TIDMHMA1
RNS Number : 9258J
HIRO Metaverse Acquisitions I S.A.
29 April 2022
29 April 2022
Hiro Metaverse Acquisitions I S.A.
("Hiro" or the "Company" or, together with its subsidiaries, the
"Group")
Annual Report and Financial Statements for the period ended 31
December 2021
Hiro Metaverse Acquisitions I S.A. (hereinafter referred to as
HMAI or the "Company") the special purpose acquisition company
sponsored by Hiro Sponsor I LLP (the "Sponsor"), an affiliate of
Hiro Capital, a videogames and metaverse technology venture capital
fund, is pleased to announce its results for the period ended 31
December 2021.
A copy of the Annual Report and Financial Statements will also
available on the Company's website at
https://hma1.hiro.capital/investor-resources/ where further
information on the Company can also be found. The Annual Report has
also been submitted to the National Storage Mechanism and will
shortly be available at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
For further information please contact:
For enquiries:
Hiro Metaverse Acquisitions 1
Peter@hiro.capital
+31612967281
JTC Group - Company Secretary & Administrator
Hiro.cosec@jtcgroup.com
+44 203 846 9774
About Hiro Metaverse Acquisitions I S.A.
Hiro Metaverse Acquisitions I S.A. (hereinafter referred to as
HMAI or the "Company") is a special purpose acquisition company
sponsored by Hiro Sponsor I LLP (the "Sponsor"), an affiliate of
Hiro Capital, a videogames and metaverse technology venture capital
fund.
Founded by Luke Alvarez, Sir Ian Livingstone CBE and Cherry
Freeman, three senior leaders with an established track record of
entrepreneurship and investments in the video gaming, digital
sports and technology sectors. Hiro Capital invests in high-growth
video games, esports, interactive streaming, gamified fitness and
metaverse technology innovators. The founding team having
collectively co-founded and invested in over $9 billion worth of
companies in these sectors, from start-ups to IPO in London and New
York.
HMAI raised GBP115 million through a listing on the London Stock
Exchange.
The Company is focused on targets operating in the sectors of
video games, esports, interactive streaming, GenZ social networks,
connected fitness & wellness and metaverse technologies with
principal business operations in the U.K., Europe or Israel,
although it may pursue an acquisition opportunity in any industry
or sector or region.
The Company was incorporated for the purpose of acquiring a
stake in a company or operating business (the "Target" or "Target
Business") through a merger, capital stock exchange, share
purchase, asset acquisition, reorganisation or similar transaction
(an "Initial Business Combination").
Hiro Metaverse Acquisitions I S.A.
Société Anonyme
Registered address: 17, Boulevard F.W., L-2411Luxembourg
R.C.S. Luxembourg: B 259488
(the "Company" or the "Group")
DIRECTORS REPORT
to the annual general meeting of the shareholders of
HiRO METAVERSE ACQUISITIONS I S.A.
According to the prevailing law and the mandate you have granted
to us we are pleased to report the results for the company's first
financial year from incorporation 20 September to 31 December 2021
(the " Financial Year ") .
We herewith submit to your meeting the Groups' audited
consolidated financial statements consisting of the Company's
Consolidated statement of comprehensive income, the Consolidated
statement of financial position, Consolidated statement of changes
in equity; Consolidated statement of cash flows and the Notes to
the consolidated financial statements . and the Company's audited
Separate financial statements consisting of the Company's Separate
statement of comprehensive income, the Separate statement of
financial position, Separate statement of changes in equity;
Separate statement of cash flows and the Notes to the separate
financial statements regarding the Financial Year
STATUS AND ACTIVITIES
The Company is a public limited liability company (société
anonyme) incorporated and operating under the laws of the Grand
Duchy of Luxembourg.
The Company was incorporated for the purpose of acquiring a
majority (or otherwise controlling) stake in a company or operating
business (the "Target" or "Target Business") through a merger,
capital stock exchange, share purchase, asset acquisition,
reorganisation or similar transaction (an "Initial Business
Combination"). The Company intends to focus on targets operating in
the sectors of video games, esports, interactive streaming, GenZ
social networks, connected fitness & wellness and metaverse
technologies with principal business operations in the U.K., Europe
or Israel, although it may pursue an acquisition opportunity in any
industry or sector or region. Prior to the completion of its
Initial Business Combination, the Company is not engaging in any
operations, other than in connection with the selection,
structuring and completion of its Initial Business Combination.
The Company will need to obtain shareholder approval on the
proposed Initial Business Combination at a general meeting
specifically convened for this purpose (other than in respect of
any Restricted Shares, being Public Shares held by the Directors,
the Sponsor or any Insiders).
The Company's main objective is to complete its Initial Business
Combination within an initial period of 15 months following
admission to trading, subject to an initial three-month extension
period (the "First Extension Period") and a further three-month
extension period (the "Second Extension Period"), in each case if
approved by shareholder vote (the "Business Combination Deadline"),
although such extensions are not of a type required to be approved
by Public Shareholders as contemplated by Listing Rule
5.6.18AG.
During the financial year the Company did not open any branches
either in Luxembourg or abroad.
The review and development of the company's business, financial
performance and position are addressed by the board in both the
preceding and below paragraphs.
RESULTS AND DIVIDS
At the end of the period under review the Company recorded a
loss of GBP 152,428.
The Company has not yet adopted a dividend policy. The Company
has not paid any dividends to date and will not pay any dividends
prior to the Initial Business Combination.
SHARE CAPITAL
The share capital of the Company on 20 September 2021 was set at
GBP 30,000, represented by 3,750,000 Sponsor Shares without nominal
value.
The section below headed Subsequent Events sets out the changes
to the share capital subsequent to the end of the Financial Year
following a placing and subsequent admission to trading of the
Company's Public Shares on the Main Market of the London Stock
Exchange on 7 February 2022.
VOTING RIGHTS
Each Ordinary Share confers the right to cast one vote at the
general meeting. Sponsor Shares have the same voting rights
attached to them as all other Ordinary Shares.
OWN SHARES
During the financial year the Company did not hold any of its
own shares.
RESEARCH AND DEVELOPMENT
During the financial year the Company did not perform any
research and development activity.
DIRECTORS
During the Financial Year the Board of Directors (the "Board")
consisted of:
Name Position Date of appointment Date of resignation
------------------------------ ------------------- ------------------------------ ------------------------------
Mr Joost A. Director 20 September 2021 10 December 2021
Mees
------------------------------ ------------------- ------------------------------ ------------------------------
Mr Luke Alvarez Director 28 October 2021 n/a
Ms Cherry Freeman Director 28 October 2021 n/a
------------------------------
Sir Ian Livingstone Director 10 December 2021 n/a
------------------------------ ------------------- ------------------------------ ------------------------------
It is noted that Mr Joost A. Mees resigned as a Director of the
Company on 10 December 2021 and was replaced by Sir Ian Livingstone
on 10 December 2021.
The Board is responsible for leading and controlling the Company
and has overall authority for the management and conduct of its
business, strategy and development. The Board is also responsible
for ensuring the maintenance of a sound system of internal controls
and risk management (including financial, operational and
compliance controls) and for reviewing the overall effectiveness of
systems in place as well as for the approval of any changes to the
capital, corporate and/or management structure of the Company.
CORPORATE GOVERNANCE STATEMENT
As a Luxembourg governed company that will be traded on the
London Stock Exchange, the Company is not required to adhere to the
Luxembourg corporate governance regime applicable to companies that
are traded in Luxembourg. As this regime has not been designed for
special purpose acquisition companies like the Company but for
fully operational companies, the Company has opted to not apply the
X Principles of Corporate Governance of the Luxembourg Stock
Exchange on a voluntary basis.
In addition, the Company voluntarily complies with the
requirements of the U.K. Corporate Governance Code, save as set out
below:
-- Given the composition of the Board and the size and nature of
the Company, the Board considers certain provisions of the U.K.
Corporate Governance Code (in particular the provisions relating to
the division of responsibilities between the chairman, chief
executive and senior independent director, annual performance
evaluation and executive compensation) to be inapplicable to the
Company.
-- The Company will not have nomination or remuneration
committees prior to completion of its Initial Business Combination.
The Board does not consider the nomination or remuneration
committees to be necessary given the size and nature of the
Company. Consequently, the Board will not appoint a remuneration
consultant.
-- The U.K. Corporate Governance Code recommends the submission
of all directors for re-election at annual intervals. No Director
will be required to submit for re-election until the first annual
general meeting of the Company following the Initial Business
Combination.
-- The Board has adopted a share dealing code which is
consistent with the rules of the U.K. Market Abuse Regulation. The
Board will be responsible for taking all proper and reasonable
steps to ensure compliance with such share dealing code by the
Directors.
The audit committee (the "Audit Committee") performs its duties
in compliance with applicable laws. The Audit Committee is composed
of independent directors of the Company and is responsible for all
matters relating to financial controls and reporting, internal and
external audits, the scope and results of audits and the
independence and objectivity of auditors. It monitors and reviews
the Group's audit function and, with the involvement of its
auditor, focuses on compliance with applicable legal and regulatory
requirements and accounting standards. The Audit Committee consists
of Emily Greer, Addie Pinkster and Jurgen Post (chair).
FINANCIAL INSTRUMENTS
The Company's financial assets include equity instruments, cash
and cash equivalents and trade and other receivables. Trade and
other receivables are classified in accordance with IAS 39 and
further details can be obtained from the Notes to the financial
statements.
Equity instruments are classified as investments in
subsidiaries. Disclosures of acquisitions and disposal of shares in
affiliated undertakings are contained in the investments in
subsidiaries.
PRINCIPAL RISKS AND UNCERTAINTIES
The following is a summary of key risks that, alone or in
combination with other events or circumstances, could have a
material adverse effect on the Company's business, financial
condition, results of operations and prospects. In making the
selection, the Company has considered circumstances such as the
probability of the risk materialising, the potential impact which
the materialisation of the risk could have on the Company's
business, financial condition and prospects, and the attention that
management would, on the basis of current expectations, have to
devote to these risks if they were to materialise:
-- The Company is a newly formed entity with no operating
history and the Company has not generated and currently does not
generate any revenues and, as such, prospective investors have no
basis on which to evaluate the Company's performance and ability to
achieve its business objective.
-- The Company has not yet identified any specific potential
Target Business with which to complete its Initial Business
Combination and, as such, prospective investors have no basis on
which to evaluate the possible merits or risks of a Target
Business's operations or specific industry.
-- There is no assurance that the Company will identify suitable
Initial Business Combination opportunities by the Business
Combination Deadline, which could result in a loss of part of the
investment of shareholders.
-- The Company may face significant competition for Initial
Business Combination opportunities.
-- The requirement that the Company complete its Initial
Business Combination by the Business Combination Deadline may give
potential Target Businesses leverage over the Company in
negotiating the Initial Business Combination and may limit the time
the Company has in which to conduct due diligence on potential
Target Businesses, which could undermine its ability to complete
its Initial Business Combination on terms that would produce value
for shareholders.
-- Public Shareholders' ability to exercise redemption rights
with respect to a large number of the Public Shares may not allow
the Company to complete the most desirable Initial Business
Combination or optimise its capital structure.
-- The nominal price paid by the Sponsor for the Sponsor Shares
and the conversion of the Sponsor Shares into Public Shares may
incentivise the Sponsor and the Directors to complete an Initial
Business Combination in order to realise a significant profit
regardless of whether the trading price of Public Shares declines
materially.
-- The Sponsor, the Directors and their respective affiliates
may have competitive interests that conflict with the Company's
interests.
-- Until consummation of an Initial Business Combination, the
Sponsor will hold a substantial interest in the Company and control
the appointment of the Board. As a result, it may exert a
substantial influence on the Company, potentially in a manner that
investors do not support.
