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United States securities and exchange commission logo
March 10, 2022
Peter Yu
Chief Executive Officer
Cartesian Growth Corporation
505 Fifth Avenue, 15th Floor
New York, NY 10017
Re: Cartesian Growth
Corporation
Registration
Statement on Form S-4
Filed February 11,
2022
File No. 333-262644
Dear Mr. Yu:
We have reviewed your registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so
we may better
understand your disclosure.
Please respond to this letter by amending your registration
statement and providing the
requested information. If you do not believe our comments apply to your
facts and
circumstances or do not believe an amendment is appropriate, please tell
us why in your
response.
After reviewing any amendment to your registration statement and
the information you
provide in response to these comments, we may have additional comments.
Form S-4 filed February 11, 2022
General, page i
1. Please quantify the
aggregate dollar amount and describe the nature of what the sponsor
and its affiliates have
at risk that depends on completion of a business combination.
Include the current
value of securities held, loans extended, fees due, and out-of-pocket
expenses for which the
sponsor and its affiliates are awaiting reimbursement. Provide
similar disclosure for
the company s officers and directors, if material.
2. Please highlight the
risk that the sponsor will benefit from the completion of a business
combination and may be
incentivized to complete an acquisition of a less favorable target
company or on terms
less favorable to shareholders rather than liquidate.
3. Quantify the value of
warrants, based on recent trading prices, that may be retained by
Peter Yu
FirstName LastNamePeter Yu
Cartesian Growth Corporation
Comapany
March NameCartesian Growth Corporation
10, 2022
March2 10, 2022 Page 2
Page
FirstName LastName
redeeming stockholders assuming maximum redemptions and identify any
material
resulting risks.
4. Please highlight material differences in the terms and prices of
securities issued at the time
of the IPO as compared to any private placement contemplated at the
time of the business
combination. Disclose if the SPAC's sponsors, directors, officers or
their affiliates will
participate in the private placement.
Questions and Answers about the Proposals, page 15
5. Please include a Question and Answer discussing the fact that
Cartesian and the Target
Companies currently operate as separate companies with no prior
history as a combined
entity and their operations have not been previously managed on
combined basis. Please
also describe any affiliation between the companies.
Questions and Answers about the Proposals, page 18
6. You disclose that pursuant to the Business Combination Agreement, TWMH
and TIG
Entities will receive 29.8% and 70.2%, respectively of cash
consideration. We also note
that you disclose on page 222 in footnote (1) that the economic and
voting interests in
Alvarium Tiedemann assumes that secondary share purchase happened
after the Business
Combination and then on page 243, that you disclose that adjustment
(e) of Note 3 reflects
the use of $100 million representing the secondary purchase of
partnership interests in
Alvarium Tiedemann. Please reconcile these statements and clarify your
disclosures, as
necessary, to consistently reflect the terms and sequence of the
Business Combination
transaction with the underlying terms of the related agreement.
What vote is required to approve each proposal at the Special Meeting?, page 29
7. Please revise to discuss here and on page 118 what percentage of
public shareholders need
to vote in favor of the Business Combination Proposal and
Domestication Proposal in
order to approve the proposals. In that regard we note that your
Sponsor, directors and
officers have agreed to vote any Founder Shares or Ordinary Shares
owned by them in
favor of the proposals.
Summary of the Proxy Statement/Prospectus, page 35
8. Please provide a graphic depiction of the Target companies and
Cartesian prior to the
business combination. Please also include a post-combination
organizational chart that
includes the percentage of voting power that Cartesian's current
public shareholders will
have, taking into account the voting power of any Class B shares.
Summary of Historical Consolidated Financial Information of the TIG Entities,
page 51
9. Please enhance your description to clarify the nature of the one-time
accrual adjustment of
$6.313 million to TIG Entities Net Income to reflect your recurring
performance for the
year ended December 31, 2020 in arriving at Adjusted EBITDA , conform
your
Peter Yu
FirstName LastNamePeter Yu
Cartesian Growth Corporation
Comapany
March NameCartesian Growth Corporation
10, 2022
March3 10, 2022 Page 3
Page
FirstName LastName
description throughout the filing and tell us the non-GAAP guidance
you relied on in
recognizing this adjustment.
