REG - Wise PLC - Statement pursuant to s 314 of the Companies Act

WiseAnnouncement

21/07/2025 07:10

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RNS Number : 8314R  Wise PLC  21 July 2025

 

 

 

21 July 2025

Statement circulated pursuant to section 314 of the Companies Act 2006 and

response from the Board of Wise plc

 

 

Wise plc has received a statement from Skaala Investments OÜ pursuant to
section 314(1) of the UK Companies Act 2006. That statement, together with the
Board's response, is set out in full below.

 

The Board considers the dual listing proposal to be in the best interests of
Wise and Wise Owners and unanimously recommends that Wise Owners vote in
favour of the scheme and each related special resolution as each Director
intends to do in respect of their own holdings.

 

Expected timetable of principal events

 

The timetable for the shareholder meetings remains unchanged and is set out
below for reference.

 

 Event                                                                          Time and Date
 Latest time for lodging Forms of Proxy for Class A Share Court Meeting (BLUE   4.00 p.m. on 24 July 2025
 form)
 Latest time for lodging Forms of Proxy for Class B Share Court Meeting (GREEN  4.15 p.m. on 24 July 2025
 form)
 Latest time for lodging Forms of Proxy for Extraordinary General Meeting       4.30 p.m. on 24 July 2025
 (WHITE form)
 Voting Record Time for the Court Meetings and Extraordinary General Meeting    6.30 p.m. on 24 July 2025
 Class A Share Court Meeting                                                    4.00 p.m. on 28 July 2025
 Class B Share Court Meeting                                                    4.15 p.m. on 28 July 2025
 Extraordinary General Meeting                                                  4.30 p.m. on 28 July 2025

 

For more information on the timetable, please consult the Scheme Circular.
Subject to the satisfaction or (where applicable) waiver of the Conditions,
the Scheme is expected to become effective in Q2 2026.

 

Enquiries

Martin Adams - Owner Relations

owners@wise.com

Sana Rahman - Communications

press@wise.com

Brunswick Group

Charles Pretzlik / Nick Beswick
Wise@brunswickgroup.com (mailto:Wise@brunswickgroup.com)

+44 (0) 20 7404 5959

About Wise

Wise is a global technology company, building the best way to move and manage
the world's money.

With Wise Account and Wise Business, people and businesses can hold 40
currencies, move money between countries and spend money abroad. Large
companies and banks use Wise technology too; an entirely new network for the
world's money. Launched in 2011, Wise is one of the world's fastest growing,
profitable tech companies.

In fiscal year 2025, Wise supported around 15.6 million people and businesses,
processing over $185 billion in cross-border transactions and saving customers
around $2.6 billion.

IMPORTANT NOTICE

The contents of this announcement have been prepared by and are the sole
responsibility of Wise. This announcement does not constitute or form part of,
and should not be construed as, any offer for sale or subscription of, or
solicitation of any offer to buy or subscribe for, any securities in Wise or
securities in any other entity, in any jurisdiction, nor shall it, or any part
of it, or the fact of its distribution, form the basis of, or be relied on in
connection with, any contract or investment decision whatsoever, in any
jurisdiction. This announcement does not constitute a recommendation regarding
any securities.

 

_________________________________________________________________________________

 

 

Statement from the Board of Wise plc

 

Dear Wise Shareholders (our Owners),

 

On 3 July 2025, Wise plc ("Wise") published a scheme circular in relation to
the proposal (the "Proposal") for a reorganisation which would result in Wise
Group plc ("Wise Holdco"), a Jersey incorporated and solely UK tax resident
company, becoming the ultimate parent company of Wise plc and its
subsidiaries, together with a primary listing of Wise Holdco on a US stock
exchange and secondary listing on the London Stock Exchange.

 

We have received a statement (in full below) from Skaala Investments OÜ
(previously known as Notorious OÜ), an investment vehicle beneficially owned
by Mr Hinrikus, a shareholder and former Chair of Wise. Pursuant to section
314(1) of the UK Companies Act 2006 (the "Act") Skaala has asked Wise to
circulate it to all Owners. Mr Hinrikus helped co-found Wise and was an
important part of our early years. While he has not played a role in Wise's
operations and management since leaving the business in December 2021, he is a
5.1% shareholder of Wise.