-- Past performance by the Company's management team, the
Sponsor and their affiliates and their respective directors and
management teams, including investments and transactions in which
they have participated and businesses with which they have been
associated, may not be indicative of future performance of an
investment in the Company.
-- The Sponsor has paid approximately GBP0.01 per Sponsor Share
and, accordingly, investors will experience substantial dilution
upon conversion of the Sponsor Shares into Public Shares.
-- The Company may issue additional Public Shares to complete
its Initial Business Combination, including via a private
investment in public equity, or PIPE transaction, or under an
employee incentive plan after completion of its Initial Business
Combination. Any such issuances would dilute the interest of the
Public Shareholders and likely present other risks.
-- The outstanding Public Warrants, Sponsor Warrants and
Overfunding Warrants will become exercisable in the future, which
may increase the number of Public Shares and result in further
dilution for the Public Shareholders, and investors may also
experience a dilution of their percentage ownership of the Company
if they do not exercise their Public Warrants or if other investors
exercise their Public Warrants.
-- If the Company is liquidated before the Business Combination
Deadline and distributes the amounts held in the Escrow Account as
liquidation proceeds, Public Shareholders could receive less than
GBP10.30 per Public Share (assuming there are no Additional
Overfunding Subscriptions) or nothing at all. In addition, it is
difficult to predict when the amounts held in the Escrow Account
(if any) will be returned to the Public Shareholders.
-- There is a risk that the market for the Public Shares or the
Public Warrants will not be active and liquid, which may adversely
affect the liquidity and price of the Public Shares and the Public
Warrants.
STATEMENT OF GOING CONCERN
The Directors, having considered the financial position of the
Company for a period of least 12 months from the date of approval
of the financial statements, have a reasonable expectation and
belief that the Company has adequate resources to continue in
operational existence for the foreseeable future given the
available cash and forecast cash outflows.
SUBSEQUENT EVENTS
On 2 February 2022, the number of Sponsor Shares was reduced
from 3,750,000 to 2,875,000.
On 2 February 2022, the share capital of the Company was
increased from GBP 30,000 to GBP 152,829.20 represented by
11,810,500 Public Shares (Class A ordinary shares) and 2,875,000
Sponsor Shares (Class B ordinary shares).
The Company's Public Shares were admitted to trading on the Main
Market of the London Stock Exchange on 7 February 2022 following a
placing of Public Shares at a price of GBP 10 per Public Share.
Each Public Share entitled the holder to receive one-half (1/2) of
one Public Warrant. Each whole Public Warrant entitles a holder to
subscribe for one Public Share for an exercise price of GBP 11.50
per new Public Share. The Public Warrants were issued to holders of
Public Shares and admitted to the Main Market of the London Stock
Exchange on 24 February 2022.
On 8 February 2022, the share capital of the Company was
increased from GBP 152,829.20 to GBP 156,417.20 represented by
11,845,000 Public Shares (Class A ordinary shares) and 2,875,000
Sponsor Shares (Class B ordinary shares).
MANAGEMENT REPORT
For the purposes of compliance with DTR 4.1.5R(2), DTR 4.1.8R
and DTR 4.1.11R the required content of the Management Report can
be found in this Report of Directors.
DIRECTORS' RESPONSIBILITY STATEMENT
The Board is responsible for preparing the Report and the
financial statements in accordance with applicable law and
regulations. Company law requires the Board to prepare financial
statements for each financial year. Under that law the Board has
prepared the Company's separate financial statements and the
Group's consolidated financial statements in accordance with
International Financial Reporting Standards (IFRSs) as adopted by
the European Union.
Under company law the Board must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Company and of the profit or
loss of the Company for that year. In preparing these financial
statements, the Board is required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and accounting estimates that are reasonable and best estimate;
-- present the financial statements and policies in a manner
that provides relevant, reliable, comparable and understandable
information;
-- state whether they have been prepared in accordance with
applicable IFRSs as adopted by the EU;
-- assess the Company's ability to continue as a going concern,
disclosing, as applicable matters related to going concern; and
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company will
continue in business.
The Board is responsible for keeping adequate accounting records
that are sufficient to show and explain the Company's transactions
and disclose with reasonable accuracy at any time the financial
position of the Company and enable it to prepare the financial
statements, and ensure that the financial statements comply with
company law. It is responsible for such internal control as it
determines necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to
fraud or error, and has general responsibility for taking such
steps as are reasonably open to it to safeguard the assets of the
Company and to prevent and detect fraud and other
irregularities.
The Board is responsible for the maintenance and integrity of
corporate and financial information included on the Company's
website. The financial statements are published on the Company's
website.
Legislation in Luxembourg governing the preparation and
dissemination of financial statements may differ from legislation
in other jurisdictions.
The Board, to the best of its knowledge, confirms that:
-- the financial statements, prepared in accordance with
applicable accounting standards, give a true and fair view of the
assets, liabilities, financial position and profit or loss of the
Company included in the consolidation as a whole; and
-- the Management Report includes a fair review of the
development of the business and the position of the Company in the
consolidation taken as a whole, together with a description of the
principal risks and uncertainties.
The Board considers the Annual Report and the Company's separate
financial statements and the Group's consolidated financial
statements taken as a whole is fair, balanced and understandable
and provides the information necessary for shareholders to assess
the Company's position and performance, business model and
strategy.
INTERNAL CONTROL
The Board is responsible for determining the nature and extent
of the significant risks it is willing to take in achieving its
strategic objectives. The Board maintains sound risk management and
internal control systems. The Board has reviewed the Company's risk
management and control systems and believes that the controls are
satisfactory given the nature and size of the Company. Controls
will be reviewed following completion of the Initial Business
Combination.
DISCLOSURE OF INFORMATION TO AUDITORS
So far as the Board is aware, there is no relevant audit
information of which the Auditor is unaware. The Directors have
taken all steps that they ought to have taken as Directors to make
themselves aware of any relevant audit information and to establish
that the Auditor is aware of that information.
Finally, we request you to adopt the annual accounts and to
grant discharge to the members of the Board of Directors and the
statutory auditor for their mandate during the financial year
2021.
Luxembourg, 25 April 2022
Ian Livingstone Luke Alvarez
Director Director
Cherry Freeman Jurgen Post
Director Independent Non-Executive
Director
--------------------------- -------------------------------
Emily Greer Addie Pinkster
Independent Non-Executive Independent Non-Executive
Director Director
To the Shareholders of
HIRO METAVERSE ACQUISITIONS I S.A.
Société Anonyme
R.C.S. Luxembourg B 259.488
17, Boulevard Raiffeisen
L-2411 Luxembourg
REPORT OF THE REVISEUR D'ENTREPRISES AGREE
Report on the Audit of the Consolidated Financial Statements
Opinion
We have audited the consolidated financial statements of HIRO
METAVERSE ACQUISITIONS I S.A. and its subsidiary (the "Group"),
which comprise the consolidated statement of financial position as
of 31 December 2021, and the consolidated statement of
comprehensive income, consolidated statement of changes in equity
and consolidated statement of cash flows for the period from 20
September 2021 (date of incorporation) to 31 December 2021, and
notes to the consolidated financial statements, including a summary
of significant accounting policies.
In our opinion, the accompanying consolidated financial
statements give a true and fair view of the consolidated financial
position of the Group as at 31 December 2021, and of its
consolidated financial performance and its consolidated cash flows
for the period from 20 September 2021 (date of incorporation) to 31
December 2021 in accordance with International Financial Reporting
Standards (IFRSs) as adopted by the European Union.
Basis for Opinion
We conducted our audit in accordance with the EU Regulation Ndeg
537/2014, the Law of 23 July 2016 on the audit profession ("Law of
23 July 2016") and with International Standards on Auditing
("ISAs") as adopted for Luxembourg by the "Commission de
Surveillance du Secteur Financier" ("CSSF"). Our responsibilities
under the EU regulation No 537/2014, the Law of 23 July 2016 and
ISAs as adopted for Luxembourg by the CSSF are further described in
the << Responsibilities of the "réviseur d'entreprises agréé"
for the Audit of the Consolidated Financial Statements >>
section of our report. We are also independent of the Group in
accordance with the International Code of Ethics for Professional
Accountants, including International Independence Standards, issued
by the International Ethics Standards Board for Accountants (IESBA
Code) as adopted for Luxembourg by the CSSF together with the
ethical requirements that are relevant to our audit of the
consolidated financial statements, and have fulfilled our other
ethical responsibilities under those ethical requirements. We
believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Key Audit Matters
Key Audit Matters are those matters that, in our professional
judgment, were of most significance in our audit of the financial
statements of the current period. These matters were addressed in
the context of the audit of the consolidated financial statements
as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
Based on the result of our audit procedures no Key Audit Matters
were identified for the audit of the consolidated financial
statements as of 31 December 2021.
Other information
The Board of Directors is responsible for the other information.
The other information comprises the information stated in the
Directors report including the Corporate Governance Statement but
does not include the consolidated financial statements and our
report of the "réviseur d'entreprises agréé" thereon.
Our opinion on the consolidated financial statements does not
cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the consolidated financial
statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is
materially inconsistent with the consolidated financial statements
or our knowledge obtained in the audit or otherwise appears to be
materially misstated. If, based on the work we have performed, we
conclude that there is a material misstatement of this other
information, we are required to report this fact. We have nothing
to report in this regard.
Responsibilities of the Board of Directors and Those Charged
with Governance of the Group for the Consolidated Financial
Statements
The Board of Directors is responsible for the preparation and
fair presentation of the consolidated financial statements in
accordance with IFRSs as adopted by the European Union and for such
internal control as the Board of Directors determines is necessary
to enable the preparation of consolidated financial statements that
are free from material misstatement, whether due to fraud or
error.
The Board of Directors is also responsible for presenting and
marking up the consolidated financial statements in compliance with
the requirements set out in the Delegated Regulation 2019/815 on
European Single Electronic Format, as amended ("ESEF
Regulation").
In preparing the consolidated financial statements, the Board of
Directors is responsible for assessing the Group's ability to
continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of
accounting unless the Board of Directors either intends to
liquidate the Group or to cease operations, or has no realistic
alternative but to do so.
Those charged with governance are responsible for overseeing the
Group's financial reporting process.
Responsibilities of the "Réviseur d'Entreprises Agréé" for the
Audit of the consolidated financial statements
The objectives of our audit are to obtain reasonable assurance
about whether the consolidated financial statements as a whole are
free from material misstatement, whether due to fraud or error, and
to issue a report of the "Réviseur d'Entreprises Agréé" that
includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in
accordance with accordance with the EU Regulation Ndeg 537/2014,
the Law of 23 July 2016 and with ISAs as adopted for Luxembourg by
the CSSF will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users
taken on the basis of these consolidated financial statements.
As part of an audit in accordance with the EU Regulation Ndeg
537/2014, the Law of 23 July 2016 and with ISAs as adopted for
Luxembourg by the CSSF, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
-- Identify and assess the risks of material misstatement of the
consolidated financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide
a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal
control.
-- Obtain an understanding of internal control relevant to the
audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Group's internal control.
-- Evaluate the appropriateness of accounting policies used and
the reasonableness of accounting estimates and related disclosures
made by the Board of Directors.
-- Conclude on the appropriateness of Board of Directors' use of
the going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group's
ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in
our report of the "Réviseur d'Entreprises Agréé" to the related
disclosures in the consolidated financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our
report of the "Réviseur d'Entreprises Agréé". However, future
events or conditions may cause the Group to cease to continue as a
going concern.
-- Evaluate the overall presentation, structure and content of
the consolidated financial statements, including the disclosures,
and whether the consolidated financial statements represent the
underlying transactions and events in a manner that achieves fair
presentation.
