Summary

  • RUM Group’s planned move toward 98% of Northern Data rests on a contractual exchange with Tether at 2.0281 RUM securities for each Northern Data share; Tether’s filing says the top-up is to be settled with warrants exercisable for 16,744,307 RUM shares.
  • That exchange formula is not the cash compensation for the residual shareholders. Northern Data says the squeeze-out valuation remains unfinished, and both the German-law process and the amount to be paid require further steps.

A percentage is not a price

The next Northern Data milestone is being described as an ownership number. It should not be mistaken for a valuation. RUM Group said on 10 September that it expected to raise its holding from about 85.2% to approximately 98% by acquiring more shares from Tether. Northern Data’s same-day notice put the expected level at roughly 98.03% on or around 30 September. The date is a forecast in those documents, not evidence that the transfer has completed.

The distinction matters because the transaction has two different counterparties, instruments and clocks. Under the existing Transaction Support Agreement, Tether agreed to exchange additional Northern Data shares acquired at each month-end for RUM Class A shares, or pre-funded warrants in their place, using the 2.0281 exchange ratio. Tether’s Schedule 13D Amendment No. 4 reports that it acquired beneficial ownership of 8,256,155 Northern Data shares on 2 September. RUM’s 10 September release later described the RUM-side exchange as expected to settle around 30 September.

The 13D says RUM must issue Tether pre-funded warrants exercisable for exactly 16,744,307 RUM Class A shares upon its acquisition of those Northern Data shares. Beneficial ownership at Tether and settlement to RUM are distinct steps. This is a contractual top-up between Tether and RUM, not an announced cash offer to every remaining Northern Data holder.

RUM’s 10 September release described the expected settlement around 30 September as the step that would move its Northern Data ownership toward 98%. It also said the company had notified Northern Data of its intention to start squeeze-out proceedings for the remaining approximately 2%. The sequence is therefore: first, a securities exchange with Tether; next, a separate request to remove the minority through the German stock-law process. As of this manuscript’s publication check, the public notices reviewed still describe the September 30 settlement as expected; no later official confirmation is being treated as proof of completion.

The minority route has another valuation basis

For a squeeze-out under sections 327a and following of the German Stock Corporation Act, a principal shareholder with at least 95% of the target’s share capital may ask the target’s general meeting to transfer the remaining shares in return for an appropriate cash settlement. Crossing that threshold opens a legal route; it does not itself transfer the residual shares or set the amount. The general meeting must adopt the transfer resolution, and the resolution must be entered in the commercial register before the transfer takes effect.

The valuation step is still ahead. Northern Data’s notice says Rumble Deutschland AG will determine the cash amount per share from a company valuation that has yet to be completed and will state it in a formal squeeze-out request. Under section 327b, the principal shareholder determines the amount, taking the company’s circumstances at the date of the general-meeting resolution into account. The process also calls for a report explaining why the compensation is appropriate and an expert audit. German law provides for court review on application if the amount is inadequate.

RUM made the pricing distinction explicit: the squeeze-out payment may differ from Northern Data’s market price and from prices in bilateral trades, including Tether’s. That warning prevents the 2.0281 ratio from being used as a hidden cash price. It is a number of RUM securities per Northern Data share, and the value of those securities moves with RUM’s equity and the terms of the warrants. The future cash compensation is a separate per-share amount whose valuation, timing and review are not yet public.

What is being consolidated

RUM closed its acquisition of Northern Data in June and reported ownership of about 85.2%. The company described the target as a large compute estate with roughly 22,000 high-end Nvidia GPUs and more than 200 MW of unmonetized energy capacity. Those are issuer-reported operating descriptors, not a standalone valuation, cash-flow forecast or proof that the infrastructure is already generating a return. The current squeeze-out notices do not publish Northern Data’s valuation model, per-share cash amount or the assumptions behind it.

The distinction has consequences for both sides of the cap table. Tether’s top-up gives it securities of the listed parent under a ratio set in a prior agreement. Minority Northern Data holders would instead receive cash under a statutory valuation and approval sequence if the squeeze-out proceeds. The transfer can therefore bring control close to completion while leaving the last price unresolved. Neither the target’s quoted share price nor Tether’s exchange ratio is automatically the statutory amount.

That is not evidence that one route is fair and the other is not. It is a reason to wait for the documents that answer different questions: confirmation that the top-up settled, the formal squeeze-out request, the valuation report and expert review, the general-meeting resolution, registration and the cash-payment terms. Until those arrive, 98% describes where RUM expects to stand in the ownership structure, not what the remaining shares are worth.

Sources