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Huddlestock Fintech

M&A Activity Jul 5, 2022

3624_rns_2022-07-05_ac4f86db-95a9-4b07-94c5-289b841aa7c6.html

M&A Activity

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Huddlestock Fintech AS (OSE: HUDL) acquires Trac Services and Tracs Technology. Obtains a full investment banking license.

Huddlestock Fintech AS (OSE: HUDL) acquires Trac Services and Tracs Technology. Obtains a full investment banking license.

5.7.2022 08:00:00 CEST | Huddlestock Fintech AS | Additional regulated

information required to be disclosed under the laws of a member state

With reference to the stock exchange announcement made 12.05.2022, Huddlestock

Fintech AS ("Huddlestock"), a provider of innovative technology solutions to the

capital markets, treasury, and wealth management industries, is pleased to

announce that a final and binding agreement to acquire 100% of the shares of

Trac Services AS and Tracs Technology AS (the "Shares" and/or "Tracs"), as well

as their regulatory licenses, has been signed.

The highly complementary acquisition adds a fully operational service

organisation, regulatory licenses, financial technology and suite of

complementary wealth management products to Huddlestock's existing portfolio. As

of end 2021, Tracs had NOK 4bn in assets under management and delivered NOK

14.1m in annual recurring revenues. Together with this acquisition, eight highly

specialised and committed employees will join Huddlestock from Tracs', taking

the total number of employees in Huddlestock to 70 people. Huddlestock's

management see significant opportunities to scale and increase the new groups´

revenue base and margins. The combined group's 2022 revenue target of NOK 75m is

maintained.

"This is yet another milestone for the company and shows that we deliver on our

goals and targets. We are now a fully licensed investment banking group with

extended capabilities, just like we said we would achieve in our last funding

round in December 2021. Our annual recurring revenues are expected to increase

by NOK 14.1m this year alone due to this transaction. The integration of Tracs'

highly skilled employees and purchase of additional shares by the Njord Group, a

respected institutional investor, shows the faith owners and managers put in our

capabilities to build a solid and valuable business," says John E. Skajem, CEO

of Huddlestock.

"There are strong synergies between Huddlestock and Tracs. We see significant

client opportunities for increasing revenues and margins, opening up for rapid

expansion of the business. The combination of Huddlestock and Tracs, will create

one of the largest B2B Fintech providers in Europe. As institutional and

long-term investors, we strongly believe in the value proposition of

Huddlestock, and see a profitable future together," says Jan Sigurd Vigmostad,

Chairman of Trac Services AS and Tracs Technology AS.

The final agreement has the following main content:

* Huddlestock will on Closing issue 12,732,819 shares, in whole or in part

potentially substituted with treasury shares, as consideration for the

acquired Shares ("Consideration Shares");

* In the event the consolidated revenue for Huddlestock is equal to or exceeds

NOK 100m with an EBITDA margin equal to or exceeding 5% for the financial

year 2023, the Sellers are entitled to an additional 4,375,539 shares of

Huddlestock to be issued in a private placement ("Earn Out Shares");

* Both the Consideration Shares and the Earn Out Shares will be subject to a

12-month Lock-up arrangement from the date of issuance;

* A condition precedent for the Sellers is that Njord, through the support of

other shareholders in the Buyer, is successful in appointing two Board

Members of the Buyer on Closing.

In a separate part, Njord Group AS ("Njord") has agreed to purchase an

additional 1,923,077 shares in Huddlestock Fintech at a price of NOK 2,60 per

share, and a total consideration of NOK 5,000,000 ("Private Placement Shares")

on the close of Huddlestock´s acquisition of Trac Services and Tracs Technology.

The shares will be issued to Njord in a private placement and takes Njord's

total shareholding in Huddlestock post-close to 8.80%.

As a holder of licenses regulated by the Norwegian FSA and held under the

Norwegian Securities Act, Huddlestock's proposed acquisition of Trac Services

AS, triggers a change of ownership clause. The agreement to purchase Trac

Services AS and Tracs Technology AS is subject to approval from Finanstilsynet

(Norwegian FSA).

DISCLOSURE REGULATION

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.

CONTACTS

* Cecilia Luras, Director of Strategy & Investor Relations, +47 951 45 382,

[email protected]

* John E. Skajem, CEO, +47 418 87 412, [email protected]

ABOUT HUDDLESTOCK FINTECH AS

Huddlestock Fintech is an innovative technology software provider with a leading

expert professional services business. We deliver innovative and sustainable

technology solutions to the capital markets, treasury and wealth management

industries.

Through its technology offering, Huddlestock offers an innovative, compliant,

and data-centric WealthTech SaaS, accelerating the digital transformation, and

trends of hyper-personalization and on-demand banking within the wealth

management industry. Huddlestock's SaaS empowers the embedding of low-cost,

efficient white-label trading and investment services, underpinning

Huddlestock's mission of delivering financial inclusion by democratizing access

to capital markets.

Through its world-class expert professional services business, Huddlestock

delivers strategic technology solutions and process automation for the financial

services industry. This range of services has propelled Huddlestock into

becoming the preferred supplier of financial consultancy services and technology

solutions in the Nordic region. Huddlestock Fintech AS was listed on Euronext

Growth Market 26th November 2020, as Norway's first fintech company to be

publicly traded.

For more information, please visit www.huddlestock.com -

http://www.huddlestock.com/

ATTACHMENTS

Download announcement as PDF.pdf -

https://kommunikasjon.ntb.no/ir-files/17848032/1599/2168/Download%20announcement

%20as%20PDF.pdf

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