-- Assess whether the consolidated financial statements have
been prepared in all material respects with the requirements laid
down in the ESEF Regulation.
-- Obtain sufficient appropriate audit evidence regarding the
financial information of the entities and business activities
within the Group to express an opinion on the consolidated
financial statements. We are responsible for the direction,
supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies
in internal control that we identify during our audit.
We also provide those charged with governance with a statement
that we have complied with relevant ethical requirements regarding
independence, and communicate to them all relationships and other
matters that may reasonably be thought to bear on our independence,
and where applicable, actions taken to eliminate threats or
safeguards applied.
From the matters communicated with those charged with
governance, we determine those matters that were of most
significance in the audit of the consolidated financial statements
of the current period and are therefore the key audit matters. We
describe these matters in our report unless law or regulation
precludes public disclosure about the matter.
Report on Other Legal and Regulatory Requirements
We have been appointed as "réviseur d'entreprises agréé" on 20
September 2021 and the duration of our uninterrupted engagement,
including previous renewals and reappointments, is 1 year.
The Directors report is consistent with the consolidated
financial statements and has been prepared in accordance with
applicable legal requirements.
We have checked the compliance of the consolidated financial
statements of the Group as at 31 December 2021 with relevant
statutory requirements set out in the ESEF Regulation that are
applicable to the consolidated financial statements. For the Group
it related to:
- Consolidated Financial Statements prepared in valid xHTML format;
- The XBRL markup of the Consolidated Financial Statements using
the core taxonomy and the common rules of markups specified in the
ESEF Regulation
In our opinion, the consolidated financial statements of the
Group as of 31 December 2021, identified as
222100X27S5HMALJTB53-2021-12-31, have been prepared, in all
material respects, in compliance with the requirements laid down in
the ESEF Regulation.
We confirm that the audit opinion is consistent with the
additional report to the audit committee.
We confirm that the prohibited non-audit services referred to in
EU Regulation No 537/2014 were not provided and that we remained
independent of the Group in conducting the audit.
Luxembourg, 27 April 2022
For Mazars Luxembourg, Cabinet de révision agréé
5, rue Guillaume J. Kroll
L-1882 Luxembourg
Nadhmi AMOURI
Réviseur d'entreprises agréé
Consolidated statement of comprehensive income for the
period
20 September 2021 to 31 December 2021
20 Sept 2021
to
Note 31 Dec 2021
----- -------------
GBP
Revenue........................................................................................
............................ --
Other operating
expenses...................................................................................... 5 (152,560)
Taxes, duties and similar
expenses...................................................................... 6 --
Operating
(loss)/profit.................................................................................
........ (152,560)
Finance
income.........................................................................................
.............. --
Finance
costs..........................................................................................
................. --
Foreign currency exchange
gains/(losses)........................................................... 272
Loss before income
tax........................................................................................ (152,288)
Income
tax............................................................................................
................... 6 --
Profit/(loss) for the
period.................................................................................. (152,288)
Other comprehensive
income............................................................................. --
Total comprehensive income/(loss) for the period, net of tax.................... (152,288)
=============
Earnings/(loss) per share attributable to equity holders
Net earnings per
share......................................................................................... 7
(0.04)
The accompanying notes form an integral part of these
consolidated financial statements .
Consolidated Statement of financial position as at 31 December
2021
Assets Notes 31 Dec 2021
------------------------------------------------------------------------------------------------ ------ ------------
GBP
Current assets
Deferred
costs.........................................................................................
.................. 8 731,407
Trade and other
receivables................................................................................... -
Cash and cash
equivalents...................................................................................
.. 9 30,000
------------
Current
assets........................................................................................
.................. 761,407
Total Assets 761,407
============
Equity and liabilities
Equity
Share
capital.......................................................................................
...................... 10 30,000
Accumulated
deficit.......................................................................................
......... (152,288)
------------
(122,288)
Liabilities
Current liabilities
Trade and other
payables......................................................................................
. 11 883,695
Taxes
payable........................................................................................
.................. 6 --
------------
Total current liabilities5 883,695
Total
liabilities...................................................................................
..................... 883,695
Total equity and
liabilities................................................................................... 761,407
============
The accompanying notes form an integral part of these
consolidated financial statements.
Consolidated statement of changes in equity for the period ended
31 December 2021
Notes Share capital Accumulated deficit Total equity
------ -------------- -------------------- -------------
GBP GBP GBP
Issuance of incorporation capital........... 10 30,000 -- 30,000
Loss for the period..................................... -- (152,288) (152,288)
Other comprehensive income.................. -- -- --
Balance at 31 December 2021.............. 30,000 (152,288) (122,288)
============== ==================== =============
The accompanying notes form an integral part of these
consolidated financial statements.
Consolidated statement of cash flows for the for the period
20 September 2021 to 31 December 2021
20 Sept 2021
to
31 Dec 2021
-------------
GBP
Cash flow from operating activities
Loss before income
tax..................................................................................................
.................. (152,288)
Adjustments for:
* Finance
income...............................................
.....................................................
.......................... --
* Finance
expense..............................................
.....................................................
.......................... --
-------------
Net cash from operating activities before income
tax............................................................ (152,288)
Changes in working capital:
* Increase in deferred
costs................................................
.....................................................
........ (731,407)
* Increase in trade and other
payables.............................................
............................................ 883,695
-------------
Net cash flows from operating
activities.................................................................................... --
-------------
Cash flow from financing activities
Proceeds from issue of ordinary
shares......................................................................................... 30,000
Net cash flows from financing
activities.................................................................................... 30,000
-------------
Net change in cash and cash
equivalents..................................................................................... 30,000
Cash and cash equivalents,
beginning........................................................................................... --
-------------
Cash and cash equivalents at the end of the
period................................................................. 30,000
=============
The accompanying notes form an integral part of these
consolidated financial statements
1 General information
Hiro Metaverse Acquisitions I S.A. (the "Company") was
incorporated on 20 September 2021 (date of incorporation as per the
deed of incorporation agreed between shareholders in front of the
notary) as a public limited liability company in Luxembourg
(Société Anonyme or "S.A.") under the laws of the Grand Duchy of
Luxembourg for an unlimited period. The Company is registered with
the Luxembourg Trade and Companies Register (Registre de Commerce
et des Société, in abbreviated "RSC") under the number B259488
since 20 September 2021.
On the 8th of December 2021 the Company incorporated HMA1
(ESCROW) Limited (the "Subsidiary"), under the Companies Act 2006 ,
in the United Kingdome, being a private company, limited by shares,
with its registered office at 52 Lime Street, London, England.
The consolidated financial statements for the period ended 31
December 2021 covers the Company and its subsidiary (collectively
"the Group").
The share capital of the Company on 20 September 2021 was set at
GBP 30,000 (thirty thousand Pound Sterling), represented by
3,750,000 (three million seven hundred fifty thousand) Sponsor
Shares without nominal value. The Company may also issue Ordinary
Shares. The share capital has been fully paid up.
The registered office of the Company is located at 17, Boulevard
F.W. Raiffeisen, L--2411, Luxembourg. The financial year of the
Company starts on 1 January and ends on 31 December; except for the
first financial period which starts on 20 September 2021 (date of
incorporation) and ends on 31 December 2021.
The Company is managed by its Board of Directors composed of
Luke Alvarez, Cherry Freeman, Ian Livingstone as Executive
Directors and Jurgen Post, Emily Greer, and Addie Pinkster as
Non-Executive Directors (the "Board of Directors").
The sole shareholder of the Company is Hiro Sponsor I LLP (the
"Sponsor"); a limited liability partnership, incorporated and
existing under the laws of England, having its registered office
located at 18th Floor, the Scalpel, 52 Lime Street, London, EC3M
7AF, United--Kingdom, and registered with the United Kingdom's
Companies House under number OC439442.
The Company has been established for the purpose of acquiring
one operating business with principal business operations in a
member state of the European Economic Area or the United Kingdom or
Israel in the form of a merger, capital stock exchange, share
purchase, asset acquisition, reorganization or similar transaction
(the "Business Combination").
It is the intention of the Board of Directors that the Company
will undergo an initial offering (the "Placing") and be admitted to
listing on the standard listing segment of the FCA's Official List
and to trading on the London Stock Exchange's main market for
listed securities, a regulated market operated by the London Stock
Exchange PLC. The main characteristics which will be described in
the prospectus, to be approved by the United Kingdom Financial
Conduct Authority (the "FCA"), with its head office at 12 Endeavour
Square, London E20 1JN, United Kingdom, for the purpose of
admission of certain shares and warrants to the standard listing
segment of the FCA's Official List and to trading on the London
Stock Exchange's main market for listed securities.
The Company intends to seek a suitable target for the Business
Combination with a focus on targets operating in the sectors of
Video Games, Esports, Interactive Streaming, GenY Social Networks,
Connected Fitness & Wellness and Metaverse Technologies. The
Company will have 15 months from the date of the admission to
trading to consummate a Business Combination, plus an initial
three-month extension period (the "First Extension Period") and a
further three-month extension period (the "Second Extension
Period") subject in each case to approval by the Company's
shareholders. Otherwise, the Company will be liquidated and
distribute all of its assets to its shareholders, the Public shares
will be redeemed first and then the Company will be liquidated and
all remaining assets will be distributed to remaining shareholders
(Class B shareholders).
Pursuant to Article 3 of the current articles of association,
the Company's corporate purpose is the holding, management,
development and disposal of participations and any interests, in
Luxembourg or abroad, in any companies and/or enterprises in any
form whatsoever. The Company may in particular acquire by
subscription, purchase and exchange or in any other manner any
stock, shares and other participation securities, bonds,
debentures, certificates of deposit and other debt instruments and
more generally, any securities and financial instruments issued by
any public or private entity. It may participate in the creation,
development, management and control of any company and/or
enterprise. It may further invest in the acquisition and management
of a portfolio of patents or other intellectual property rights of
any nature or origin.
The Company may borrow in any form. It may issue notes, bonds
and any kind of debt and equity securities. The Company may lend
funds, including without limitation, resulting from any borrowings
of the Company and/or from the issue of any equity or debt
securities of any kind, to its Subsidiaries, affiliated companies
and/or any other companies or entities it deems fit.
The Company may further guarantee, grant security in favour of
or otherwise assist the companies in which it holds a direct or
indirect participation or which form part of the same group of
companies as the Company. The Company may further give guarantees,
pledge, transfer or encumber or otherwise create security over some
or all of its assets to guarantee its own obligations and those of
any other company, and generally for its own benefit and that of
any other company or person. For the avoidance of doubt, the
Company may not carry out any regulated activities of the financial
sector without having obtained the required authorization.
The Company may use any techniques and instruments to manage its
investments efficiently and to protect itself against credit risks,
currency exchange exposure, interest rate risks and other
risks.
The Company may, for its own account as well as for the account
of third parties, carry out any commercial, financial or industrial
operation (including, without limitation, transactions with respect
to real estate or movable property) which may be useful or
necessary to the accomplishment of its purpose or which are
directly or indirectly related to its purpose.
2 Basis of preparation and accounting policies
2.1 Basis of preparation
The group's financial year starts on 1 January and ends on 31
December of each year, with the exception of the first financial
period, which starts on 20 September 2021 (date of incorporation)
and ends on 31 December 2021.
The consolidated financial statements comprise a consolidated
statement of financial position, a consolidated statement of
comprehensive income, a consolidated statement of changes in
equity, a consolidated statement of cash flows and the accompanying
notes for the period ended 31 December 2021. These consolidated
financial statements have been prepared under the assumption that
the Group operates on a going concern basis.
These consolidated financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRS)
as adopted by the European Union for the period from 20 September
2021 (date of incorporation) to 31 December 2021 and were
authorised for issue in accordance with a resolution of the Board
of Directors on 25 April 2022.
