June 24, 2018
In the interests of stakeholder transparency, this announcement provides background and context to Viking's file bankruptcy proceedings upon Tecnotree:
As many of you will now know, Viking Corp was recently forced to file bankruptcy proceedings upon Tecnotree, which were withdrawn on the 19 June. In the interests of stakeholder transparency, we make this Announcement to provide background and context to this action.
Firstly, we would reflect on the recent history of our attempts to partner with Tecnotree and all its stakeholders. Viking launched a Tender Offer (TO), having conducted detailed discussions with the Tecnotree Board and our advisors. On the basis of those discussions, we were very confident that the TO price of 10 cents per share provided truly superior value for shareholders. So did the Tecnotree Board as evidenced by their unanimous recommendation of our Offer and of course, further evidenced by the current prevailing market price.
This TO was supported in the most vigorous manner, including an extensive PR campaign to demonstrate the benefits of our Offer, intensive buying in the open market, and outreach to shareholders. Despite all this, our TO did not reach its goal of acquiring 90% of the issued equity in Tecnotree.
Following the TO, Viking then sought to have a collaborative partnership with Tecnotree and its Board. The Board unanimously recommended that two Viking executives join the Tecnotree Board, and we saw that as a key platform to jointly formulate a solution for the critical situation that Tecnotree faced (as detailed in the public announcements they had made). Sadly, we were denied this chance of collaboration and partnership at the recent AGM, and were not elected to the Board.
Given this situation, we naturally sought to protect the value of our debt and equity position in Tecnotree (being both Tecnotree’s largest debt and shareholder). A formal demand for overdue debt and penalty interest payments of EUR 645,530 was served, with the legally validated timescales for payment clearly detailed. The alternative of facing bankruptcy proceedings was also clearly detailed. No payment, or indeed any response, was received during the time scales allowed and therefore, Viking saw little alternative other than to go ahead and invoke bankruptcy proceedings. The day after we did so, we received payment from Tecnotree and promptly withdrew our filing.
However, it is sad that it takes the filing of bankruptcy to gain overdue payments of these relatively small amounts that were originally due under the restructuring plan in 2017. Given these events (which are now a matter of public record), together with the public disclosures made by Tecnotree themselves, our certain fear is that Tecnotree’s financial disposition is in the most critical condition. We also note that further payments under the restructuring plan are due on 30 June 2018.
Given this immediate concern, and as Tecnotree’s largest debt and shareholder, we intend to make a final offer to the Tecnotree Board and will use our right to call for an EGM to have this discussed and voted if necessary. Based on the events and information, which are now public record, we firmly believe this will represent a last chance to find a working solution for most of Tecnotree’s ecosystem; particularly the welfare of its customers, software IP and other assets.