Pagaya Technologies’ Combination With EJF Acquisition Corp.

Simpson Thacher & Bartlett advised EJFA, while Skadden, Arps, Slate, Meagher & Flom and Goldfarb Seligman & Co. advised Pagaya on the deal.
Herzog Fox & Neeman advised EJF Acquisition Corp. on the deal.

Pagaya Technologies Ltd. (“Pagaya”) announced with EJF Acquisition Corp., a publicly traded special purpose acquisition company, that they have entered into a definitive business combination agreement. As a result of the transaction, which values the combined company (the “Company”) at an estimated enterprise value of approximately $8.5 billion at closing, Pagaya will become a publicly listed entity and trade under a new ticker symbol.

The transaction values the Company at a pro forma implied enterprise value of approximately $8.5 billion at closing. The transaction includes $288 million in gross proceeds from EJFA’s cash in trust (assuming no redemptions) and $200 million in gross proceeds from a fully committed private placement in public equity (“PIPE”) from entities associated with EJFA that will close concurrently with the business combination. Additional targeted financing transactions or assignments may be considered.

Existing Pagaya equity holders, including current investors and employees of the firm, are expected to retain an approximately 94% ownership stake in the Company. The business combination, which has been unanimously approved by the boards of directors of both Pagaya and EJFA, is targeted to close in early 2022, subject to shareholder approvals and other customary closing conditions. 

Upon closing, Pagaya’s Class A ordinary shares and public warrants began trading on the Nasdaq stock market on June 23, 2022 under the ticker symbols “PGY” and “PGYWW,” respectively.

Pagaya is a financial technology company that enables financial institutions to expand access to more customers through its artificial intelligence network.

Founded in 2005 by Manny Friedman and Neal Wilson, EJF is a global alternative asset management firm headquartered outside of Washington, D.C. As of June 30, 2021, EJF manages approximately $9.4 billion across a diverse group of alternative asset strategies, including $3.4 billion in managed structured product assets. 

UBS Investment Bank served as lead financial and capital markets advisor to EJFA. Barclays also served as financial and capital markets advisor to EJFA. Duff & Phelps, A Kroll Business, rendered a fairness opinion to EJFA’s Board of Directors. J.P. Morgan Securities LLC served as exclusive financial advisor to Pagaya.

The Simpson Thacher team included Jonathan Corsico (Picture), Michael Wolfson, John Dougherty, Matthew Richardson, Erin Harvey and Anthony Ricci (M&A); Mark Brod, Joshua Bonnie, Arielle L. Katzman, Jonathan Pacheco, Sean Dougherty, Emma O’Hara, Alex Suh,Evan Hunt and Charlotte Bowe (Capital Markets); Benjamin Rippeon and William Smolinski (Tax); Lori Lesser, Melanie Jolson and Hilary Wong (Intellectual Property); Jeannine McSweeney, Harry Hudesman and Ryan Kenny (Executive Compensation and Employee Benefits); Kelly Karapetyan (Antitrust); Abram Ellis and Christine Tillema (Regulatory); Krista McManus, Stephanie Kantor and Stephanie Brenner (Real Estate); David Blass, Jamie Hahn and Radhika Kshatriya (Registered Funds); and Chris Brown and Cem Islicki (Banking and Credit); and Michael Isby (Environmental).

The Skadden team included M&A partners Jeffrey Brill and Maxim Mayer-Cesiano, and associates Jack Rossman, Kyle Cotteleer, Hanson Lee and Jaclyn Kleban; Tax partner B. Chase Wink and counsel Nazmiye Gokcebay; Capital Markets partner Andrea Nicolás and associate Kathy Shao; Executive Compensation and Benefits partner Erica Schohn; and Intellectual Property and Technology counsel Jessica Cohen. 