10. You disclose that you have a 50.63% profit share in the TIG Arbitrage
strategy. Please
enhance your disclosures to explain the terms of the underlying
agreement, how this profit
share is accounted for in the related unaudited and audited financial
statements as of
September 30, 2021 and December 31, 2020 and 2019 and if not why.
Cartesian has not obtained an opinion from an independent investment banking
firm, page 70
11. Please disclose the basis for the board determining it was not
necessary to obtain a
fairness opinion for the business combination. In this regard, we note
from your
disclosure on page 139 that you engaged BofA Securities as a financial
advisor.
Your unexpired Warrants may be redeemed prior to their exercise at a time that
is
disadvantageous to you, page 113
12. Please clearly explain the steps, if any, the company will take to
notify all shareholders,
including beneficial owners, regarding when the warrants become
eligible for
redemption. Please also expand your disclosure on page 414 to describe
the notice of
redemption and the method of such notification.
Our Proposed Charter will provide, subject to limited exceptions, that the
Court of Chancery of
the State of Delaware, page 114
13. We note that your risk factor discusses the additional costs you could
incur associated
with resolving such action in other jurisdictions. Please also
describe the risk that the
choice of forum provision may increase the costs for shareholders to
bring a claim.
Background of the Business Combination, page 123
14. We note the disclosure on page 139 that you formally engaged BofA
Securities as a
capital markets advisor and financial advisor on September 19, 2021.
Please provide a
description of the role BofA Securities played in the various
transactions as your financial
advisor, as well as the level of diligence the it performed in
connection with the
transactions.
15. Please disclose any discussions relating to the assumptions underlying
any target
projections.
16. Please disclose the negotiation/marketing processes related to
obtaining additional
financing for the combined company, such as who selected the potential
PIPE
investors; what relationships did the PIPE investors have to the SPAC,
the sponsors, the
target and its affiliates, and the placement agent; and how were the
terms of the PIPE
transactions determined. Also, disclose whether there were any
valuations or other
material information about the SPAC, the target, or the transactions
provided to potential
PIPE investors that have not been disclosed publicly.
Peter Yu
FirstName LastNamePeter Yu
Cartesian Growth Corporation
Comapany
March NameCartesian Growth Corporation
10, 2022
March4 10, 2022 Page 4
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FirstName LastName
17. Please disclose the negotiation of any arrangements whereby any
shareholder agrees to
waive its redemption rights.
Unaudited Pro Forma Condensed Combined Financial Information, page 220
18. You disclose that the Business Combination Agreement between TWMH, the
TIG
Entities and Alvarium will be accounted for using the acquisition
method of accounting
because Alvarium Tiedemann (formally Cartesian Growth Corporation) has
been
determined to be the accounting acquirer based on the following facts:
Alvarium Tiedemann Capital LLC (Umbrella), which will hold 100% of
the equity of
TWMH, the TIG Entities and Alvarium, is a variable interest entity
( VIE );
Alvarium Tiedemann will be the sole managing member and primary
beneficiary of
Umbrella who has full and complete charge of all affairs of
Alvarium Tiedemann,
and the Class A units of Alvarium Tiedemann do not have
substantive participating
or kick out rights;
No single party controls Umbrella pre and post transaction, hence,
the Business
Combination is not considered a common control transaction; and
Upon consummation of the Business Combination, the combined
company will be
organized in an Up-C structure and that Alvarium Tiedemann
will hold Umbrella,
which in turn will hold a newly formed entity that will ultimately
be named
Alvarium Tiedemann Holdings, LLC which will become the
wholly owned direct
subsidiary of Umbrella.
Please address the following:
Enhance your disclosures to clarify the interests Alvarium
Tiedemann will hold in
Umbrella and Umbrella will hold in Alvarium Tiedemann Holdings,
LLC;
Revise to clarify, as it appears that Alvarium Tiedemann controls
itself based on this
disclosure; and
Revise your disclosures accordingly to address the inconsistency
between the
diagram of the Company s organizational structure immediately
following the
Completions of the Business Combination on page 228 that reflects
Alvarium
Tiedemann Holdings, LLC holding 100% of the equity of TWMH, the
TIG Entities
and Alvarium and the disclosure above.
19. You disclose that you have a 50.63% profit share in the TIG Arbitrage
strategy. Please
disclose how this is reflected in the Unaudited Pro Forma Condensed
Combined Financial
Information.