 

As it does with all shareholders, the Board takes Mr Hinrikus's views
seriously. We disagree, however, with his view of the Proposal, which we are
confident would bring a number of strategic and capital markets benefits to
Wise and its Owners, including greater visibility in the US, the biggest
market opportunity for our products today, and better access to the world's
deepest and most liquid capital market. The Board, which is majority
independent, strongly believes that the US listing is an important strategic
step for Wise to further advance our mission and, in combination with the
listing, the dual-class share structure is essential to ensuring our continued
successful performance and safeguarding our focus on executing our strategy.

 

Since the circular was published, members of our leadership team have
continued to engage with our Owners, and we are very pleased by the level of
support we have received to date for our Proposal.

 

The Board has openly and meaningfully engaged with Mr Hinrikus, having regard
for his long history with Wise. We are disappointed that, despite this
engagement, he has chosen to proceed in this way.

 

We believe the Board's Proposal is in the long-term interests of Wise and our
Owners, and we have responded in detail to each of the points that Mr Hinrikus
has raised below:

 

Our 2021 direct listing

Mr Hinrikus's statement refers to our direct listing in 2021. We are proud
that we were the first technology company on the London Stock Exchange to list
publicly in this way. In comparison to a traditional initial public offering,
a direct listing was a fairer, cheaper and more transparent way for Wise to
broaden our ownership.

 

The Board, led at the time by Mr Hinrikus as Chair, fully endorsed the
dual-class share structure as an integral part of our direct listing. As
outlined in our 2021 prospectus, this structure helps us focus relentlessly on
solving the problems facing our customers and build a sustainable and
profitable business over the long term.

 

The documents describing the listing and its structure were required to
reflect the company and its strategy at that point in time. The governing
documents of companies can be updated, with approval by shareholders, to align
with the changing strategic and commercial objectives of the company. The
Proposal is now asking shareholders to approve certain such changes.

 

In July 2024, the Financial Conduct Authority (FCA) introduced reforms to the
UK listing regime that included changes to allow investors to hold shares with
weighted voting rights indefinitely with no sunset for individuals and up to
ten years from listing for institutions. Following these reforms, the Board
reviewed Wise's listing arrangements, including consulting with shareholders,
to determine the optimal arrangements for Wise.

 

Upon concluding the review, we announced our Proposal to establish Wise Holdco
as our new holding company and move our primary listing to the US with a
secondary listing in the UK. As explained clearly upfront and throughout the
circular, Wise Holdco would have a dual-class share structure in line with
many of our US-listed tech peers. The structure for Wise Holdco includes a
10-year sunset for when the weighted voting rights would cease to apply. This
10-year period would commence when Wise Holdco became the new holding company
for the group.

 

Clear and upfront disclosure

As a public company, Wise is required to disclose material information in a
timely and transparent manner to the market, and is generally not permitted to
widely disclose material information to some but not all shareholders, as Mr
Hinrikus is suggesting we should have done before publishing the circular.

 

This is why the circular sets out the Proposal in full for all Owners at the
same time for their consideration. This includes a detailed explanation of the
dual-class share structure with a 10-year sunset in the Chair's letter, which
is the first substantive section of the circular (specifically, paragraph 3 on
page 10 of 98), following the standard legal and administrative disclosures
(pages 1-7).

 

Similarly, the letter from the CEO and leaders of Wise, which is the second
substantive section of the circular, also details the long-term vision for the
company and how the dual-class structure supports this vision.

 

We proactively engaged with thousands of our Owners to discuss the structure,
rationale and voting process. We held a webinar so that every shareholder had
an opportunity to hear from management, with our CFO and Head of Owner
Relations outlining the key elements of the Proposal, including the dual-class
share structure.

 

We worked closely with our advisors to ensure the rationale for our Proposal
was supported by factual evidence and precedent. The statement that the
structure aligns with US market practices, including many of our US-listed
tech peers, is underpinned and was verified by data.

