• K1 has submitted a proposal to MariaDB that includes the acquisition of all of MariaDB’s shares in MariaDB for $0.55 per share.
  • The company has brought in a new CEO and made massive layoffs as it divested its database-as-a-service and geospatial businesses, according to sources.
  • In many ways, K1 may be better suited to take over MariaDB than Runa.

An exploratory proposal

To MariaDB K1 said on Friday it had submitted a so-called “unsolicited non-binding indicative proposal“, this is a non-binding exploratory proposal, may according to the negotiation progress and change in the next few weeks.

The proposal involves buying all of MariaDB’s stock in MariaDB for $0.55 per share, which is about $37 million based on the company’s closing valuation on Feb. 5, though it hasn’t determined what form the offer will take.
The news comes at a time of significant change and turmoil for the company, which has ushered in a new CEO and made massive layoffs as it spun off its database-as-a-service and geospatial businesses.

MariaDB is a fork of MySQL, whose project creators became concerned about its independence 15 years ago after a series of multibillion-dollar acquisitions resulted in Oracle effectively owning MySQL in 2009. To this day, MariaDB is considered a “temporary” replacement for those seeking a fully open source alternative to MySQL, and has been used by well-known companies to store and manipulate data in their applications.
The commercial entity behind MariaDB raised around $230 million in venture capital over the years to develop premium features and services built on top of the core project, culminating in a public offering through a special purpose acquisition company (SPAC) in December 2022. Like most Pacific-based ipos, MariaDB’s listing was far from a huge success, falling from a $445 million market cap on its first day of listing in late 2022 (a huge drop from the $672 million private enterprise value of its earlier Series D) to a prolonged slump, It has been hovering just above $10 million since the beginning of the year.

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Cause of event

At the heart of it all was a series of sub-par earnings reports from MariaDB.In September, the New York Stock Exchange warned MariaDB that it was not in compliance with listing rules, which stipulate that a company’s global average market capitalisation must not fall below $50m in a continuous 30-day trading period.
In the following months, MariaDB received its first “unsolicited non-binding indicative proposal,” this time from existing investor Runa Capital, which made a preliminary cash offer of $0.56 per share.Three weeks later, Runa said it wouldn’t buy MariaDB and instead an affiliate called RP Ventures would provide a $26.5 million loan.

Fast forward to early February of this year, MariaDB announced that it had reached a temporary extension agreement with its creditors, which means that creditors will not exercise any of the remedies provided for in the loan agreement while it seeks an alternative financing solution.The news caused MariaDB’s stock price to more than double in a matter of days, which is why K1 made an offer relative to MariaDB’s closing price before any extension agreement was announced.
So, in many ways, K1 may be better suited to take over MariaDB than Runa, even if it ultimately decides against it.
Under Irish takeover rules, K1 has until March 29, 2024 to formalize its offer or abandon the plan entirely, as one of MariaDB’s headquarters is located in Dublin, Ireland, and the other in Redwood City, California.