Note 3. Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet as
of
September 30, 2021, page 243
20. Please tell and enhance your disclosures to explain how you determined
each of the
components of the Total consideration for allocation of $1,091.3
million assuming no
redemptions as presented in footnote (f), how this reconciles to the
aggregate value of the
consideration to be paid to the shareholders of Alvarium, the TIG
Entities and the
Peter Yu
FirstName LastNamePeter Yu
Cartesian Growth Corporation
Comapany
March NameCartesian Growth Corporation
10, 2022
March5 10, 2022 Page 5
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FirstName LastName
members of TWMH pursuant to the Business Combination Agreement of
$1,079.9 million
disclosed on page 152, why the $100 million of cash consideration as
disclosed on page
153 is not included and and explain to us what "equity rollover"
consideration represents.
21. We note adjustment (e) on page 243 for $100 million. Please describe
more fully this
adjustment. To the extent entities are identified inconsistently
within the filing, please
revise to provide a consistent description.
Note 6. Earnings/Loss per Share, page 248
22. You disclose that prior to the Business Combination, Alvarium
Tiedemann s historical
equity structure was not unitized, and therefore the calculation of
book value per share is
not a useful metric. Please address the following:
Tell us why if the historical book value per share is not a
useful metric you have
disclosed; and
Tell us and enhance your disclosures to explain why you have
included non-
controlling interest in subsidiaries of $522.9 million and
$535,760 million in the
calculations of Pro Forma combined book value per share of $15.59
and $19.78,
assuming no and maximum redemptions, respectively, but excluded
the related Class
B shares outstanding of 52.3 million.
Committees of the Board of Directors, page 263
23. We note your disclosure on page 93 that you are exposed to data and
cybersecurity
risks. To the extent cybersecurity risks are material to your
business, please disclose here
or in another appropriately captioned section the nature of the board
s role in overseeing
your cybersecurity risk management, the manner in which the board will
administer this
oversight function and any effect this will have on the board s
leadership structure.
Business of Alvarium Tiedemann, page 266
24. We note the disclosure that the combined company will have billions of
dollars in assets
under management. Please provide us with information and analysis
under Section 3 of
the Investment Company Act of 1940 ("1940 Act") with respect respect
to whether
Alvarium Tiedemann Holdings, Inc. will be an investment company within
the meaning
of the Act. As part of the response, please identify and explain
(including a detailed
calculation on an unconsolidated basis) what assets that will be held
by the combined
company are "investment securities" for the purposes of Section 3 of
the Act, as well as
identifying the percentage of the value of AlTi's total assets will be
"investment
securities." As part of the response please also include an analysis
of any exemptions you
rely upon, if applicable, or advise. Please also include risk factor
disclosure, with a
separate subheading, discussing the risk to your company if you are
deemed an investment
company subject to regulation under the Investment Company Act. Please
note that we
may refer your response to the Division of Investment Management.
Peter Yu
FirstName LastNamePeter Yu
Cartesian Growth Corporation
Comapany
March NameCartesian Growth Corporation
10, 2022
March6 10, 2022 Page 6
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FirstName LastName
Fund Management Fees, page 276
25. You disclose that you have a 50.63% profit share in the TIG Arbitrage
strategy. Please
disclose the contractual terms of this arrangement including when you
entered into this
agreement to also explain why such profit share is not reflected in
the related unaudited
and audited TIG financial statements for the periods presented.
Our Presence to Date, page 280
26. We note your presence in Hong Kong. Please include risk factor
disclosure to discuss any
risks to your company from its presence in Hong Kong, including risks
that the Chinese
government may intervene or influence your operations in Hong Kong at
any time. Please
also quantify any investment in companies with significant Hong Kong
operations to the
extent practicable so that investors can assess the risk or advise.
Management's Discussion and Analysis of Financial Condition and Results of
Operations for
TWMH, TIG Entities and Alvarium, page 318
27. Please disaggregate your AUM rollfowards for both TWMH and TIG
Entities, by product
and strategy and discuss period over period changes.
28. Please disaggregate revenues by type, product and strategy for both
TWMH and TIG
Entities, and discuss period over period changes.
29. Please disaggregate General, administrative and other expenses and
cost of sales and
operating expenses, by type for each TWMG, TIG Entities and Alvarium
and discuss
period over period changes
Management's Discussion and Analysis of Financial Condition and Results of
Operations of the
TIG Entities
TIG Fund Summary, page 346
30. Please disclose why Management and Performance fees are included as an
addition in the
AUM rollforwards for the period presented.
