Allen & Overy, Morrison Foerster guide WillScot’s $3.8bn McGrath acquisition

A&O reps WillScot as modular office lease company moves to expand presence across North America

Allen & Overy (A&O) is advising WillScot Mobile Mini on its $3.8bn acquisition of California-based business-to-business rental company McGrath RentCorp, repped by Morrison & Foerster (MoFo).  

The cash-and-stock deal comes as WillScot, which is headquartered in Phoenix, Arizona and leases modular offices and portable storage units, looks to expand its presence across North America.  

The company said the acquisition would enhance its position as a “leader in turnkey space solutions with a complementary geographic footprint and a more diversified platform, providing enhanced value across key customer segments”. 

Under the terms of the deal, McGrath shareholders will receive either $123 in cash or 2.8211 shares of WillScot common stock for each share held.  

The transaction values McGrath at an enterprise value of $3.8bn, including around $800m of net debt, and the per-share consideration represents a premium of 10.1% to McGrath’s closing stock price on 26 January.  

WillScot Mobile Mini is a longstanding client of A&O, the UK Magic Circle firm having advised WillScot in 2020 on its $6.6bn merger with Mobile Mini, advised by Davis Polk & Wardwell.

A&O placed 24th in LSEG’s global M&A legal advisor rankings by deal value in 2023, after working on 241 deals worth $97.2bn. The result saw the firm rise four places from its 2022 ranking but nevertheless saw it remain behind its international Magic Circle rivals, with Freshfields Bruckhaus Deringer coming in seventh and Clifford Chance and Linklaters placing 15th and 17th respectively. MoFo was not among the top 25 legal advisors.  

The MoFo team acting for longtime client McGrath in its acquisition by WillScot was led by San Francisco-based corporate partner Jackie Liu, together with corporate associates Amy Chen and Daigo Takahashi.  

Last year Liu and Takahashi also led a MoFo team that advised McGrath on its $400m cash acquisition of Vesta Modular from parent company Kinderhook Industries and the $265m cash sale of Adler Tank Rentals to Ironclad Environmental Solutions, another Kinderhook portfolio company. 

WillScot CEO Brad Soultz said the McGrath acquisition would accelerate the growth of the company which had combined 2023 pro forma revenue of $3.2bn and adjusted EBITDA of $1.4bn.  

“We will be on path to achieve a $700m free cash flow run-rate 12 months after we close,” he said. “Our long-term capital allocation framework remains unchanged as we continue to accelerate our growth with highly accretive M&A, all the while creating long-term value for our shareholders.” 

BofA Securities served as financial advisor and Rothschild & Co served as financing advisor to WillScot, while Goldman Sachs served as financial advisor to McGrath.

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