Current Report 05/2022
26/04/2022 • 11:44
Subject:
Disclosure of delayed inside information – commencement by a subsidiary of negotiations concerning the acquisition of shares in UAB Mlr grupe [“MailerLite”]. Conclusion by a subsidiary of a conditional agreement for the sale of shares in MailerLite and in s
Legal basis:
Art. 17 sec. 1 MAR – inside information.
Content:
The Management Board of R22 S.A. with its registered office in Poznań [“Issuer”] announces that: i] on 24 February 2022 it decided to delay disclosure of inside information concerning the commencement by the Issuer and its subsidiary Vercom spółka akcyjna with its registered office in Poznań [Vercom] of negotiations regarding the conclusion of an agreement for Vercom to acquire shares in UAB Mlr grupe [“MailerLite”] and its subsidiaries with registered offices in the United States and Ireland [First Inside Information], and ii] on 29 March 2022 it decided to delay disclosure of inside information concerning the commencement by the Issuer and Vercom of negotiations regarding Vercom’s acquisition from the Issuer of 100% of the shares in Oxylion spółka akcyjna [Second Inside Information] – pursuant to Article 17(4) of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC.
The reason for disclosure of the delayed First Inside Information is the completion of negotiations and conclusion today [i.e. 26 April 2022] of a conditional share sale agreement between Vercom [as buyer] and, among others, Itema Ventures, UAB with its registered office in Vilnius [“Itema”] and Mr Gediminas Andrijaitis [hereinafter jointly referred to as the “Sellers”] [as sellers] [“SPA”], pursuant to which, subject to satisfaction of the conditions precedent specified in the SPA: [a] the Sellers undertook to sell 65% of the shares in the share capital of MailerLite [hereinafter the shares referred to as the “Sale Shares”] and 100% of the shares in selected subsidiaries belonging to the MailerLite group, in particular: [i] MailerCheck, Inc. with its registered office in Delaware [USA], [ii] MailerSend, Inc. with its registered office in Delaware [USA], [iii] MailerLite Limited with its registered office in Dublin [Ireland], [iv] MailerLite, Inc. with its registered office in Delaware [USA] [hereinafter jointly referred to as the “Subsidiaries”], and [b] Itema undertook to contribute 35% of the shares in the share capital of MailerLite as a non-cash contribution [contribution in kind] to cover shares in the share capital of Vercom to be subscribed for by Itema in the increased share capital of Vercom [“Contribution Shares”].
The total transaction value was set at EUR 84.132.000,00 [eighty-four million one hundred thirty-two million euros 0/100], comprising: [a] the total price payable to the Sellers for the sale of the Sale Shares, set at EUR 54.150.000,00 [fifty-four million one hundred fifty thousand euros 0/100], and [b] the total issue price payable for the Vercom shares to be subscribed for by Itema in the increased share capital of Vercom and paid for in the form of the non-cash contribution [contribution in kind] of the Contribution Shares, set at EUR 29.982.000,00 [twenty-nine million nine hundred eighty-two thousand euros 00/100]. Completion of the transaction contemplated by the SPA was made conditional upon satisfaction of the following conditions precedent: [a] transfer of specified employees and contractors and specified assets of The Remote Company Inc. with its registered office in Delaware to MailerLite, Inc. with its registered office in Delaware [one of the Subsidiaries], and transfer of employees and contractors and specified assets of UAB Itema and UAB Trc technologijos with its registered office in Mindaugo to MailerLite; and [b] preparation of a valuation of intellectual property owned by MailerLite, Inc. with its registered office in Delaware by an entity jointly selected by Itema and Vercom.
MailerLite is a global provider of email communication tools for business customers for sending transactional and marketing messages, as well as email list verification. MailerLite’s main markets are the United States and Western Europe, which together account for more than 70% of the company’s revenue. MailerLite has more than 38 thousand business customers in 180 markets and employs approximately 100 employees in 30 locations across different time zones. Over the last three years, MailerLite’s average annual revenue growth was 43%.
The SPA governs the principles of managing MailerLite during the transitional period from signing until completion of the transaction. Potential risks associated with the transaction have been secured by appropriate contractual penalties, indemnification clauses and representations and warranties made by the Sellers, and the procedure for pursuing claims in the event that such representations prove untrue has been specified in detail in the SPA. In addition, the SPA establishes a non-compete obligation for the Sellers, limited in time to a maximum of 3 years [with respect to Itema and Itema’s shareholders] and 2 years [with respect to Mr Gediminas Andrijaitis].
In addition, the SPA contains contractual penalties reserved for the benefit of Itema and payable by Vercom, in particular in the event that the increase in Vercom’s share capital [on the terms indicated herein] is not registered due to circumstances attributable to Vercom.
Pursuant to the SPA, Vercom has the right to withdraw from the SPA if: [a] the Sellers fail to perform the closing actions specified in the SPA, [b] there is a material deterioration in MailerLite’s financial results; [c] the Sellers fail to satisfy the conditions precedent by 1 July 2022; [d] events disclosed in the disclosure letter delivered to Vercom occur and result in damage of at least EUR 3.000.000; [e] fundamental representations made by the Sellers are breached, as disclosed in the disclosure letter delivered to Vercom.
Pursuant to the SPA, the Sellers have the right to withdraw from the SPA if: [a] the price payable to the Sellers for the Sale Shares is not paid, [b] Vercom fails to perform the closing actions specified in the SPA, [c] the Sellers fail to satisfy the conditions precedent by 1 July 2022.
The acquisition of the Sale Shares will be financed from Vercom’s own funds originating from the public offering of Vercom shares conducted in 2021 [approximately EUR 28,13 million] and from bank financing [approximately EUR 26 million].
The reason for disclosure of the delayed Second Inside Information is the completion of negotiations and conclusion today [i.e. 26 April 2022] by the Issuer and Vercom of an agreement concerning the terms of acquisition of Oxylion S.A. [“Agreement”]. Pursuant to the Agreement, the parties undertook to conclude an agreement for the transfer of 100% of the shares in Oxylion S.A. by the Issuer to Vercom as a non-cash contribution [contribution in kind] to cover shares in the share capital of Vercom to be subscribed for by the Issuer in the increased share capital of Vercom.
The total issue price payable for the Vercom shares to be subscribed for by the Issuer in the increased share capital of Vercom and paid for in the form of the non-cash contribution [contribution in kind] comprising Oxylion S.A. was set at an amount not lower than PLN 36.419.200,00 [thirty-six million four hundred nineteen thousand two hundred zlotys 00/100].
The Agreement also provides that the Issuer will subscribe for shares in the increased share capital of Vercom to be paid for by a cash contribution of PLN 8.000.045,00 [eight million forty-five zlotys 00/100]. This amount will be used to repay Oxylion S.A.’s debt to the Issuer.
Oxylion S.A. operates in telecommunications market segments that are attractive to Vercom in the context of its global expansion strategy. In particular, the company offers a broad range of advanced cloud telephony [VoIP] services, including contact centre management, mass communication through voice campaigns, virtual IP-PBX, call recording, virtual fax and conference calls. The services can be integrated with numerous IT systems [CRM, ERP, etc.] and are currently sold mainly to resellers, integrators and business customers.