This article is available in Swedish here.
Dear shareholder of Bricknode Holding AB (“BNH”), more than a year has now passed since the deal with Huddlestock was closed where Huddlestock acquired all operational assets of Bricknode. A lot of work has been conducted within both Bricknode and Huddlestock during this time to combine the assets of both company groups.
Everything is now prepared for starting the process where you will be offered to exchange your shares in BNH to shares of Huddlestock Fintech AS. To better understand what Huddlestock is we have prepared a short presentation that you can download and view below:
Why have this taken so long?
When the operational assets of BNH (the subsidiaries of BNH) were acquired by Huddlestock, BNH had outstanding loans of roughly 19 million SEK. At the time of acquisition the share price of Huddlestock was around 2.6 NOK per share.
Since the only asset of BNH following the acquisition was shares in Huddlestock, BNH needed to either sell shares to free up cash or agree with lenders to convert loans to shares in Huddlestock, or a combination of both. No BNH shares could be exchanged for Huddlestock shares until the remaining loans where reduced to a level where BNH with confidence could re-pay those loans before closing down the company.
Unfortunately the falling stock price of Huddlestock (down to as low as 0.62 NOK per share) made this process very long and BNH had to sell more shares than anticipated to close as much loans as possible.
Now we are ready to get going!
As of this writing the outstanding debt has been reduced from 19 million SEK down to roughly 850,000 SEK and the cash position of BNH is around 600,000 SEK which means a difference of only about 250,000 SEK.
The so called “Redemption process” where BNH redeems shares of BNH in exchange for shares in Huddlestock will cost some money but BNH is confident that the remaining loan can be closed before finally closing BNH. The bulk of the legal costs for drafting documents and preparing the process has already been paid and prepared.
What will happen now?
Starting week 22, BNH will launch the formal process which will result in that you will be contacted by your bank/broker where you have your BNH shares. You will be asked if you want to convert BNH shares to Huddlestock shares and what the details are. Each bank/broker has their own process for this and the time until you get notified can vary. We will announce on this site when your bank/broker has been notified. On this site we will publish the general details as well.
There will be two redemption events
Because of financial regulations, BNH is not allowed to hold more shares than what would represent less than 10 % ownership in Huddlestock. Because of that BNH will have to first distribute as many Huddlestock shares that it currently holds in its account. Following the completed distribution BNH can claim the remaining tranche of shares which it then can proceed to distribute.
BNH has so far received 22,800,000 Huddlestock shares. BNH currently owns 7,771,326 Huddlestock shares which are going to be distributed in the first redemption process.
Following the completion of the first redemption process BNH will be able to claim the remaining 18,338,911 Huddlestock shares which Huddlestock will issue as new shares. With regards to Huddlestock the outstanding shares that it “owes” to BNH is shown as a debt on the balance sheet of Huddlestock and will be reduced with the same amount when the shares are issued.
What will happen after the final redemption
Following the completion of the final redemption there will be no assets or liabilities left in BNH and the board of directors will finalize the closing down of BNH which will stop to exist as a company.
Additional information
By visiting the website of Huddlestock you can find additional information about the company that you will soon be a shareholder of.
On his personal blog, Stefan Willebrand has written an article that explains his view on Huddlestock.