Results of Operations-Revenue, page 349
31. In your disclosure on page 350, you discuss the incentive fees that
would have been
recognized for the nine month period ended September 30, 2021 "if the
end of the nine-
month period were the end of a measurement period" and disclose
resulting impact to
Economic EBITDA . Please tell us how you determined this is not a
"tailored revenue
recognition and measurement method" prohibited under Rule 100(b) of
Regulation G and
addressed in the staff's non-GAAP C&DI question 100.4.
Peter Yu
FirstName LastNamePeter Yu
Cartesian Growth Corporation
Comapany
March NameCartesian Growth Corporation
10, 2022
March7 10, 2022 Page 7
Page
FirstName LastName
Reconciliation of Combined and Consolidated GAAP Financial Measures to Certain
Non-GAAP
Measures, page 352
32. As it relates to your Economic EBITDA non-GAAP financial measure,
please provide the
information required by Item 10(e)(1)(i)(C) of Regulation S-K,
including why the
adjustment in not reflected in GAAP Net Income.
Beneficial Ownership of Securities, page 399
33. Please provide the natural person(s) who have voting and dispositive
control over the
shares owned by CGC Sponsor LLC.
Description of Securities, page 403
34. We note your disclosure on page 409 and elsewhere that certain
shareholders agreed to
waive their redemption rights. Please describe here, and on page 23
under "Do I have
Redemption Rights," any consideration provided in exchange for this
agreement.
Material U.S. Federal Income Tax Considerations, page 426
35. We note that the business combinations agreement indicates that the
parties intend for the
Domestication to be treated as a reorganization under Section 368(a)
of the Internal
Revenue Code. If you believe the business combination will be tax
free, please disclose
an opinion of counsel that supports this conclusion. Furthermore,
indicate whether the
receipt of a tax opinion as to the tax free nature of the transaction
is a condition to the
business combination. Refer to Item 601(b)(8) of Regulation S-K and
our Staff Legal
Bulletin No. 19.
Index to Financial Statements
Financial Statement of TWMG, TIG Entities and Alvarium, page F-1
36. Please provide disaggregated revenue disclosures as required by ASC
606-10-50-5 for
each TWMH, TIG Entities and Alvarium.
TWMH Financial Statements
(16) Members Capital, page F-87
37. Based on your disclosure, it appears that non-employee members have a
put option on the
Class B shares they they own. Please tell us how accounted for the put
options on the
Class B shares. Further, tell us why the information included in the
footnote does not
appear to be included in your annual financial statements for the
period ended December
31, 2020.
4. Investments, page F-98
38. You disclose that on October 24, 2019, you acquired 40% of the common
stock of
Tiedemann Constantia AG for $4.95 million. Please address the
following:
Peter Yu
Cartesian Growth Corporation
March 10, 2022
Page 8
Tell us and enhance your disclosure to clarify how this
acquisition is reflected in the
related consolidated statement of cash flows;
Enhance your disclosure to provide a rollforward of the
investment from date of
acquisition through the periods presented; and
Tell us and enhance your disclosures to explain why the fair
value of this investment
has not changed since the acquisition date despite recurring
losses and how you
considered from an impairment perspective.
TIG Entities Financial Statements
12. Subsequent Events, page F-103
39. Regarding your "settlement agreement with respect to an outstanding
legal action" for
which a payable was recognized as of your December 31, 2020 balance
sheet date, please
provide the information required by ASC 450-20-50-1 in both your
annual and interim
financial statements. Specifically, the facts and circumstances which
generated the legal
action, the amount accrued, and whether additional amounts may need to
be accrued
depending on additional information that may arise regarding the
settlement agreement.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Refer to Rules 460 and 461 regarding requests for acceleration. Please
allow adequate
time for us to review any amendment prior to the requested effective date of
the registration
statement.
You may contact Jacob Luxenburg at 202-551-2339 or Michelle Miller at
202-551-
3368 if you have questions regarding comments on the financial statements and
related
matters. Please contact John Stickel at 202-551-3324 or Susan Block at
202-551-3210 with any
other questions.
FirstName LastNamePeter Yu Sincerely,
Comapany NameCartesian Growth Corporation
Division of
Corporation Finance
March 10, 2022 Page 8 Office of
Finance
FirstName LastName