Mobly’s Tok&Stok Deal: Capital Boost and First-Ever Debenture Offering

Mobly (MBLY3) has taken a significant step in its acquisition of Tok&Stok. The company’s board of directors approved a capital increase of up to R$ 230.6 million ($41.2 million) on Thursday.

The furniture retailer plans to issue between 13.6 million and 56.2 million new shares. Each share will be priced at R$ 4.08, which is 91.5% higher than the closing price on Thursday.

In addition to the capital increase, Mobly will make its first debenture issuance. The company will offer a single series of debt securities for private placement. The minimum subscription is R$ 100 million ($17.9 million) and the maximum is R$ 500 million ($89.3 million).

These financial moves are part of Mobly’s agreement to acquire control of Tok&Stok, which was announced in August. The deal has been in negotiation for several years.

Mobly previously stated it would increase capital to incorporate 60.1% of Tok&Stok’s capital held by SPX Capital-managed funds. The company also planned to issue debentures to its shareholders and Tok&Stok’s controlling affiliates.

The debentures are convertible, giving holders the right to subscribe to additional Mobly common shares. However, there is a 24-month lock-up period. During this time, Mobly’s current controlling shareholders, founders, and SPX-managed funds commit to holding their shares.

Mobly’s Tok&Stok Deal: Capital Boost and First-Ever Debenture Offering

With control of Tok&Stok, Mobly will now have 70 stores and an annual revenue of R$ 1.6 billion ($285.7 million). This makes it one of the largest specialized furniture retail chains in Brazil.

The current management expects to gradually increase cash generation. They anticipate an additional annual increase of R$ 80 million to R$ 135 million ($14.3 million to $24.1 million) over five years.

This acquisition marks a significant expansion for Mobly in the Brazilian furniture market. It demonstrates the company’s commitment to growth and its confidence in the sector’s potential.

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