The Transaction in brief
- Kollect has entered into an agreement to acquire all the shares in Mashup for a purchase price of approximately
SEK 87.7 million . The purchase price is to be paid with a total of 50,113,986 newly issued shares in the Company (the “Consideration Shares”) for which payment shall be made in the form of non-cash consideration consisting of all the shares in Mashup. The board of directors’ resolution on the share issue is conditional upon approval by an extraordinary general meeting in the Company. - The number of Consideration Shares has been calculated using a share price of
SEK 1.75 per share, which represents an approximate 25 per cent premium in relation to the closing share price on Thursday22 February 2024 (SEK 1.40) and a premium of 24 per cent over the VWAP for the 10 trading days ending on Thursday22 February 2024 (SEK 1.41). - Following the issue of the Consideration Shares at the extraordinary general meeting, Kollect's existing shareholders will hold approximately 16 per cent of the shares in the Company and the Sellers will hold approximately 84 per cent in the Company.
- The Transaction is conditional on the completion of a satisfactory due diligence, the extraordinary general meeting of Kollect resolving to carry out the Transaction, and on the Sellers receiving conditional exemption from the obligation to submit a public takeover offer for all shares in the Company from the
Swedish Securities Council . - The extraordinary general meeting to resolve the Transaction is expected to be held on
27 March 2024 . The largest shareholder of Kollect, John O’Connor, who holds 22 per cent of the votes has agreed to enter into customary voting undertakings regarding the proposals to be put forward in connection with the Transaction. - The Company has received consent on the Transaction from its lender
Beach Point Capital , which also confirms that the debt financing condition to delist from the Nasdaq First North Growth Market, which was announced through the Company’s press release on4 September 2023 , shall be waived upon completion of the Transaction. - The Company has engaged with Nasdaq to confirm that the Transaction does not trigger any relisting process requirements at this time.
- Upon completion of the Transaction, the Sellers have agreed to enter into a 12 month lock up agreement for the Consideration Shares received.
Information about Mashup
Mashup owns a 78-acre property in
The property has been independently valued at
Mashup is currently beneficially majority-owned by
Description of the Transaction
The Company has been looking for opportunities in the physical recycling and waste industry. The acquisition of Mashup will provide the Company with a very substantial freehold property that has the necessary planning permissions to support this expansion.
In addition to creating new opportunities for the Company, the Transaction will also result in the Company’s net assets increasing by approximately
The purchase price is to be paid with a total of 50,113,986 Consideration Shares for which payment shall be made in the form of non-cash consideration consisting of all the shares in Mashup. The board of directors has today, subject to the approval of a subsequent extraordinary general meeting, resolved on the issue of the Consideration Shares directed to
The Sellers have agreed to enter into a lockup undertaking regarding the Consideration Shares received as a result of the Transaction for a period of 12 months following completion of the Transaction.
The Transaction is conditional on the completion of a satisfactory due diligence, the extraordinary general meeting of Kollect resolving to carry out the Transaction, and on the Sellers receiving conditional exemption from the obligation to submit a public takeover offer for all shares in the Company from the
The Company has received consent on the Transaction from its lender
It is the board of directors’ assessment that the terms and conditions of the acquisition are on market terms, which is also motivated by the independent valuation prepared by
Comment from the CEO
I am delighted to present this acquisition opportunity to the shareholders of Kollect. Whilst we have fundamentally been a technology business, the acquisition of
Furthermore, I believe that the transaction provides a strong upside for shareholders. In addition to the benefits outlined above, the transaction has been completed at a more than 20% premium to our share price. The requirement to delist, which was a part of our debt financing raised in Q3 2023, will also be removed from the debt financing arrangement, upon completion of the Transaction.
As the largest single shareholder in the Company at the moment, I strongly support this transaction and hope my fellow shareholders will do the same at the EGM.
John O’Connor, Founder and CEO of Kollect
Ownership structure following the Transaction and changes in the amount of shares and share capital
The proposed Transaction will significantly increase the number of shares outstanding in the Company as payment for all the shares in Mashup will be made through a non-cash issue of new shares in
Exemption from mandatory bid requirements
Through the Transaction, the Sellers, will acquire an ownership stake in the Company equivalent to at least 30 percent of the total voting rights for the total number of shares in the Company. The Sellers will be applying for conditional exemption from the
Extraordinary general meeting
The Company's acquisition of Mashup will be subject to the approval of the extraordinary general meeting of the Company expected to be held on
Shares, share capital and dilution
Provided that the extraordinary general meeting resolves to approve the Transaction, the share capital will increase by approximately
Advisors
Eversheds Sutherland Advokatbyrå AB has acted as legal advisor to the Company in connection with the Transaction in
For additional information, please contact
Phone: [+353] 85 871 9756
E-mail: jamie@kollect.ie
Kollect on Demand Holding AB’s Certified Adviser is Mangold
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