 

Ensuring shareholder democracy

We have put forward to shareholders the Proposal that we strongly believe
would further accelerate our mission of money without borders and maximise
value for our Owners as we progress to moving trillions.

 

With extensive input from our advisors, we put forward a fair and equitable
shareholder approval process, following the principle of 'one share, one
vote'. The scheme of arrangement must be approved by Wise's Class A and Class
B shareholders separately, with separate shareholder meetings for each class.
Within each class, that approval must be of a majority in number of
shareholders voting as well as a 75% so-called 'super majority' in value of
shares voted. This system ensures that the voting power of Class A
shareholders is preserved on key matters to be effected by way of a scheme.

 

The scheme of arrangement that we have put forward to Owners is a statutory
process involving a vote on a single proposal. That proposal may relate to
multiple corporate and associated changes to a company's structure. Therefore,
applying concepts of 'unbundling' specific aspects of a scheme into separate
shareholder votes misrepresents how a scheme of arrangement operates legally
and in practice to achieve the Proposal. Schemes are market standard in the UK
and we note that Ashtead Group plc and CRH plc implemented their US listings
similarly.

 

The benefits of multi-class share structures

Companies with multi-class share structures have long been a feature of the US
market. We noted in our circular that "US-listed companies with dual or
multi-class share structures often outperform those with a single share class
in both the short and medium term." This was from a recent 2024 study
published in the Harvard Law School Forum on Corporate Governance.‌ In the
UK, we welcomed the listing rule reforms by the FCA to permit multi-class
structures and also note European success stories including similar structures
in their listing plans.

 

To date, our Owners have been overwhelmingly in favour of the Proposal. We're
also pleased that the key independent proxy advisory firms (ISS, Glass Lewis
and PIRC) have come out unanimously in favour of the Proposal and recommend
shareholders vote for it.

 

We encourage all shareholders to carefully consider the Proposal and related
materials on our Owners website at wise.com/owners (https://wise.com/owners/)
and cast their vote accordingly.

 

The Board considers the Proposal to be in the best interests of Wise and Wise
Owners and unanimously recommends that Wise Owners vote in favour of the
scheme and each related special resolution as each Director intends to do in
respect of their own holdings.

 

Yours faithfully,

 

David Wells, on behalf of the Board of Wise plc

Chair

 

 

 

__________________________________________________________________________________________

 

 

 

 

Statement from Skaala Investments OÜ

 

Dear fellow owners of Wise PLC,

 

We are a significant shareholder in Wise Plc ("Wise" or the "Company"),
holding 52,481,199 Class A Shares and 33,466,926 Class B Shares. With Taavet
Hinrikus, the ultimate beneficial owner of Skaala having co-founded Wise, we
remain firm supporters of Wise's business model, growth potential and talented
leadership team. However, we are deeply troubled by the recommendations
contained in the Company's Scheme Circular, dated 3 July 2025, specifically
the bundling of resolutions relating to dual-class shareholdings with
resolutions to approve dual-listing of the Company on which shareholders are
being asked to vote at meetings on 28 July 2025.

 

Background

 

Transparency and trust have always been at the heart of Wise's business. The
Listing Prospectus in 2021 committed to "become public in a way that is
transparent and fair" and the slogan "radical transparency" features
prominently in Wise's marketing materials. They have been key in winning
customer trust and investor support.

 

At the 2021 Initial Public Offering, a dual-class shareholding structure was
introduced, granting approximately 90.63% of voting rights to Class B
Shareholders. Shareholders were expressly promised that any Class B Shares
enhanced voting rights would cease in July 2026.

 

However, the Scheme Circular now asks shareholders to approve not only Wise's
primary listing move to a US exchange but also - buried in the proposal - a
10-year extension to the Class B Share voting rights, resulting in a total
sunset period of 15 years from IPO on the London Stock Exchange. This
extension significantly exceeds standard practice, typically capped at 5-7
years post-IPO.

 

Notwithstanding that we hold 15.5% of Class B Shares in Wise (and would thus
be a beneficiary of this extension), we are concerned about its impact on the
future value of the Company, its reputation and on the wider shareholder body.
We are aware that a number of other investors share this view and are
supportive of our position.

