NEW YORK CITY, September 6, 2022 / PRNewswire / — Parallaxes Capital Management (“Parallaxes”), the premier investment firm focused exclusively on monetizing Tax Receivable Agreements (“TRAs”), is pleased to share a notable development in the market as Graham Packaging Company, Inc. (“Graham Packaging”) previously terminated its TRA.
Graham Packaging disclosed that after having been acquired by Reynolds Group Holdings Limited (“Reynolds”), Reynolds will be making an aggregate cash payment of $245 million pursuant to contractual change in control provisions in Graham Packaging’s TRAs with Blackstone Capital Partners III L.P. and the Graham family. The Graham Packaging TRAs provided for the payment of 85% of the net cash tax savings realized from certain tax attributes, including savings from (i) the utilization of net operating losses attributable to periods prior to the IPO, (ii) certain increases to the tax basis of the assets of Graham Packaging Holdings Company (“Holdings”), including from exchanges of limited partnership units for common stock of Graham Packaging, and (iii) other tax benefits related to Graham Packaging’s entrance into the TRAs, including tax benefits attributable to payments under the TRAs.
Parallaxes views TRAs, including the Graham Packaging TRA, as a valuable tool to reduce certain moral hazard problems and informational asymmetry inherent in a company’s public offering. TRAs help ensure that pre-IPO owners are economically aligned with new public shareholders and incentivize pre-IPO owners to pursue an IPO structure that provides the company with ongoing tax benefits. Parallaxes anticipates enhanced awareness and understanding of TRAs will drive increased market adoption.
About Parallaxes Capital
Parallaxes Capital Management (“Parallaxes”) is the premier investment firm focused exclusively on monetizing Tax Receivable Agreements (“TRAs”). Parallaxes offers private equity sponsors, co-investors and management team members solutions to achieve liquidity, diversification and optionality from their TRAs. Parallaxes was founded in 2017 and is comprised of experienced investment professionals from leading private equity and growth equity firms. To learn more, please visit www.plxcap.com
This press release should not be regarded as representative of an official position or statement of Parallaxes or any related entity.