The extraordinary general meeting (EGM) held on 25 November decided on changes to the Board of Directors of Mash, appointing four members of the Board: Tommi Lindfors, Samuli Korpinen, Jonas Lindholm and Risto Illukka. The EGM also decided on authorizations regarding the issue of A- and E-shares. The authorizations are related to the execution of a conversion proposal directed to the company’s bondholders. Reasons for the proposal include the improvement of the company’s funding structure and its challenging liquidity situation.
The abovementioned situation is due to the fact that the company was unable to refinance a bond expiring on14 November due to challenging financial market conditions. Because a delay in the repayment of one bond causes a risk of a cross-default of other funding, the company’s board of directors proposed to the EGM to decide on corporate restructuring in order to ensure the normal function and growth of the company in case creditors would claim their receivables early. The EGM decided to approve the potential application for corporate restructuring. The Board, however, wishes to emphasize that the application and the decision can be and will be cancelled, in case the company’s current voluntary conversion offer or other negotiated agreement is successful enough for the company.
The company’s board of directors is pleased with the decisions, because they enable the fast and efficient execution of the voluntary proceedings and, through the official process, secure the company’s operations in a more challenging situation. With this, the company seeks to ensure the best possible outcome for the company, its shareholders and creditors and the continued utilization of the Group’s international growth potential.
“The meeting was generally positive, although the situation is of course not nice for anyone. Both the owners and financers strongly believe in the company’s future. This is very important, because we have hundreds of thousands of customers and thousands of partners, for whom our number one priority is now to fulfil our responsibilities and ensure continued services”, says Mash Group Chairman Tommi Lindfors.
Group CEO Gaëtan Van Wynsberghe is also pleased with the meeting decisions: “This provided the company with necessary tools for discussions with our creditors and makes it possible to find a solution to our recent financial issues. Our goal is that the company can go forward stronger than before.”
The company will next actively negotiate with its creditors on the best solutions for the company’s continued success, while keeping shareholders and partners up to date with the status of the negotiations and the conversion offer.
The following events which may have a material effect on the company i.e. Mash Group Plc, Business ID 2237990-4 (“Mash” or “Company”) have occurred after the preparation of the last financial statements as at 31 December 2018:
- Mash was unable to make a payment of EUR 17.7 million euro under its bonds on Thursday 14.11.2019. This has initiated a 7-day cure period ending on Thursday 21.11.2019 at noon. Should the unpaid sums with some other current liabilities not be fully covered by that date (approximately EUR 50 million) all of the group’s existing third-party debt of approximately EUR 190 million containing a cross-default clause may be accelerated which means an immediate repayment is expected. The decisions which the Board of Directors proposes to be taken by the Extraordinary General Meeting of Shareholders convening 5.11.2019 are necessary for preventing the above-mentioned cross default which could lead to insolvency and even bankruptcy of the Company.
- During November Martin Dobbins, John Matthews and Ronald Latenstein resigned from the Company’s Board of Directors. Board member Riitta Salonen has informed that due to personal reasons she is not available upon the election of the new members of the Board of Directors by the Extraordinary General Meeting of Shareholders on 25.11.2019.
- 8.11.2019 the Extraordinary General Meeting of Shareholders resolved to authorize the Board of Directors in accordance with the proposal of the Board of Directors to decide on issuance of up to 30 million new or existing shares, option rights and other special rights to shares, including also directed issues. The reference is made to the proposal of the Board of Directors which was enclosed to the notice dated 31.10.2019 to the Extraordinary General Meeting of Shareholders.
- 6.11.2019 Mash and Ingenico announced that they have signed a collaboration agreement to provide Mash’s innovative “pay later” solution to Merchants across Spain.
- 17.10.2019 Mash and Domec Spa have signed an LOI regarding joint offering of pay later solution at POS for merchants acting in Italy.
- 13.9.2019 Mash issued two new bonds, in total EUR 100 million, to expand its funding base.
- 15.8.2019 the Company has published unaudited interim financials for Q2 (as at 30 June 2019) (revenues and EBIT).
- Directed issue of E shares:
- Pursuant to amendment of the Articles of Association and share authorization for issuance of 5,000,000 new E shares approved by the Extraordinary General Meeting of Shareholders on 11 June 2019, the Company’s Board of Directors has on 14 June 2010, 24 June 2019 and 28 June 2019 passed resolutions regarding an issuance of in total 2,010,610 new E-shares against a subscription price of EUR 10 per share, the aggregate subscription price amounting to EUR 20,106,100.00. After payment of the respective subscription prices, the new E shares were registered within the Trade Register on 19 July 2019 and 20 August 2019. Following a due diligence process for a subscription with payment in kind, one subscription of ca EUR 6 million was not approved, which meant the subscription lapsed. This has no effect on previously reported figures.
- The minimum subscription was EUR 500,000 per subscriber (companies in the same group could divide the subscriptions between separate affiliated companies). The subscription price was based on the Board of Director’s estimate of the fair market value of the Company’s new share series, E share, taking into account (i) the subscription price applied in the recent issues of A-shares, including a so-called block subscription discount as the minimum subscription was 5-times higher than what was applied in A-share issues, (ii) the rights and obligations of the E-shares according to the articles of association, (iii) valuations of the Company received in connection with the A-share and C-share issues and (iv) valuations received from independent professional advisors.
- The new shares were offered in deviation from shareholders' pre-emptive subscription rights, to eligible investors and to other parties designated by the Board of Directors identified as potential investors, taking into account the following objectives of the share issue: The share issue is expected to support the growth and operational strategy of the Company. Mash has and will use proceeds from the share issue to fund the business activities of the Company and its subsidiaries in the next development stages through the expansion of service offerings and volume in current and new markets, the continued development of business-enabling systems and maintaining a financial position enabling concurrent increase of external funding. The issue supports the group’s aims to maintain a strong balance sheet and sufficient equity to support development and growth.
- After market enquiries and research, the Board of Directors took the view that only a directed share issue could guarantee the desired amount of subscriptions.
- The Company has been also engaged in discussions with potential strategic partners which resulted in subscriptions of the Company’s E-shares in the share issue.
- Based on the above-mentioned, there was a material financial reason to deviate from the shareholders' pre-emptive subscription right.
- The subscription prices for the shares was recorded to the fund for the invested non-restricted equity.
- Pursuant to amendment of the Articles of Association and share authorization for issuance of 5,000,000 new E shares approved by the Extraordinary General Meeting of Shareholders on 11 June 2019, the Company’s Board of Directors has on 14 June 2010, 24 June 2019 and 28 June 2019 passed resolutions regarding an issuance of in total 2,010,610 new E-shares against a subscription price of EUR 10 per share, the aggregate subscription price amounting to EUR 20,106,100.00. After payment of the respective subscription prices, the new E shares were registered within the Trade Register on 19 July 2019 and 20 August 2019. Following a due diligence process for a subscription with payment in kind, one subscription of ca EUR 6 million was not approved, which meant the subscription lapsed. This has no effect on previously reported figures.
- 7.6.2019 the Board of Directors of Mash has appointed Mr. Gaëtan Van Wynsberghe as Group CEO replacing Mr James Hickson.
- 16.5.2019 the Company has published unaudited interim financials for Q1 (as at 31 March 2019) (revenues and EBIT).
- The Company has entered into a significant cooperation agreement with a Swedish company Tink.
- As announced on 29 March 2019, the Company has repaid a bond of EUR 20 million.