 

Lack of transparency

 

The Company was aware ahead of publication of the Scheme Circular of our views
on separating resolutions on any sunset period from the dual-listing, and the
approach subsequently taken should have been socialised widely with
shareholders ahead of making matters public. We further raised our concerns
with the directors on 16 July and have received no satisfactory response.

 

The Scheme Circular notably emphasises the dual-listing benefits, while
obscuring significant governance changes (including lowering the supermajority
threshold) deep within the body of the document and fails to provide adequate
reasoning for these changes. Claims of alignment with "US market practice"
lack supporting evidence. The failure to clearly flag this major governance
change upfront risks diminishing trust and compromising the business integrity
crucial for a payments provider. Owners deserve transparent and forthright
disclosure, particularly when their voting power is at stake.

 

Contravention of shareholder democracy

 

Making the matters indivisible deprives owners of a fair choice and requires
them to accept an unnecessary compromise, forcing an "all-or-nothing" vote
rather than allowing shareholders to approve a dual-listing but vote down a
resolution granting Class B Shares extended voting powers. This is contrary to
the UK Corporate Governance Code, which explicitly states: "the company should
propose a separate resolution on each substantially separate issue". This
prejudices Class A Shareholders by diluting their voting power, benefiting
those few with significant Class B Shareholdings - primarily the CEO, Kristo
Käärmann.

 

It is entirely inappropriate and unfair to wrap these distinct issues
together. Wise's owners deserve an opportunity to assess each matter on its
individual merits. This approach diminishes shareholder democracy, contradicts
good corporate governance and violates the Wise's values.

 

Corporate governance concerns

 

The current dual-class share structure has existed for four years, in line
with the assurances in the Listing Prospectus. Extending it by another decade
cannot be justified as "standard practice". In fact, such a prolonged
extension positions Wise at the extreme end of such structures and
significantly deviates from accepted governance norms.

 

Respected bodies, including the Council of Institutional Investors, as well as
academics and proxy advisors, criticise extended dual-class structures, noting
controlled firms typically underperform financially, exhibit weaker
governance, and face higher volatility. Wise should adhere to the foundational
corporate governance principle of "one share, one vote" to protect its
long-term business value and the interests of all owners equally.

 

Our Request: Separate the resolutions

 

We therefore urge fellow owners to:

 

1.   Join us in demanding that Wise splits the proposals for the
dual-listing and the extension of the sunset period for Class B Shares' voting
rights into separate resolutions, importantly, which are not
inter-conditional, and where shareholders can vote against the extension of
the sunset period and in favour of the duallisting in the United States, or
vice-versa, should they choose to do so.

2.   Demand that the Scheme of Arrangement, notices of shareholder meetings
and shareholder resolutions are amended accordingly.

3.   Request that Wise provides further detail on the rationale for the
proposed extension of the sunset period and the length of time chosen, and
explain how this aligns with the long-term interest of owners. This will
provide transparency, empower shareholders to vote independently on each
critical issue and ensure directors remain accountable to all stakeholders.

 

This will provide transparency, empower shareholders to vote independently on
each critical issue and ensure directors remain accountable to all
stakeholders.

 

Consequences of ignoring shareholder rights

 

Ignoring the above request risks eroding investor confidence, weakening
shareholder democracy, and harming Wise's long-term valuation and reputation.
Entrenching disproportionate power in the hands of a few sets a dangerous
precedent - one that contradicts the values on which Wise built its public
credibility.

 

Skaala Investments and Taavet Hinrikus remain committed, long-term supporters
of Wise, its leadership team and its global ambitions, including, in
principle, the US listing. But we cannot endorse a unilateral governance
manoeuvre that obscures material changes, circumvents investor input and
diminishes the rights of owners.

 

Wise owners deserve governance structures that enhance value, not entrench
power.

 

A company such as Wise that leads in democratising finance must also lead in
shareholder democracy.

 

We urge shareholders to vote AGAINST the scheme of arrangement unless the
issues are separated and not inter-conditional.

 

Respectfully,

 

Skaala Investments OÜ

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