Blockchain solutions provider DigitalX seeks to slash costs via Minority Holder Sale
Through the minority holder sale, DigitalX hopes to cut the administrative costs associated with maintaining a large number of very small holdings.
Australian Blockchain technology company DigitalX Ltd (ASX:DCC) is seeking to reduce costs stemming from maintaining a grand number of small shareholdings.
In a filing with the ASX, the company has unveiled its plans to conduct a minority holder share sale of parcels of shares with a market value of less than $500. Let’s note that a “marketable parcel” is a parcel of shares with a market value of not less than $500.
DigitalX notes that it “values all its shareholders, however it incurs significant administration costs maintaining such a large number of less than marketable parcels of shares”.
If recipients of the Minority Holder Notice wish to sell their shares through the Minority Holder Sale, they do not need to take any action. If Minority Holders do not wish to sell their shares through this sale, they must complete a form and send it to the Company’s share registry by the Retention date (September 29, 2017).
The amount received by a Minority Holder from the sale will be determined once all the shares under the Minority Holder Sale are sold.
In June this year, DigitalX entered into a conditional agreement with Blockchain Global Limited according to which Blockchain Global agreed to invest about $4.35 million at 2.7 cents a share to acquire an interest in approximately 40% of the company on a fully diluted basis, with the right to procure investors for 50% of its investment commitment.
Under the terms of the agreement, DigitalX has received AUD 300,000 by way of a convertible loan in Bitcoin. This is the first time such funding is secured by a company listed on ASX. Blockchain Global will subscribe for or procure subscribers for shares, convertible notes and options in DigitalX for up to further AUD 4.05 million. It will also have the right to appoint two directors to the DigitalX board.
Later in June, DigitalX confirmed that it had received notification from Blockchain Global about the completion of due diligence investigations on DigitalX and that the results are satisfactory. This condition is now met. Also, Blockchain Global has also advised that the conditions related to an agreed use of funds budget and third-party approvals have been satisfied.