These consolidated financial statements have been prepared in
Sterling (GPB) unless stated otherwise.
The principal accounting policies applied in the preparation of
these consolidated financial statements are set out below.
2.2 Summary of significant accounting policies
2.2.1 New or revised Standards or Interpretations
International accounting standards include IFRS, IAS
(International Accounting Standards) and their interpretations
(Standing Interpretations Committee) and IFRICs (International
Financial Reporting Interpretations Committee).
The repository adopted by the European Commission is available
on the following internet site:
http://ec.eu--ropa.eu/finance/accounting/ias/index_en.htm
(a) New standards, amendments and interpretations that were
issued but not yet applicable as at 31 December 2021 and that are
most relevant to the Company - not yet endorsed by the EU:
-- Reference to the Conceptual Framework - Amendments to IFRS 3:
In May 2020, the IASB issued Amendments to IFRS 3 Business
Combinations - Reference to the Conceptual Framework. The
amendments are intended to replace a reference to the Framework for
the Preparation and Presentation of Financial Statements, issued in
1989, with a reference to the Conceptual Framework for Financial
Reporting issued in March 2018 without significantly changing its
requirements.
-- The IASB also added an exception to the recognition principle
of IFRS 3 to avoid the issue of potential 'day 2' gains or losses
arising from liabilities and contingent liabilities that would be
within the scope of IAS 37 or IFRIC 21 Levies, if incurred
separately.
At the same time, the IASB decided to clarify existing guidance
in IFRS 3 for contingent assets that would not be affected by
replacing the reference to the Framework for the Preparation and
Presentation of Financial Statements.
The amendments are effective for annual reporting periods
beginning on or after 1 January 2022 and apply prospectively.
-- Amendments to IAS 1 -: Classification of Liabilities as
Current or Non-current. In January 2020, the IASB issued amendments
to paragraphs 69 to 76 of IAS 1 to specify the requirements for
classifying liabilities as current or non-current. The amendments
are effective for annual reporting periods beginning on or after 1
January 2023 and must be applied retrospectively.
-- Amendments to IAS 1 and IFRS Practice Statement 2: Disclosure
of Accounting policies. In February 2021, the IASB issued
amendments that are intended to help preparers in deciding which
accounting policies to disclose in their financial statements. The
amendments are effective for annual periods beginning on or after 1
January 2023.
-- Amendments to IAS 8: Definition of Accounting Estimate. In
February 2021 , the IASB issued amendments to help entities to
distinguish between accounting policies and accounting estimates.
The amendments are effective for annual periods beginning on or
after 1 January 2023.
-- Amendments to IAS 12 - not yet endorsed by the EU: Deferred
Tax related to Assets and Liabilities arising from a Single
Transaction. In May 2021, the IASB amended the standard to reduce
diversity in the way that entities account for deferred tax on
transactions and events, such as leases and decommissioning
obligations, that lead to the initial recognition of both an asset
and a liability. The amendments apply for annual reporting periods
beginning on or after 1 January 2023 and may be applied early.
-- Amendments to IAS 37: Onerous Contracts - Cost of Fulfilling
a Contract. The amendments specify that the 'cost of fulfilling' a
contract comprises the 'costs that relate directly to the
contract'. Costs that relate directly to a contract can either be
incremental costs of fulfilling that contract (examples would be
direct labour, materials) or an allocation of other costs that
relate directly to fulfilling contracts (an example would be the
allocation of the depreciation charge for an item of property,
plant and equipment used in fulfilling the contract). The
amendments are effective for annual reporting periods beginning on
or after 1 January 2022 with earlier application permitted.
-- Annual improvements to IFRS Standards 2018-2020 : The annual
improvements to IFRS consists of amendments to IFRS 1, IFRS 9, IFRS
16, and IAS 41. The amendments are effective for annual reporting
periods beginning on or after 1 January 2022 with earlier
application permitted.
The initial application of these standards, interpretations, and
amendments to existing standards is planned for the period of time
from when its application becomes compulsory. Currently, the Board
of Directors anticipates that the adoption of these Standards and
Interpretations in future periods will have no material impact on
the financial information of the Group.
2.2.2 Basis for of consolidation
Subsidiaries
Subsidiaries included in these consolidated financial statements
are all entities over which the Company has direct or indirect
control. The Group controls such an entity when it is exposed to,
or has substantive rights to, variable returns from its involvement
with the Group and has the ability to affect those returns through
its power to direct the activities of the entities. Subsidiaries
are fully consolidated from the date on which control is
transferred to the Company until the date on which control
ceases.
Intercompany transactions, outstanding balances, and unrealised
gains on transactions between Group companies are eliminated.
Unrealised losses are also eliminated unless the transaction
provides evidence of an impairment of the transferred asset.
Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with the policies adopted by the
Group.
Non-controlling interests in the net result/(loss) and equity of
the subsidiaries are shown separately in the consolidated statement
of financial position, consolidated statement of comprehensive
income and consolidated statement of changes in equity
2.2.3 Foreign currencies
Functional and presentation currency
Items included in the financial statements of each of the
Group's entities are measured using the curren-cy of the primary
economic environment in which the entity operates ("the functional
currency"). The consolidated financial statements are presented in
Sterling (GBP).
Foreign currency transactions and balances
In preparing these consolidated financial statements of the
Group, transactions in currencies other than the entity's
functional currency (foreign currencies) are recognised at the
rates of exchange prevailing on the dates of the transactions. At
each reporting date, monetary assets and liabilities that are
denominated in foreign currencies are retranslated at the rates
prevailing at that date. Non--monetary items carried at fair value
that are denominated in foreign currencies are translated at the
rates prevailing at the date when the fair value was determined.
Nonmonetary items that are measured in terms of historical cost in
a foreign currency are not retranslated.
Exchange differences are recognised in profit or loss in the
year in which they arise except for exchange differences on
monetary items related to deferred costs included in trade
payables; which are recognised directly in deferred cost.
2.2.4 Financial instruments
A financial instrument is any contract that gives rise to a
financial asset of one entity and a financial liability or equity
instrument of another entity. The Group recognises a financial
asset or a financial liability when it becomes a party to the
contractual provisions of the instrument. Purchases or sales of
financial assets that require delivery of assets within the time
frame generally established by regulation or convention in the
marketplace (regular way trades) are recognised on the trade date
i.e. the date that the Group commits to purchase or sell the
asset.
Recognition and derecognition
Financial assets and financial liabilities are recognised when
the Group becomes a party to the contractual provisions of the
financial instrument.
Financial assets are derecognised when the contractual rights to
the cash flows from the financial asset expire, or when the
financial asset and substantially all the risks and rewards are
transferred.
A financial liability is derecognised when it is extinguished,
discharged, cancelled or expires. When an existing financial
liability is replaced by another from the same lender on
substantially different terms, or the terms of an existing
liability are substantially modified, such an exchange or
modification is treated as the derecognition of the original
liability and the recognition of new liability. The difference in
the respective carrying account is recognised in the statement of
profit or loss.
Classification and initial measurement of financial assets
All financial assets are initially measured at fair value
adjusted for transaction costs (where applicable).
Financial assets are classified into one of the following
categories:
-- amortised cost
-- fair value through profit or loss (FVTPL), or
-- fair value through other comprehensive income (FVOCI).
In the period presented the Group includes cash and cash
equivalents in the category Financial assets held at amortised
costs.
In the period presented the Group does not have any financial
assets categorised as FVTPL.
In the period presented the Group does not have any financial
assets categorised as FVOCI.
The classification is determined by both:
-- the entity's business model for managing the financial asset, and
-- the contractual cash flow characteristics of the financial asset.
All revenue and expenses relating to financial assets that are
recognised in profit or loss are presented within finance costs,
finance income or other financial items, except for impairment of
trade receivables which is presented within other expenses.
Subsequent measurement of financial assets
Financial assets are measured at amortised cost if the assets
meet the following conditions and are not designated as FVTPL:
-- they are held within a business model whose objective is to
hold the financial assets and collect its contractual cash flows,
and
-- the contractual terms of the financial assets give rise to
cash flows that are solely payments of principal and interest on
the principal amount outstanding.
After initial recognition, these are measured at amortised cost
using the effective interest method (EIR). Discounting is omitted
where the effect of discounting is immaterial.
Impairment of financial assets
IFRS 9's impairment requirements use forward--looking
information to recognise expected credit losses - the 'expected
credit loss (ECL) model'. Instruments within the scope of the
requirements included loans and some financial guarantee contracts
(for the issuer) that are not measured at fair value through profit
or loss.
The Group considers a broader range of information when
assessing credit risk and measuring expected credit losses,
including past events, current conditions, reasonable and
supportable forecasts that affect the expected collectability of
the future cash flows of the instrument.
In applying this forward--looking approach, a distinction is
made between:
-- financial instruments that have not deteriorated
significantly in credit quality since initial recognition or that
have low credit risk ('Stage 1').
-- financial instruments that have deteriorated significantly in
credit quality since initial recognition and whose credit risk is
not low ('Stage 2').
-- 'Stage 3' would cover financial assets that have objective
evidence of impairment at the reporting date.
Measurement of the expected credit losses is determined by a
probability--weighted estimate of credit losses over the expected
life of the financial instrument.
Classification and measurement of financial liabilities
The financial liabilities are classified, at initial
recognition, as financial liabilities at fair value through profit
or loss or financial liabilities at amortised cost. The Group's
financial liabilities carried at amortised costs include borrowings
and trade and other payables.
Financial liabilities are initially measured at fair value, and,
where applicable, adjusted for transaction costs unless the Group
designated a financial liability at fair value through profit or
loss.
Financial liabilities recognised at amortised cost are
subsequently measured, using the effective interest method.
All interest--related charges and, if applicable, changes in an
instrument's fair value that are reported in profit or loss are
included within finance costs or finance income.
Offsetting financial instruments
Financial instruments are offset and a net amount reported in
the statement of financial position only when there is currently a
legally enforceable right to offset the recognised amounts and
there is an intention to settle on a net basis, or realise the
asset and settle the liability simultaneously.
2.2.5 Cash and cash equivalents
Cash and cash equivalents in the statement of financial position
comprise cash at banks and on hand and short term, highly liquid
deposits with a maturity of three months or less, that are readily
convertible to a known amount of cash and subject to an
insignificant risk of changes in value. The carrying amounts of
these approximate their fair value.
For the purpose of the financial statement of cash flows, cash
and cash equivalents consist of cash and short term deposits, as
defined above, net of outstanding bank overdrafts as they are
considered an integral part of the Group's cash management.
2.2.6 Fair value measurement
Fair value is the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. The fair value
measurement is based on the presumption that the transaction to
sell the asset or transfer the liability takes place either:
-- In the principal market for the asset or liability; or
-- In the absence of a principal market, in the most
advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible
by the Group.
The fair value of an asset or a liability is measured using the
assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their
economic best interest.
A fair value measurement of a non--financial asset takes into
account a market participant's ability to generate economic
benefits by using the asset in its highest and best use or by
selling it to another market participant that would use the asset
in its highest and best use.
The Group uses valuation techniques that are appropriate in the
circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable
inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or
disclosed in the consolidated financial statements are categorised
within the fair value hierarchy, described as follows, based on the
lowest level input that is significant to the fair value
measurement as a whole:
-- Level 1 -- Quoted (unadjusted) market prices in active
markets for identical assets or liabilities;
-- Level 2 -- Valuation techniques for which the lowest level
input that is significant to the fair value measurement is directly
or indirectly observable;
-- Level 3 -- Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.
2.2.7 Provisions and contingent liabilities
Provisions are recognised when the Group has a present
obligation (legal or constructive) as a result of a past event, it
is probable that an outflow of economic resources will be required
from the Group and a reliable estimate can be made of the amount of
the obligation. The timing or amount of the outflow may still be
uncertain.
