Shares of Bidstack Group took a nosedive in early trading, plummeting by as much as 73%. The company announced that it currently has sufficient cash to sustain operations until the end of March but will require additional working capital in the short term.
At 1232 GMT, shares were down by 0.33 pence or 60%, reaching a low of 0.15 pence earlier in the session. This marks an overall decrease of 88% over the past 12 months.
Bidstack Group, known for its in-game advertising, revealed that Irdeto, one of its shareholders, has not yet obtained the necessary disclosures and documentation from parent company Multichoice Group for a loan agreed upon in October. As a result, Bidstack has been forced to explore alternative options and has initiated a strategic review of the business, including the potential sale of its assets.
The loan in question amounts to £2.4 million ($3 million) in addition to a share subscription agreement with Irdeto, who currently owns 13.49% of Bidstack’s issued share capital.
However, the loan was subject to several conditions, including shareholder approval and a waiver of Rule 9 imposed by the U.K. Takeover Panel. This rule mandates that any entity possessing over 30% of issued share capital must launch a mandatory takeover bid.
As of January 31, Bidstack declared that it had £1.4 million in cash reserves.