On Monday morning, Banco BV retraced the decision to exercise the call option on the shares issued by Méliuz, leading to the company’s stock value plunging by nearly 9%.
This news was received with surprise given that the execution of the purchase option had previously propelled the company’s stock value skyward.
According to a press release, the bank declared the decision “final and irreversible,”.
This raises questions regarding the alliance formed by Banco BV following their recent commercial merger.
Background of the agreement
Méliuz’s partnership with Banco BV began in late 2022 when the bank acquired 3.85% of the company’s capital.
The interest in Méliuz’s “banking as a service” platform, Bankly, was part of a strategic plan to grow BV’s exposure in the digital finance industry.
This appeared to be a promising first step, allowing both companies to expand jointly. However, recent financial developments may jeopardize these ambitions.
Méliuz reported that Banco BV chose not to exercise the share purchase after a preliminary discussion regarding the terms of the agreement, which allowed BV to purchase Méliuz shares until March 31, 2025.
According to a market update, “the call option ceases to be valid and can no longer be exercised by Banco BV.”
Also, changes were made to the commercial agreement between the parties, including the provision of financial products and services.
The partnership’s governance was impacted by BV’s decision, resulting in a significant rearrangement in Méliuz’s leadership.
Méliuz also said that it terminated the voting agreement submitted in March 2023 with the bank’s investment vehicle BV (FIP BV), resulting in the termination of FIP BV’s rights under the agreement, including the opportunity to appoint a member to Méliuz’s board of directors.
As a result of the termination of the Voting Agreement, the company received the respective letter of resignation from Júlio Cezar Tozzo Mendes Pereira, who until then acted as a director of Méliuz, appointed by FIP BV.
Investor reactions and market sentiments
As a result of the decision, Méliuz plunged to R$3.56, down 9.41% by 11:25 AM (Brasilia time).
Questions about the future of Méliuz, now without the financial and strategic backing of Banco BV, have caused investor caution.
According to analysts at XP Investimentos, who spoke to InfoMoney on the situation, the announcements so far indicate that the issue could be that BV is unable to take better advantage of the customer base obtained in the partnership with Méliuz.
Updates to the commercial agreement
No further details regarding those changes to the commercial agreement had been released, except Méliuz said that there was a reaffirmation of commitment from both parties to a sustainable long-term partnership.
The company in a press release said:
In order to provide greater alignment between the parties, the commercial agreement for the offer of financial products and services was subject to adjustments to certain conditions, with Méliuz and banco BV reaffirming their long-term partnership.
New guidelines for 2025 were negotiated, with the company providing little further detail or indication of the magnitude of these changes.
As a result of this update, we would like to inform shareholders and the market in general that, hypothetically, if the new adjustment to the commercial agreement had been applied to the last reported result, for the third quarter of 2024, the Company would have had a negative impact of approximately R$ 7 million on its consolidated net revenue, the company added.
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