ, (xi) the price of TSIA's securities may be
volatile due to a variety of factors, including changes in the
competitive and highly regulated industries in which Latch plans to
operate, variations in performance across competitors, changes in
laws and regulations affecting Latch's business and changes in the
combined capital structure, (xii) the ability to implement business
plans, forecasts, and other expectations after the completion of
the proposed transaction, and identify and realize additional
opportunities, including the conversion of pre-orders into binding
orders, (xiii) the amount of redemption requests made by TSIA's
public stockholders, (xiv) the ability of TSIA to issue equity or
equity-linked securities in connection with the transaction or in
the future, (xv) possible variances between the unaudited
historical financial information Latch presents and its audited
financial statements, when they become available and (xvi) the
impact of the global COVID-19 pandemic on any of the foregoing. The
foregoing list of factors is not exhaustive. You should carefully
consider the foregoing factors and the other risks and
uncertainties described in the "Risk Factors" section of TSIA's
Registration Statement on Form S-1, the registration statement on
Form S-4 and proxy statement/prospectus described below and other
documents filed by TSIA from time to time with the SEC. These
filings identify and address other important risks and
uncertainties that could cause actual events and results to differ
materially from those contained in the forward-looking statements.
Forward-looking statements speak only as of the date they are made.
Readers are cautioned not to put undue reliance on forward-looking
statements, and Latch and TSIA assume no obligation and do not
intend to update or revise these forward-looking statements,
whether as a result of new information, future events, or
otherwise. Neither Latch nor TSIA gives any assurance that either
Latch or TSIA will achieve its expectations. The inclusion of any
statement in this communication does not constitute an admission by
Latch or TSIA or any other person that the events or circumstances
described in such statement are material.
CONTACTS
Latch
Investors
investors@latch.com
Media
Daniel Teweles
press@latch.com
Or
Leigh Parrish / Jed Repko
Joele Frank, Wilkinson Brimmer
Katcher
212-355-4449
Or
Dan Stocking / Danny Finlay
Current Global
734-755-1650 / 707-372-9050
Tishman Speyer/TS Innovation
Acquisitions Corp
Bud Perrone
Rubenstein
212-843-8068
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SOURCE Latch, Inc.