Herzog Fox & Neeman’s team was led by Yair Geva, Ory Nacht and Michal Herzfeld, and includes Nesimyan Adawi, Nir Gal, Shachar Porat, Dr. Ehab Farah, Amir Cooper, Liat Maidler, Daniel Kaczelnik, Neta Dorfman, Irit Roth, Danny Rosenblatt, Karen Elburg, Yuval Haimovich, Chen Arobas and Olga Pery.

Involved fees earner: Anthony Ricci – Davis Polk & Wardwell; Nesimyan Adawi – Herzog Fox & Neeman; Chen Arobas – Herzog Fox & Neeman; Amir Cooper – Herzog Fox & Neeman; Neta Dorfman – Herzog Fox & Neeman; Karen Elburg – Herzog Fox & Neeman; Ehab Farah – Herzog Fox & Neeman; Nir Gal – Herzog Fox & Neeman; Yair Geva – Herzog Fox & Neeman; Yuval Haimovitch – Herzog Fox & Neeman; Michal Herzfeld – Herzog Fox & Neeman; Daniel Kaczelnik – Herzog Fox & Neeman; Liat Maidler – Herzog Fox & Neeman; Ory Nacht – Herzog Fox & Neeman; Olga Pery – Herzog Fox & Neeman; Shachar Porat – Herzog Fox & Neeman; Danny Rosenblatt – Herzog Fox & Neeman; Irit Roth – Herzog Fox & Neeman; David Blass – Simpson Thacher & Bartlett; Charlotte Bowe – Simpson Thacher & Bartlett; Stephanie Brenner – Simpson Thacher & Bartlett; Mark Brod – Simpson Thacher & Bartlett; Christopher Brown – Simpson Thacher & Bartlett; Jonathan Corsico – Simpson Thacher & Bartlett; Sean Dougherty – Simpson Thacher & Bartlett; John Dougherty – Simpson Thacher & Bartlett; Abram Ellis – Simpson Thacher & Bartlett; Joshua Ford Bonnie – Simpson Thacher & Bartlett; James Hahn – Simpson Thacher & Bartlett; Erin Harvey – Simpson Thacher & Bartlett; Harry Hudesman – Simpson Thacher & Bartlett; Evan Hunt – Simpson Thacher & Bartlett; Michael Isby – Simpson Thacher & Bartlett; Cem Islikci – Simpson Thacher & Bartlett; Melanie Jolson – Simpson Thacher & Bartlett; Stephanie Kantor – Simpson Thacher & Bartlett; Kelly Karapetyan – Simpson Thacher & Bartlett; Arielle Katzman – Simpson Thacher & Bartlett; Ryan Kenny – Simpson Thacher & Bartlett; Radhika Kshatriya – Simpson Thacher & Bartlett; Lori Lesser – Simpson Thacher & Bartlett; Krista McManus – Simpson Thacher & Bartlett; Jeannine McSweeney – Simpson Thacher & Bartlett; Emma O’Hara – Simpson Thacher & Bartlett; Jonathan Pacheco – Simpson Thacher & Bartlett; Matthew Richardson – Simpson Thacher & Bartlett; Benjamin Rippeon – Simpson Thacher & Bartlett; William Smolinski – Simpson Thacher & Bartlett; Alexander Suh – Simpson Thacher & Bartlett; Christine Tillema – Simpson Thacher & Bartlett; Michael Wolfson – Simpson Thacher & Bartlett; Hilary Wong – Simpson Thacher & Bartlett; Jeffrey Brill – Skadden; Jessica Cohen – Skadden; Kyle Cotteleer – Skadden; Nazmiye Gokcebay – Skadden; Jaclyn Kleban – Skadden; Hanson Lee – Skadden; Maxim Mayer-Cesiano – Skadden; Andrea Nicolas – Skadden; Jack Rossman – Skadden; Erica Schohn – Skadden; Kathy Shao – Skadden; Chase Wink – Skadden;

Law Firms: Davis Polk & Wardwell; Herzog Fox & Neeman; Simpson Thacher & Bartlett; Skadden;

Clients: EJF Acquisition Corp.; Pagaya Technologies;