Provisions are not recognised for future operating losses.
Provisions are measured at the estimated expenditure required to
settle the present obligation, based on the most reliable evidence
available at the reporting date, including the risks and
uncertainties associated with the present obligation. Where there
are a number of similar obligations, the likelihood that an outflow
will be required in settlement is determined by considering the
class of obligations as a whole.
If the effect of the time value of money is material, provisions
are discounted using a current pre--tax rate that reflects, when
appropriate, the risks specific to the liability. When discounting
is used, the increase in the provision due to the passage of time
is recognised as a finance cost.
Any reimbursement that the Group is virtually certain to collect
from a third party with respect to the obligation is recognised as
a separate asset. However, this asset may not exceed the amount of
the related provision.
No liability is recognised if an outflow of economic resources
as a result of present obligations is not probable. Such situations
are disclosed as contingent liabilities unless the outflow of
resources is remote.
2.2.8 Other payables and accrued expenses
Other payables and accrued expenses are obligations to pay for
services that have been or will be acquired in the ordinary course
of business from suppliers. They are classified as current
liabilities if payment is due within twelve months after statement
of financial position date. If not, they are represented as
non--current liabilities. Other payables and accrued expenses are
recognised initially at fair value and subsequently stated at
amortised costs. The difference between the proceeds and the amount
payable is recognised over the period of the payable using the
effective interest method.
2.2.9 Taxation
Income tax recognized in the statement of profit or loss and
other comprehensive income includes current and deferred taxes.
Current tax
Current income tax assets and liabilities are measured at the
amount expected to be recovered from or paid to the taxation
authorities. The tax rates and tax laws used to compute the amount
are those that are enacted or substantively enacted at the
reporting date in the countries where the Group operates and
generates taxable income.
Current and deferred tax are recognised in profit or loss,
except when they relate to items that are recognised in other
comprehensive income or directly in equity, in which case, the
current and deferred tax are also recognised in other comprehensive
income or directly in equity respectively. Where current tax or
deferred tax arises from the initial accounting for a business
combination, the tax effect is included in the accounting for the
business combination.
Deferred tax
Deferred tax is recognized on temporary differences between the
carrying amounts of assets and liabilities in the consolidated
financial statements and the corresponding tax bases used in the
computation of taxable profit.
Deferred tax liabilities are generally recognized for all
taxable temporary differences. Deferred tax assets are generally
recognized for all deductible temporary differences to the extent
that it is probable that taxable profits will be available against
which those deductible temporary differences can be utilized. This
is assessed based on the Group's forecast of future operating
results, adjusted for significant non--taxable income and expenses
and specific limits on the use of Deferred tax liabilities are
generally recognised in full, although IAS 12 specifies limited
exemptions.
The carrying amounts of deferred tax are reviewed at the end of
each reporting period and adjusted if needed.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the Group intends to settle its
current tax assets and liabilities on a net basis.
2.2.10 Current versus non-current classification
The Group presents assets and liabilities in statement of
financial position based on current/non--current
classification.
An asset is current when it is:
-- expected to be realised or intended to be sold or be consumed
in normal operating cycle;
-- held primarily for the purpose of trading;
-- expected to be realised within twelve months after the reporting period; or
-- cash or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least twelve months
after the reporting period.
All other assets are classified as non-current.
A liability is current when:
-- it is expected to be settled in normal operating cycle;
-- it is held primarily for the purpose of trading;
-- it is due to be settled within twelve months after the reporting period; or
-- there is no unconditional right to defer the settlement of
the liability for at least twelve months after the reporting
period.
All other liabilities are classified as non--current.
2.2.11 Operating expenses
Operating expenses are recognised in profit or loss upon
utilisation of the service or as incurred.
3 Significant accounting judgements, estimates and assumptions
The preparation of these consolidated financial statements in
conformity with IFRS requires management to make judgements,
estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities, income
and expenses.
Actual results and outcomes may differ from management's
estimates and assumptions due to risks and uncertainties, including
uncertainty in the current economic environment due to the ongoing
outbreak of a novel strain of the coronavirus ("COVID --1 9")
In December 2019, a COVID --1 9 outbreak was reported in China,
and, in March 2020, the World Health Organization declared it a
pandemic. Since being initially reported in China, the coronavirus
has spread to over 150 countries.
Given the ongoing and dynamic nature of the COVID --1 9 crisis,
it is difficult to predict the impact on the business of potential
targets. The extent of such impact will depend on future
developments, which are highly uncertain and cannot be predicted,
including new information which may emerge concerning the severity
of the coronavirus and actions taken to contain the coronavirus or
its impact, among others. The ongoing COVID --1 9 pandemic, the
increased market volatility and the potential unavailability of
third--party financing caused by the COVID --1 9 pandemic as well
as restrictions on travel and in--person meetings, which may hinder
the due diligence process and negotiations, may also delay and/or
adversely affect the Business Combination or make it more
costly.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimates are revised and in any future periods
affected.
As at 31 December 2021, the significant areas of estimation,
uncertainty and critical judgements in applying accounting policies
that have the most significant effect on the amounts recognised in
these consolidated financial statements are:
-- Going concern: Judgement on going concern consideration. The
Board of Directors' underlying assumption to prepare the
consolidated financial statements is based on the anticipated
successful completion of the Placing. As required by art. 480--2 of
the Luxembourg law of 10 August 1915 (as amended) the Board of
Directors of the Company plans to present a business continuity
plan to the shareholders. On 19 January 2022 the Company entered
into a loan agreement with the Sponsor for the purpose of settling
its creditors and other costs which become due in the ordinary
course of business, should the Placing for any reason not be
successful. (Note 14.3)
-- Deferred costs: According to the Board of Directors'
underlying assumption of a successful admission to the regulated
market of the London Stock Exchange, the related amounts incurred
as transaction costs as of 31 December 2021 that qualify as
incremental costs directly attributable to the Placing are deferred
until the effects of the Placing are reflected in the accounts, and
reported as deferred costs in the consolidated financial statements
as of that date. These deferred costs will be deducted from the
proceeds of the planned Placing, which occurred on the 2(nd) of
February 2022.
4 Financial risk management, objectives and policies
The Group is newly formed and has not conducted any operations
and currently generates no revenue. The Group does not have
material foreign currency transactions. Hence, currently the Group
does not face foreign currency risks nor any interest rate risks as
the financial instruments of the Group bear a fixed interest
rate.
Liquidity risks
Liquidity risk is the risk that the Group will encounter
difficulty in meeting its financial obligations as they fall due.
If the Placing contemplated by the Company is completed, 100% of
the gross proceeds of this Placing will be deposited in a secured
deposit account. The amount held in the secured deposit account
will only be released in connection with the completion of the
Business Combination or the Company's liquidation. Following the
completion of the Placing, the Board of Directors believes that the
funds available to the Group outside of the secured deposit
account, together with the available shareholder loan will be
sufficient to pay costs and expenses which are incurred by the
Group prior to the completion of the Business Combination.
The objective of the Sponsor Warrants issued to the Sponsor at
the time of the Placing, is to use the proceeds to pay the various
costs and expenses incurred and contracted for as disclosed in the
Consolidated Financial Statements, except the underwriting
commission. The proceeds of the Placing of Public Shares will not
be used to pay these expenses.
The Sponsor is committing additional funds to the Company
through the Overfunding Subscription, the proceeds of which will be
held in an escrow account. The purpose of the overfunding
subscription is to provide additional cash funding into the Escrow
Account, in addition to the funding from the proceeds of the Units
sold in the Placing, for the redemption of the Public Shares by
Public Shareholders ("Initial Overfunding Shares").
The Initial Overfunding Shares and Initial Overfunding Warrants
are not part of the Placing but will be part of the applications
for Shares Admissions and Warrants Admission.
To the extent that the Business Combination Deadline is
extended, the Sponsor will commit further additional funds to the
Company through the subscription of additional units as referred to
in Part VIII. 4 of the Prospectus.
Capital management
The Board of Directors' policy is to maintain a strong capital
base so as to maintain investor, creditor, and market confidence
and to sustain future development of the business. In order to meet
the capital management objective described above, the Company
intends to raise funds through a Placing reserved to certain
qualified investors inside and outside of the United Kingdom, and
to have the public shares and public warrants to be issued in such
Placing admitted to listing and trading on the regulated market
segment of London Stock Exchange in the near future. The
above--mentioned financial instruments to be issued as part of this
Placing will represent what the entity will manage as capital.
Credit risk
Credit risk is the risk that a counterparty will not meet its
obligations under a financial instrument or customer contract,
leading to a financial loss. The Group is currently exposed to
credit risk from its deposit with banks.
5 Other operating expenses
The other operating expenses of GBP 152,560 consist of fees for
accounting, legal, and other services not related to the
Placing.
20 Sept 2021
to
31 Dec 2021
-------------
GBP
Accounting, tax consulting, auditing and similar
fees....................................................................... 151,407
Notarial and similar
fees.................................................................................................
........................ 1,153
Other operating
expenses.............................................................................................
........................... 152,560
=============
6 Income Tax
20 Sept 2021
to
31 Dec 2021
-------------
GBP
Loss for the period before
tax..................................................................................................
.............. 152,288
Theoretical tax charges, applying the tax rate of
22.8%.................................................................. (34,722)
Tax effect of adjustments from Luxembourg GAAP to
IFRS........................................................ (166,761)
Unrecognised deferred tax
asset................................................................................................
............ 201,783
Income Tax --
=============
Income tax
The tax rate used in reconciliation above is the Luxembourgish
tax rate (22.8%) as the Company is domiciled in the Grand Duchy of
Luxembourg. The Subsidiary did not generate any result for the
period.
Deferred tax
Deferred tax assets have not been recognised in respect of the
loss incurred during the period ended 31 December 2021 because it
is not probable that future taxable profit will be available
against which the Group can utilise the benefits therefrom. Unused
tax losses of the Group can be used within a period of 17 years as
per Luxembourg tax law.
7 Earnings /(loss) per share
Basic earnings/(loss) per share ("EPS") is calculated by
dividing the profit/(loss) for the year attributable to ordinary
equity holders of the Group by the weighted average number of
ordinary shares outstanding during the period.
Diluted EPS is calculated by dividing the profit/(loss)
attributable to ordinary equity holders of the Group by the
weighted average number of ordinary shares outstanding during the
year plus the weighted average number of ordinary shares that would
be issued on conversion of all the dilutive potential ordinary
shares into ordinary shares.
Currently, no other diluting instruments have been issued.
Therefore, basic EPS equals diluted EPS as at 31 December 2021.
8 Deferred costs
Deferred costs of GBP 731,407 as at 31 December 2021 are
composed mainly of legal and administration costs incurred by the
Company in relation to the public offering which will be offset
against the proceeds from the planned Placing.
Other Placing related costs which have not been incurred relate
to the underwriter fees, legal fees for the underwriter and escrow,
exchange, regulatory, and listing fees. These costs once incurred
will also be deducted from the proceeds of the Placing
9 Cash and cash equivalents
The amount of cash and cash equivalents was GBP 30,000 as at 31
December 2021.
10 Issued capital and reserves
Share capital
As at 31 December 2021, the subscribed share capital amounts to
GBP 30,000 consisting of 3,750,000 shares without nominal value
held by the Sponsor, hereinafter referred to as the "Sponsor
Shares". The Company's share capital may be increased or reduced by
a resolution of the general meeting of shareholders adopted in the
manner required for an amendment for the articles of
association.
On 26 January 2022, the issued capital shares was reduced from
3,750,000 to 2,875,000 through a forfeiture of 875,000 Sponsor
Shares at a nil cost.
