Yeah, I have to open my mouth as well, since I’ve been following this since the early days of the FDA clearance application. The offering ended up being quite successful and the share price has started a slight upward trend. Personally, I have very mixed feelings about the share issue arrangement. On one hand, I try to understand why the FIN-FSA (Finanssivalvonta) decided to grant an exemption from the mandatory tender offer obligation; perhaps it can be justified as being in the best interest of the company. It seems that in this case, as is often the case, securing the company’s operating conditions takes precedence over the interests of minority shareholders. What’s happening now is that the largest owner is able to bypass the tender offer obligation with the blessing of the FIN-FSA. I believe we will soon see a mandatory offer, which will naturally be close to the subscription price and which few will accept. This way, the largest owner can more freely increase their stake further until the next tender offer threshold. This is essentially a textbook corporate cornering. It’s a shame for retail investors because determining the true value of the company is so difficult. Below are two quotes from the company’s announcements regarding the exemption; especially the latter only reinforces my view that the largest owner intends to increase their holding in the future as well.
Quote from the announcement regarding the exemption (March 26):
“The condition for the exemption is that Stephen Industries Inc Oy, Kustaa Poutiainen, or persons acting in concert with them do not acquire or subscribe for more shares in Bioretec or otherwise increase their voting rights in Bioretec after exceeding the tender offer threshold.”
In the flagging notification published on April 28, the same thing is stated in different words:
“Exceeding the 30 percent tender offer threshold does not therefore trigger an obligation for Kustaa Poutiainen or Stephen Industries Inc Oy to make a mandatory public tender offer until Stephen Industries Inc Oy, Kustaa Poutiainen, or persons acting in concert with them acquire or subscribe for more shares in Bioretec or otherwise increase their voting rights in Bioretec.”