The restructuring plan of Elmo Rent AS was accepted by the creditors
On February 6, 2024, Elmo Rent AS presented its creditors with a restructuring plan for approval, which could be voted on until February 20, 2024.
The creditors were divided into four different groups, with group I being third parties, groups II and IV involving claims related to the largest shareholders, and group III consisting of claims from Elmo Rent AS's subsidiaries. For the restructuring plan to be accepted, according to the restructuring law, at least 50% of the creditors in each group, owning at least two-thirds of all votes, had to vote in favor.
In total, 82.4% of the eligible creditors across all groups voted in favor of the plan. In group I, 74.1% of the creditors voted for the adoption of the plan, 19.9% voted against, and 6.0% of group I creditors abstained from voting. Groups II-IV voted 100% in favor of the restructuring plan.
"We have faced several setbacks in the last 1.5 years, but we have steadfastly stuck to our path, achieved many goals, and adapted accordingly. Deep bows to all creditors for accepting the well-prepared restructuring plan in cooperation with the restructuring advisor in the current situation and the surrounding macroeconomic climate, and for continuing to invest in Elmo," said Enn Laansoo, Jr., a board member of Elmo Rent AS.
The aim of the Elmo Rent AS restructuring process is to overcome the company's temporary financial difficulties. During this process, various restructuring measures will be implemented, supporting the business direction of short-term rental in finding a business partner and continuing the development of promising technology at the subsidiary (Elmo Remote OÜ) and attracting new investors. The restructuring plan restructures and divides the obligations of 178 creditors into four groups, totaling €3,319,857.98.
The principal and interest claims of creditors in groups I and IV are reduced by 15%, and penalty claims are reduced by 100%, with a payment holiday until December 2024. The claims of creditors in group II are similarly restructured but are subordinated to the payment of claims of group I creditors (i.e., paid after the obligations taken before group I creditors are fulfilled by the company). The restructured claims will be paid in 36 equal monthly installments starting from January 30, 2025, until December 30, 2027. The claims of group III creditors, i.e., the subsidiaries' principal, interest, and penalty claims, are reduced by 100%.
Following the approval of the restructuring plan, changes in the company's board and council will be finalized. Peeter Raudsepp and Margot Roose will step down from the council, and a proposal will be made to the general meeting to elect Enn Laansoo, Jr., the current board member, to the council instead of Priit Haljak. Priit Haljak will then be elected to the board, essentially swapping roles with the company's leaders.
"Under Enn's leadership and in our collaboration, Elmo has become one of the world's top players in the field of teledriving technology installed in passenger vehicles. It has been used to cover thousands of remotely controlled kilometers in various countries and continents, including providing real service. In the council, Enn will continue to contribute to our vision of evolving into a global technology company and attracting investments. As a board member, I will continue with technology development and be responsible for the efficient implementation of the restructuring plan," said Priit Haljak, the second-largest shareholder and council member.
"One of Elmo's strengths is the diverse expertise and experience of the largest shareholders, where we can now apply Priit's long-term international management experience, which further increases the success of the restructuring plan," added Laansoo, Jr.
From the perspective of an Elmo Rent AS shareholder, the total claims are reduced by €727,052.28 (including the deletion of subsidiaries' claims amounting to €283,792.41). The company continues to offer rental services with environmentally friendly cars, which has largely been restructured (reduced unprofitable cars, staff, and focused on long-term rental during the low season) and is searching for a business partner. Through the subsidiary, teledriving technology development continues, the first customer contracts are fulfilled, and efforts to attract investors to the subsidiary persist.
More information:
Enn Laansoo, Jr.
Member of the Board
Elmo Rent AS
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