It is planned that the Sponsor Shares shall convert into Public
Shares subject to a certain schedule and trading price following
the consummation of the Business Combination. The Sponsor Shares
will convert into a number of Public Shares such that the number of
Public Shares issuable to the Sponsor upon conversion of all
Sponsor Shares will be equal, in the aggregate, on an as--converted
basis, to 20% of the total ordinary shares in issue following the
Placing. The Placing took place on 2 February 2022, refer to note
14.4 for detailed information of the effect of the placing on the
Share capital and 15.5 on the Warrants at reporting date.
Authorised capital
As at 31 December 2021, the authorized capital of the Company is
set at GBP 1,000,000 consisting of 100,000,000 shares without
nominal value.
Legal reserves
The Company is required to allocate a minimum of 5% of its
annual net profit to a legal reserve, until this reserve equals 10%
of the subscribed share capital. This reserve may not be
distributed.
11 Trade and other payables
31 Dec2021
------------
GBP
Accounting, tax consulting, auditing and similar
fees....................................................................... 151,135
Deferred
costs.................................................................................................
.......................................... 731,407
Notarial and similar
fees..................................................................................................
....................... 1,153
Trade and other payables 893,695
============
Trade and other payables are related to legal and other services
received by the Group. The carrying amounts of these approximate
their fair value.
12 Related party disclosures
Parties are considered to be related if one party has the
ability to control the other party or exercise significant
influence over the other party in making financial or operational
decisions.
Terms and conditions of transactions with related parties
There have been no guarantees provided or received for any
related party receivables or payables as at 31 December 2021.
Please refer to note 14.3 regarding the Shareholders loan put in
place subsequent to 31 December 2021.
Transactions with key management personnel
There are no advances or loans granted to members of the Board
of Directors as at 31 December 2021.
The Board of Directors consists of 6 members who did not receive
any remuneration during the period ended 31 December 2021.
The Company entered into contracts with the non--executive
directors which will be effective from the date of the Placing. The
agreed directors fees are GBP 10,000 per annum; to be paid
semi--annually in arrears in equal instalments after deduction of
any taxes and other amounts that are required by law. In addition
to the directors fee the Company will procure that the Sponsor
transfers 25,000 Sponsor Shares in the Company held by the Sponsor
to the non--executive directors.
13 Commitments and contingencies
In the context of the planned Placing, the Company entered into
or is contemplating to enter into respective contracts with
different providers, the total costs of which is estimated at
approximately GBP 1,200,000 (excluding underwriting commission fees
and the costs recorded as deferred costs). After the Placing, the
Company expects to incur expenses as a result of being a publicly
listed company (for legal, financial reporting, accounting and
auditing compliance). The Company cannot estimate expenses incurred
in connection with researching targets, the investigation of
potential target businesses and the negotiation, drafting and
execution of the transaction documents appropriate for the Initial
Business Combination, as the amounts will depend on the specific
circumstances of the Initial Business Combination.
The Group has no other commitments and contingencies as at 31
December 2021.
14 Events after statement of financial position date
No events occurred after the reporting period which requires
amendment to or disclosure in the consolidated financial
statements, except from those disclosed below.
14.1 Impact of the COVID-19 pandemic
As a result of the COVID-- 1 9 pandemic business operations
worldwide have been impacted in various ways. The COVID --1 9
pandemic may continue to impact the business operations and the
intended Placing and Business Combination processes. There is
uncertainty in the nature and degree of its continued effects over
time.
14.2 Underwriting agreement
The Company entered into an agreement with Citigroup Global
Markets Limited (Underwriting Agreement), by virtue of which the
Company will be liable to pay Upfront Commission Fees of 2% of the
aggregate gross proceeds of the Securities, payable at closing of
the offering; and a deferred commission equal to 3.5% of the
aggregate gross proceeds of the Securities, subject to completion
of Business Combination and payable after such completion.
Commissions are not payable on Securities issued to certain
Investors; subject to a maximum allocated amount of the greater of
either GBP 32.5 million or 15% of the Offering.
14.3 Shareholders loan
On 19 January 2022, the Company entered into a loan agreement
with the Sponsor for the purpose of settling its creditors and
other costs which become due in the ordinary course of business,
should the Placing for any reason not be successful. At reporting
date no amount was drawn. The Placing took place on 2 February
2022.The loan shall be available to the Company up until
consummation of the Business Combination or the liquidation of the
Company.
14.4 Listing on London Stock Exchange
On 2 February 2022 the Company's Prospectus was approved and
published on the London Stock Exchange.
In terms of the Sponsor Private Placement Agreement; on 2
February 2022, the Sponsor subscribed to 310,500 Overfunding shares
at GBP10 per share, and 5,070,000 Class B Sponsor Warrants at GBP1
per warrant, raising capital in the amount of GBP 8,175,000.
On 7 February 2022, 11,500,000 of the Company's Public Shares
were admitted to the standard listing segment of the Official List
of the Financial Conduct Authority and to trading on the London
Stock Exchange's main market for listed securities under ticker
"HMA1", raising capital in the amount of GBP 115,000,000.
On 7 February 2022 Citigroup Global Markets Limited, acting as
stabilising manager, gave notice on of its non-exercise of the put
option granted by the Company.
On 8 February 2022 the Sponsor subscribed for a further 34,500
Shares cum Rights at a price of GBP 10.00 per share, (the
"Overfunding Shares Subscription"). The non-exercise of the Put
Option and the Overfunding Shares Subscription brings the total
number of Shares cum Rights in issue at 11,845,000.
The total number of voting rights in the Company following the
Overfunding Subscription is 14,720,000. This including the
2,8750,000 unlisted class B ordinary shares with no par value held
by the Sponsor.
14.5 Warrants Admission to Trading on the London Stock Exchange
On 8 February 2022 the Company published its notice on the stock
exchange that it intends to accelerate the proposed issue and
admission of the Public Warrants as follows:
- Warrants Ex Date 22 February 2022
- Warrants Record Date 6.00 p.m. on 23 February 2022
- Warrants Admission Date 8.00 a.m. on 24 February 2022
On 8 February 2022, the Sponsor, in terms of the Sponsor Private
Placement Agreement; subscribed for a further 230,000 Sponsor
Warrants at GBP1 per warrant.
On 24 February 2022, the Company admitted 5,922,500 Public
Warrants to the standard listing segment of the Official List of
the Financial Conduct Authority and to trading on the London Stock
Exchange's main market for listed securities under ticker
"HM1W".
14.6 Subscription of shares in HMA1 (Escrow) Limited
On 11 February 2022, the Company subscribed for 11,845,000
ordinary shares in HMA1 at nominal value of GBP 1 per share. HMA1
issued the shares and the consideration was fully paid up by the
Company on the 15(th) of February 2022.
14.7 Geopolitical Situation
Management considered the effects of the invasion of Ukraine by
Russia and it has no impact on the Group and consequently does not
affect the measurement of Group's assets and liabilities as at 31
December 2021.
To the Shareholders of
HIRO METAVERSE ACQUISITIONS I S.A.
Société Anonyme
R.C.S. Luxembourg B 259.488
17, Boulevard Raiffeisen
L-2411 Luxembourg
REPORT OF THE REVISEUR D'ENTREPRISES AGREE
Report on the Audit of the Separate Financial Statements
Opinion
We have audited the separate financial statements (the
"financial statements") of HIRO METAVERSE ACQUISITIONS I SA (the
"Company"), which comprise the statement of financial position as
of 31 December 2021, and the statement of comprehensive income,
statement of changes in equity and statement of cash-flows for the
period from 20 September 2021 (date of incorporation) to 31
December 2021, and notes to the financial statements, including a
summary of significant accounting policies.
In our opinion, the accompanying financial statements give a
true and fair view of the financial position of the Company as of
31 December 2021, and of its financial performance and its cash
flows for the period from 20 September 2021 (date of incorporation)
to 31 December 2021 in accordance with International Financial
Reporting Standards ("IFRS") as adopted by the European Union.
Basis for Opinion
We conducted our audit in accordance with the EU Regulation Ndeg
537/2014, the Law of 23 July 2016 on the audit profession ("Law of
23 July 2016") and with International Standards on Auditing
("ISAs") as adopted for Luxembourg by the "Commission de
Surveillance du Secteur Financier" ("CSSF"). Our responsibilities
under the EU regulation No 537/2014, the Law of 23 July 2016 and
ISAs as adopted for Luxembourg by the CSSF are further described in
the << Responsibilities of the "réviseur d'entreprises agréé"
for the Audit of the Financial Statements >> section of our
report. We are also independent of the Company in accordance with
the International Code of Ethics for Professional Accountants,
including International Independence Standards, issued by the
International Ethics Standards Board for Accountants (IESBA Code)
as adopted for Luxembourg by the CSSF together with the ethical
requirements that are relevant to our audit of the financial
statements, and have fulfilled our other ethical responsibilities
under those ethical requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Key Audit Matters
Key Audit Matters are those matters that, in our professional
judgment, were of most significance in our audit of the financial
statements of the current period. These matters were addressed in
the context of the audit of the financial statements as a whole,
and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
Based on the result of our audit procedures no Key Audit Matters
were identified for the audit of the financial statements as of 31
December 2021.
Other information
The Board of Directors is responsible for the other information.
The other information comprises the information stated in the
Directors Report including the Corporate Governance Statement but
does not include the financial statements and our report of the
"réviseur d'entreprises agréé" thereon.
Our opinion on the financial statements does not cover the other
information and we do not express any form of assurance conclusion
thereon.
In connection with our audit of the financial statements, our
responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If, based on
the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report
this fact.
We have nothing to report in this regard.
Responsibilities of the Board of Directors and Those Charged
with Governance of the Company for the Financial Statements
The Board of Directors of the Company is responsible for the
preparation and fair presentation of the financial statements in
accordance with IFRSs as adopted by the European Union and for such
internal control as the Board of Directors of the Company
determines is necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to
fraud or error.
The Board of Directors is also responsible for presenting the
financial statements in compliance with the requirements set out in
the Delegated Regulation 2019/815 on European Single Electronic
Format, as amended ("ESEF Regulation").
In preparing the financial statements, the Board of Directors of
the Company is responsible for assessing the Company's ability to
continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of
accounting unless the Board of Directors either intends to
liquidate the Company or to cease operations, or has no realistic
alternative but to do so.
Those charged with governance are responsible for overseeing the
Company's financial reporting process.
Responsibilities of the "Réviseur d'Entreprises Agréé" for the
Audit of the financial statements
The objectives of our audit are to obtain reasonable assurance
about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue
a report of the "Réviseur d'Entreprises Agréé" that includes our
opinion. Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance with
accordance with the EU Regulation Ndeg 537/2014, the Law of 23 July
2016 and with ISAs as adopted for Luxembourg by the CSSF will
always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected
to influence the economic decisions of users taken on the basis of
these financial statements.
As part of an audit in accordance with the EU Regulation Ndeg
537/2014, the Law of 23 July 2016 and with ISAs as adopted for
Luxembourg by the CSSF, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
-- Identify and assess the risks of material misstatement of the
financial statements, whether due to fraud or error, design and
perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal
control.
-- Obtain an understanding of internal control relevant to the
audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Company's internal control.
-- Evaluate the appropriateness of accounting policies used and
the reasonableness of accounting estimates and related disclosures
made by the Board of Directors of the Company.
-- Conclude on the appropriateness of Board of Directors of the
Company's use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant
doubt on the Company's ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to
draw attention in our report of the "Réviseur d'Entreprises Agréé"
to the related disclosures in the financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our
report of the "Réviseur d'Entreprises Agréé". However, future
events or conditions may cause the Company to cease to continue as
a going concern.
-- Evaluate the overall presentation, structure and content of
the financial statements, including the disclosures, and whether
the financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
-- Assess whether the financial statements have been prepared,
in all material respects, in compliance with the requirements laid
down in the ESEF Regulation.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies
in internal control that we identify during our audit.
