Following the transaction, we understand that Strax will be the minority holder of 40% of a new joint venture with Matter Brands. Matter Brands will be the partner to scale up Strax brands in North America more efficiently. We understand that the new joint venture is expected to be self-funded.

After the divestment, Strax will focus on three main topics:

In December 2023, Strax sold Urbanista to Proventus Capital Partners, the lender of its debt. After the transaction, Strax has an outstanding loan of EUR11.5m to Proventus Capital Partners (PCP). We believe the next 3-6 months will be crucial for Strax as the company needs to manage its debt. According to the management, they have a very good dialogue and cooperation with PCP. But if PCP decides to call the debt, Strax needs to be refinanced, and it might be difficult to raise new capital or get a bank loan.

In a rosy scenario, Strax can get the sales going for Clckr, develop Planet Buddies further, and launch Strax Health in North America. And in the meantime, continue to reduce the debt burden to more manageable levels.

Redeye will place Strax under review due to the high uncertainty in the near term. We will follow the development closely, and have a continuous conversation with the management. We hope to get some additional information regarding the company's strategy going forward before we can reassess the case and update the valuation range. But as of now, we will not publish any valuation range for Strax.