Nejc Kodri is suing Bitstamp, the crypto exchange he created a decade ago, after its new owners attempted to buy out his remaining shares.
On August 12, the complaint was filed at the United Kingdom’s High Court of Justice. It relates to a call option exercised on July 21 by Bitstamp Holdings NV, which would see the business acquire Kodri’s remaining Bitstamp shares for $13.46 million – a sum he alleges is “substantially lower than the present worth of the shares.”
Kodri had already sold two-thirds of his Bitstamp shares when the company was acquired in October 2018 by Belgium-based investment group NXMH, a subsidiary of South Korea’s NXC Corporation. However, he kept a 9.8 percent interest and would continue to serve as CEO until October 2020.
His lawsuit shows that, following the acquisition, Bitstamp planned to pursue a $1 billion valuation via an initial public offering. It also describes how Kodri was dismissed as CEO and then denied the opportunity to become chairman.
“Bitstamp’s two largest shareholders – NXMH and Nejc Kodri – have a private shareholder matter that is being worked through,” said Julian Sawyer, who joined Bitstamp as CEO in July 2020 after a brief stint at Gemini Europe. “As a key player in the crypto realm, these types of debates frequently reach the public sphere.”
NXMH’s spokesman reaffirmed Sawyer’s position but declined to comment further. Kodri did not react to comment inquiries.
When NXMH bought out 80 percent of Bitstamp in 2018, Kodri’s fellow Slovenian and co-founder Damian Merlak sold all of his shares and stepped down as a director.
Kodri, on the other hand, remained CEO and eventually transferred his shares to White Whale Capital, a Luxembourg-based family office, in September 2019.
As part of the deal, Kodri and Bitstamp’s new owners agreed to options agreements that allowed both parties the ability to trigger the sale of his remaining shares to NXMH at defined times in 2020, 2021, and 2022.
Following the takeover, Bitstamp lost no time in seeking more funding. According to the accusation, Kodri and Hendrik Ghys, who was nominated to Bitstamp’s board by NXMH, travelled to New York in May 2019 to talk with investment banks about raising financing at a $1 billion valuation.
The trip raised concerns for Kodri, who believed that the valuation would cause NXMH to execute its call option and acquire his remaining shares for a low price.
According to the lawsuit, Ghys and NXMH’s other board representative Jong Hyun (Jamie) Hong revealed plans to target an IPO at a $1 billion value within three years at a strategy discussion at the Hotel Le Royal in Luxembourg on December 16, 2019.
Kodri claims to have sought assurances from NXMH and its board appointees that the call option would not be exercised at both points. Indeed, he claims to have made that a condition of his support for the company’s IPO campaign. He also alleges that Ghys and Hong assured him in “clear and unmistakable words.”