We also provide those charged with governance with a statement
that we have complied with relevant ethical requirements regarding
independence, and communicate to them all relationships and other
matters that may reasonably be thought to bear on our independence,
and where applicable, actions taken to eliminate threats or
safeguards applied.
From the matters communicated with those charged with
governance, we determine those matters that were of most
significance in the audit of the financial statements of the
current period and are therefore the key audit matters. We describe
these matters in our report unless law or regulation precludes
public disclosure about the matter.
Report on Other Legal and Regulatory Requirements
We have been appointed as "réviseur d'entreprises agréé" on 20
September 2021 and the duration of our uninterrupted engagement,
including previous renewals and reappointments, is 1 year.
The Directors report is consistent with the financial statements
and has been prepared in accordance with applicable legal
requirements.
We have checked the compliance of the financial statements of
the Company as at 31 December 2021 with relevant statutory
requirements set out in the ESEF Regulation that are applicable to
the financial statements. For the Company, it relates to financial
statements prepared in valid xHTML format.
In our opinion, the financial statements of the Company as at 31
December 2021, identified as 222100X27S5HMALJTB53-2021-12-31, have
been prepared, in all material respects, in compliance with the
requirements laid down in the ESEF Regulation.
We confirm that the audit opinion is consistent with the
additional report to the audit committee.
We confirm that the prohibited non-audit services referred to in
EU Regulation No 537/2014 were not provided and that we remained
independent of the Company in conducting the audit.
Luxembourg, 27 April 2022
For Mazars Luxembourg, Cabinet de révision agréé
5, rue Guillaume J. Kroll
L-1882 Luxembourg
Nadhmi AMOURI
Réviseur d'entreprises agréé
Statement of comprehensive income for the period from 20
September 2021 to
31 December 2021
20 Sept 2021
to
Note 31 Dec 2021
----- -------------
GBP
Revenue........................................................................................
............................ --
Other operating
expenses...................................................................................... 5 (152,560)
Taxes, duties and similar
expenses...................................................................... 6 --
Operating
(loss)/profit.................................................................................
........ (152,560)
Finance
income.........................................................................................
.............. --
Finance
costs..........................................................................................
................. --
Foreign currency exchange
gains/(losses)........................................................... 272
Loss before income
tax........................................................................................ (152,288)
Income
tax............................................................................................
................... 6 --
Profit/(loss) for the
period.................................................................................. (152,288)
Other comprehensive
income............................................................................. --
Total comprehensive income/(loss) for the period, net of tax.................... (152,288)
=============
Earnings/(loss) per share attributable to equity holders
Net earnings per
share......................................................................................... 7
(0.04)
The accompanying notes form an integral part of these financial
statements
Statement of financial position as at 31 December 2021
Assets Notes 31 Dec 2021
------------------------------------------------------------------------------------------------ ------ ------------
GBP
Financial assets at fair value through profit or loss 8 1
Current assets
Deferred
costs.........................................................................................
.................. 9 731,407
Trade and other
receivables................................................................................... -
Cash and cash
equivalents...................................................................................
.. 10 30,000
------------
Current
assets........................................................................................
.................. 761,407
Total Assets 761,408
============
Equity and liabilities
Equity
Share
capital.......................................................................................
...................... 11 30,000
Accumulated
deficit.......................................................................................
......... (152,288)
------------
(122,288)
Liabilities
Current liabilities
Trade and other
payables......................................................................................
. 12 883,696
Taxes
payable........................................................................................
.................. 6 --
------------
Total current
liabilities...................................................................................
...... 883,696
Total
liabilities...................................................................................
..................... 883,696
Total equity and
liabilities................................................................................... 761,408
============
The accompanying notes form an integral part of these separate
financial statements
Statement of changes in equity for the period ended 31 December
2021
Notes Share capital Accumulated deficit Total equity
------ -------------- -------------------- -------------
GBP GBP GBP
Issuance of incorporation capital........... 10 30,000 -- 30,000
Loss for the period..................................... -- (152,288) (152,288)
Other comprehensive income.................. -- -- --
Balance at 31 December 2021.............. 30,000 (152,288) (122,288)
============== ==================== =============
The accompanying notes form an integral part of these separate
financial statements.
Statement of cash flows for the for the period 20 September 2021
to 31 December 2021
20 Sept 2021
to
31 Dec 2021
-------------
GBP
Cash flow from operating activities
Loss before income
tax..................................................................................................
.................. (152,288)
Adjustments for:
* Finance
income...............................................
.....................................................
.......................... --
* Finance
expense..............................................
.....................................................
.......................... --
-------------
Net cash from operating activities before income
tax............................................................ (152,288)
Changes in working capital:
* Increase in deferred
costs................................................
.....................................................
........ (731,407)
* Increase in trade and other
payables.............................................
............................................ 838,696
-------------
Net cash flows from operating
activities.................................................................................... --
-------------
Cash flow from financing activities
Proceeds from issue of ordinary
shares......................................................................................... 30,000
Net cash flows from financing
activities.................................................................................... 30,000
-------------
Net change in cash and cash
equivalents..................................................................................... 30,000
Cash and cash equivalents,
beginning........................................................................................... --
-------------
Cash and cash equivalents at the end of the
period................................................................. 30,000
=============
The accompanying notes form an integral part of these separate
financial statements
15 General information
Hiro Metaverse Acquisitions I S.A. (the "Company") was
incorporated on 20 September 2021 (date of incorporation as per the
deed of incorporation agreed between shareholders in front of the
notary) as a public limited liability company in Luxembourg
(Société Anonyme or "S.A.") under the laws of the Grand Duchy of
Luxembourg for an unlimited period. The Company is registered with
the Luxembourg Trade and Companies Register (Registre de Commerce
et des Société, in abbreviated "RSC") under the number B259488
since 20 September 2021.
On the 8th of December 2021 the Company incorporated HMA1
(ESCROW) Limited (the "Subsidiary"), under the Companies Act 2006 ,
in the United Kingdome, being a private company, limited by shares,
with its registered office at 52 Lime Street, London, England.
The share capital of the Company on 20 September 2021 was set at
GBP 30,000 (thirty thousand Pound Sterling), represented by
3,750,000 (three million seven hundred fifty thousand) Sponsor
Shares without nominal value. The Company may also issue Ordinary
Shares. The share capital has been fully paid up.
The registered office of the Company is located at 17, Boulevard
F.W. Raiffeisen, L--2411, Luxembourg. The financial year of the
Company starts on 1 January and ends on 31 December; except for the
first financial period which starts on 20 September 2021 (date of
incorporation) and ends on 31 December 2021.
The Company is managed by its Board of Directors composed of
Luke Alvarez, Cherry Freeman, Ian Livingstone as Executive
Directors and Jurgen Post, Emily Greer, and Addie Pinkster as
Non-Executive Directors (the "Board of Directors").
The sole shareholder of the Company is Hiro Sponsor I LLP (the
"Sponsor"); a limited liability partnership, incorporated and
existing under the laws of England, having its registered office
located at 18th Floor, the Scalpel, 52 Lime Street, London, EC3M
7AF, United--Kingdom, and registered with the United Kingdom's
Companies House under number OC439442.
The Company has been established for the purpose of acquiring
one operating business with principal business operations in a
member state of the European Economic Area or the United Kingdom or
Israel in the form of a merger, capital stock exchange, share
purchase, asset acquisition, reorganization or similar transaction
(the "Business Combination").
It is the intention of the Board of Directors that the Company
will undergo an initial offering (the "Placing") and be admitted to
listing on the standard listing segment of the FCA's Official List
and to trading on the London Stock Exchange's main market for
listed securities, a regulated market operated by the London Stock
Exchange PLC. The main characteristics which will be described in
the prospectus, to be approved by the United Kingdom Financial
Conduct Authority (the "FCA"), with its head office at 12 Endeavour
Square, London E20 1JN, United Kingdom, for the purpose of
admission of certain shares and warrants to the standard listing
segment of the FCA's Official List and to trading on the London
Stock Exchange's main market for listed securities.
The Company intends to seek a suitable target for the Business
Combination with a focus on targets operating in the sectors of
Video Games, Esports, Interactive Streaming, GenY Social Networks,
Connected Fitness & Wellness and Metaverse Technologies. The
Company will have 15 months from the date of the admission to
trading to consummate a Business Combination, plus an initial
three-month extension period (the "First Extension Period") and a
further three-month extension period (the "Second Extension
Period") subject in each case to approval by the Company's
shareholders. Otherwise, the Company will be liquidated and
distribute all of its assets to its shareholders, the Public shares
will be redeemed first and then the Company will be liquidated and
all remaining assets will be distributed to remaining shareholders
(Class B shareholders).
Pursuant to Article 3 of the current articles of association,
the Company's corporate purpose is the holding, management,
development and disposal of participations and any interests, in
Luxembourg or abroad, in any companies and/or enterprises in any
form whatsoever. The Company may in particular acquire by
subscription, purchase and exchange or in any other manner any
stock, shares and other participation securities, bonds,
debentures, certificates of deposit and other debt instruments and
more generally, any securities and financial instruments issued by
any public or private entity. It may participate in the creation,
development, management and control of any company and/or
enterprise. It may further invest in the acquisition and management
of a portfolio of patents or other intellectual property rights of
any nature or origin.
The Company may borrow in any form. It may issue notes, bonds
and any kind of debt and equity securities. The Company may lend
funds, including without limitation, resulting from any borrowings
of the Company and/or from the issue of any equity or debt
securities of any kind, to its Subsidiaries, affiliated companies
and/or any other companies or entities it deems fit.
The Company may further guarantee, grant security in favour of
or otherwise assist the companies in which it holds a direct or
indirect participation or which form part of the same group of
companies as the Company. The Company may further give guarantees,
pledge, transfer or encumber or otherwise create security over some
or all of its assets to guarantee its own obligations and those of
any other company, and generally for its own benefit and that of
any other company or person. For the avoidance of doubt, the
Company may not carry out any regulated activities of the financial
sector without having obtained the required authorization.
The Company may use any techniques and instruments to manage its
investments efficiently and to protect itself against credit risks,
currency exchange exposure, interest rate risks and other
risks.
The Company may, for its own account as well as for the account
of third parties, carry out any commercial, financial or industrial
operation (including, without limitation, transactions with respect
to real estate or movable property) which may be useful or
necessary to the accomplishment of its purpose or which are
directly or indirectly related to its purpose.
16 Basis of preparation and accounting policies
16.1 Basis of preparation
The Company's financial year starts on 1 January and ends on 31
December of each year, with the exception of the first financial
period, which starts on 20 September 2021 (date of incorporation)
and ends on 31 December 2021.
The separate financial statements comprise a statement of
financial position, a statement of comprehensive income, a
statement of changes in equity, a statement of cash flows and the
accompanying notes for the period ended 31 December 2021. These
separate financial statements have been prepared under the
assumption that the Company operates on a going concern basis.
These separate financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRS)
as adopted by the European Union for the period from 20 September
2021 (date of incorporation) to 31 December 2021 and were
authorised for issue in accordance with a resolution of the Board
of Directors on 14 April 2022.
These separate financial statements have been prepared in
Sterling (GPB) unless stated otherwise.
The principal accounting policies applied in the preparation of
these separate financial statements are set out below.
16.2 Summary of significant accounting policies
16.2.1 New or revised Standards or Interpretations
International accounting standards include IFRS, IAS
(International Accounting Standards) and their interpretations
(Standing Interpretations Committee) and IFRICs (International
Financial Reporting Interpretations Committee).
