Starbreeze’s convertible loan holder formally requests the conversion of the loan

As expected, Digital Bros has now formally requested the conversion of their MSEK 215 loan into B-shares. The number of new shares obtained was lower than anticipated, resulting in a dilution of only 10%. After the conversion, Digital Bros will hold 29.2% of the voting rights and will thus not be required to make a mandatory bid for the remaining outstanding shares.

The new conversion price, adjusted for the rights issue, was set at SEK 1.45 (previously SEK 1.65). This was considerably higher than our estimate and consequently the number of B-shares received (148,311,724) by Digital Bros was lower than our expectations (241,820,040). This conversion will increase the total number of B-shares from 1,076,841,522 to 1,225,153,246, resulting in a dilution of approximately 10% of the total shares and approximately 4% of the total votes after the conversion.

With Digital Bros and other shareholders converting A-shares to B-shares throughout July, along with the completion of the convertible loan conversion, Digital Bros will hold approximately 21.0% of the shares and 29.2% of the votes in Starbreeze. As Digital Bros’ voting share is below the 30% threshold, Digital Bros will not be obliged to make a mandatory bid for the entire company.

With part of the proceeds from the rights issue being utilized by Starbreeze to settle the loan’s renegotiation fee and Digital Bros converting the outstanding loan amount, Starbreeze will now be virtually debt-free. With the convertible loan now taken care of Starbreeze finds itself on a more stable footing heading into the September launch of PAYDAY 3.

*Dilution compared to before the rights issue