Stewards updates Envy acquisition pro forma, books USD 20.04 million required-redemption liability for escrowed shares
SWRD•SWRD•SWRD•SWRD•Stewards revised its preliminary accounting for the Envy Acquisition and recorded a USD 20.04 million required-redemption liability for 7 million escrowed shares.
Stewards reclassified 7,000,000 escrowed shares as a mandatorily redeemable instrument rather than stockholders’ equity. It measured the USD 20.04 million liability as the present value of seven monthly USD 3 million payments, discounted at a preliminary 18% annual effective rate.
The company shifted USD 0.957 million of discount accretion into FY2025 interest expense, assuming the acquisition occurred on Jan. 1, 2025. The changes could alter the final liability measurement, acquired-asset basis, depreciation, amortization and interest expense; Stewards expects to finalize the accounting in its next periodic report.
