16 April 2023

Potential corporate conflit around Kernel WSE delisting gains momentum.

As a reminder, the largest shareholder of Kernel, Namsen Limited, which belongs to the founder of the company Andriy Verevsky, has sent a formal letter in which it is proposed to delist Kernel from the Warsaw Stock Exchange. Verevskyi proposes to buy back their shares in Kernel from the minority shareholders and make the company private.

The proposed buyout price is PLN 18.5 per share (which means the total value of the company at the level of about $365 million).

Shortly thereafter, Namsen announced a formal tender to buy back the shares at the stated price.

On April 13, in its message on the website of the Warsaw Stock Exchange, Kernel reported that the Board of Directors of Kernel supported the buyout of shares. Baker Tilly company was asked to do an analysis of the buyout price fairness.

As a result of the analysis, in its report Baker Tilly said the quoted price is near the lower end of the fair price range for Kernel shares.

On the other hand, also on April 13, in another message on the website of the Warsaw stock exchange, Kernel indicated that several of the company's shareholders (mostly pension and investment funds, as well as insurance companies that in total own a 21.59% stake in Kernel) concluded an agreement to protect their interests in the process of the proposed delisting.

Among the companies that concluded the agreement are quite significant Polish investors, such as Uniqa, PZU, Allianz Polska, Kopernik Global Investors LLC, the Danish Lind Value, and others.

It may be noted that most of these companies are quite long-time Kernel shareholders and have not sold their shares since the start of the full-scale Russian invasion, so they are unlikely to be interested in selling their shares at the proposed price.

In their appeal, the minority shareholders note that they are ready to take appropriate actions within the framework of the legal field to protect their interests in the current situation.