The repository adopted by the European Commission is available
on the following internet site:
http://ec.eu--ropa.eu/finance/accounting/ias/index_en.htm
(a) New standards, amendments and interpretations that were
issued but not yet applicable as at 31 December 2021 and that are
most relevant to the Company - not yet endorsed by the EU:
-- Reference to the Conceptual Framework - Amendments to IFRS 3:
In May 2020, the IASB issued Amendments to IFRS 3 Business
Combinations - Reference to the Conceptual Framework. The
amendments are intended to replace a reference to the Framework for
the Preparation and Presentation of Financial Statements, issued in
1989, with a reference to the Conceptual Framework for Financial
Reporting issued in March 2018 without significantly changing its
requirements.
-- The IASB also added an exception to the recognition principle
of IFRS 3 to avoid the issue of potential 'day 2' gains or losses
arising from liabilities and contingent liabilities that would be
within the scope of IAS 37 or IFRIC 21 Levies, if incurred
separately.
At the same time, the IASB decided to clarify existing guidance
in IFRS 3 for contingent assets that would not be affected by
replacing the reference to the Framework for the Preparation and
Presentation of Financial Statements.
The amendments are effective for annual reporting periods
beginning on or after 1 January 2022 and apply prospectively.
-- Amendments to IAS 1 -: Classification of Liabilities as
Current or Non-current. In January 2020, the IASB issued amendments
to paragraphs 69 to 76 of IAS 1 to specify the requirements for
classifying liabilities as current or non-current. The amendments
are effective for annual reporting periods beginning on or after 1
January 2023 and must be applied retrospectively.
-- Amendments to IAS 1 and IFRS Practice Statement 2 :
Disclosure of Accounting policies. In February 2021, the IASB
issued amendments that are intended to help preparers in deciding
which accounting policies to disclose in their financial
statements. The amendments are effective for annual periods
beginning on or after 1 January 2023.
-- Amendments to IAS 8: Definition of Accounting Estimate. In
February 2021 , the IASB issued amendments to help entities to
distinguish between accounting policies and accounting estimates.
The amendments are effective for annual periods beginning on or
after 1 January 2023.
-- Amendments to IAS 12 - not yet endorsed by the EU: Deferred
Tax related to Assets and Liabilities arising from a Single
Transaction. In May 2021, the IASB amended the standard to reduce
diversity in the way that entities account for deferred tax on
transactions and events, such as leases and decommissioning
obligations, that lead to the initial recognition of both an asset
and a liability. The amendments apply for annual reporting periods
beginning on or after 1 January 2023 and may be applied early.
-- Amendments to IAS 37: Onerous Contracts - Cost of Fulfilling
a Contract. The amendments specify that the 'cost of fulfilling' a
contract comprises the 'costs that relate directly to the
contract'. Costs that relate directly to a contract can either be
incremental costs of fulfilling that contract (examples would be
direct labour, materials) or an allocation of other costs that
relate directly to fulfilling contracts (an example would be the
allocation of the depreciation charge for an item of property,
plant and equipment used in fulfilling the contract). The
amendments are effective for annual reporting periods beginning on
or after 1 January 2022 with earlier application permitted.
-- Annual improvements to IFRS Standards 2018-2020 : The annual
improvements to IFRS consists of amendments to IFRS 1, IFRS 9, IFRS
16, and IAS 41. The amendments are effective for annual reporting
periods beginning on or after 1 January 2022 with earlier
application permitted.
(b) The initial application of these standards, interpretations,
and amendments to existing standards is planned for the period of
time from when its application becomes compulsory. Currently, the
Board of Directors anticipates that the adoption of these Standards
and Interpretations in future periods will have no material impact
on the financial information of the Company.
16.2.2 Foreign currencies
Functional and presentation currency
These separate financial statements are presented in Sterling
(GBP).
Foreign currency transactions and balances
In preparing these separate financial statements of the Company,
transactions in currencies other than the entity's functional
currency (foreign currencies) are recognised at the rates of
exchange prevailing on the dates of the transactions. At each
reporting date, monetary assets and liabilities that are
denominated in foreign currencies are retranslated at the rates
prevailing at that date. Non--monetary items carried at fair value
that are denominated in foreign currencies are translated at the
rates prevailing at the date when the fair value was determined.
Nonmonetary items that are measured in terms of historical cost in
a foreign currency are not retranslated.
Exchange differences are recognised in profit or loss in the
year in which they arise except for exchange differences on
monetary items related to deferred costs included in trade
payables; which are recognised directly in deferred cost.
16.2.3 Financial instruments
A financial instrument is any contract that gives rise to a
financial asset of one entity and a financial liability or equity
instrument of another entity. The Company recognises a financial
asset or a financial liability when it becomes a party to the
contractual provisions of the instrument. Purchases or sales of
financial assets that require delivery of assets within the time
frame generally established by regulation or convention in the
marketplace (regular way trades) are recognised on the trade date
i.e. the date that the Company commits to purchase or sell the
asset.
Recognition and derecognition
Financial assets and financial liabilities are recognised when
the Company becomes a party to the contractual provisions of the
financial instrument.
Financial assets are derecognised when the contractual rights to
the cash flows from the financial asset expire, or when the
financial asset and substantially all the risks and rewards are
transferred.
A financial liability is derecognised when it is extinguished,
discharged, cancelled or expires. When an existing financial
liability is replaced by another from the same lender on
substantially different terms, or the terms of an existing
liability are substantially modified, such an exchange or
modification is treated as the derecognition of the original
liability and the recognition of new liability. The difference in
the respective carrying account is recognised in the statement of
profit or loss.
Classification and initial measurement of financial assets
All financial assets are initially measured at fair value
adjusted for transaction costs (where applicable).
Financial assets are classified into one of the following
categories:
-- amortised cost
-- fair value through profit or loss (FVTPL), or
-- fair value through other comprehensive income (FVOCI).
In the period presented the Company includes cash and cash
equivalents in the category Financial assets held at amortised
costs.
In the period presented the Company includes investments in
subsidiaries in the category Fair value through profit or loss.
In the period presented the Company does not have any financial
assets categorised as FVOCI.
The classification is determined by both:
-- the entity's business model for managing the financial asset, and
-- the contractual cash flow characteristics of the financial asset.
All revenue and expenses relating to financial assets that are
recognised in profit or loss are presented within finance costs,
finance income or other financial items, except for impairment of
trade receivables which is presented within other expenses.
Subsequent measurement of financial assets
Financial assets are measured at amortised cost if the assets
meet the following conditions and are not designated as FVTPL:
-- they are held within a business model whose objective is to
hold the financial assets and collect its contractual cash flows,
and
-- the contractual terms of the financial assets give rise to
cash flows that are solely payments of principal and interest on
the principal amount outstanding.
After initial recognition, these are measured at amortised cost
using the effective interest method (EIR). Discounting is omitted
where the effect of discounting is immaterial.
Impairment of financial assets
IFRS 9's impairment requirements use forward--looking
information to recognise expected credit losses - the 'expected
credit loss (ECL) model'. Instruments within the scope of the
requirements included loans and some financial guarantee contracts
(for the issuer) that are not measured at fair value through profit
or loss.
The Company considers a broader range of information when
assessing credit risk and measuring expected credit losses,
including past events, current conditions, reasonable and
supportable forecasts that affect the expected collectability of
the future cash flows of the instrument.
In applying this forward--looking approach, a distinction is
made between:
-- financial instruments that have not deteriorated
significantly in credit quality since initial recognition or that
have low credit risk ('Stage 1').
-- financial instruments that have deteriorated significantly in
credit quality since initial recognition and whose credit risk is
not low ('Stage 2').
-- 'Stage 3' would cover financial assets that have objective
evidence of impairment at the reporting date.
Measurement of the expected credit losses is determined by a
probability--weighted estimate of credit losses over the expected
life of the financial instrument.
Classification and measurement of financial liabilities
The financial liabilities are classified, at initial
recognition, as financial liabilities at fair value through profit
or loss or financial liabilities at amortised cost. The Company's
financial liabilities carried at amortised costs include borrowings
and trade and other payables.
Financial liabilities are initially measured at fair value, and,
where applicable, adjusted for transaction costs unless the Company
designated a financial liability at fair value through profit or
loss.
Financial liabilities recognised at amortised cost are
subsequently measured, using the effective interest method.
All interest--related charges and, if applicable, changes in an
instrument's fair value that are reported in profit or loss are
included within finance costs or finance income.
Offsetting financial instruments
Financial instruments are offset and a net amount reported in
the statement of financial position only when there is currently a
legally enforceable right to offset the recognised amounts and
there is an intention to settle on a net basis, or realise the
asset and settle the liability simultaneously.
16.2.4 Cash and cash equivalents
Cash and cash equivalents in the statement of financial position
comprise cash at banks and on hand and short term, highly liquid
deposits with a maturity of three months or less, that are readily
convertible to a known amount of cash and subject to an
insignificant risk of changes in value. The carrying amounts of
these approximate their fair value.
For the purpose of the financial statement of cash flows, cash
and cash equivalents consist of cash and short term deposits, as
defined above, net of outstanding bank overdrafts as they are
considered an integral part of the Company's cash management.
16.2.5 Fair value measurement
Fair value is the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. The fair value
measurement is based on the presumption that the transaction to
sell the asset or transfer the liability takes place either:
-- In the principal market for the asset or liability; or
-- In the absence of a principal market, in the most
advantageous market for the asset or liability.
The principal or the most advantageous market must be accessible
by the Company.
The fair value of an asset or a liability is measured using the
assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their
economic best interest.
A fair value measurement of a non--financial asset takes into
account a market participant's ability to generate economic
benefits by using the asset in its highest and best use or by
selling it to another market participant that would use the asset
in its highest and best use.
The Company uses valuation techniques that are appropriate in
the circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable
inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or
disclosed in these separate financial statements are categorised
within the fair value hierarchy, described as follows, based on the
lowest level input that is significant to the fair value
measurement as a whole:
-- Level 1 -- Quoted (unadjusted) market prices in active
markets for identical assets or liabilities;
-- Level 2 -- Valuation techniques for which the lowest level
input that is significant to the fair value measurement is directly
or indirectly observable;
-- Level 3 -- Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.
16.2.6 Provisions assets and contingent liabilities
Provisions are recognised when the Company has a present
obligation (legal or constructive) as a result of a past event, it
is probable that an outflow of economic resources will be required
from the Company and a reliable estimate can be made of the amount
of the obligation. The timing or amount of the outflow may still be
uncertain.
Provisions are not recognised for future operating losses.
Provisions are measured at the estimated expenditure required to
settle the present obligation, based on the most reliable evidence
available at the reporting date, including the risks and
uncertainties associated with the present obligation. Where there
are a number of similar obligations, the likelihood that an outflow
will be required in settlement is determined by considering the
class of obligations as a whole.
If the effect of the time value of money is material, provisions
are discounted using a current pre--tax rate that reflects, when
appropriate, the risks specific to the liability. When discounting
is used, the increase in the provision due to the passage of time
is recognised as a finance cost.
Any reimbursement that the Company is virtually certain to
collect from a third party with respect to the obligation is
recognised as a separate asset. However, this asset may not exceed
the amount of the related provision.
No liability is recognised if an outflow of economic resources
as a result of present obligations is not probable. Such situations
are disclosed as contingent liabilities unless the outflow of
resources is remote.
16.2.7 Other payables and accrued expenses
Other payables and accrued expenses are obligations to pay for
services that have been or will be acquired in the ordinary course
of business from suppliers. They are classified as current
liabilities if payment is due within twelve months after statement
of financial position date. If not, they are represented as
non--current liabilities. Other payables and accrued expenses are
recognised initially at fair value and subsequently stated at
amortised costs. The difference between the proceeds and the amount
payable is recognised over the period of the payable using the
effective interest method.
16.2.8 Taxation
Income tax recognized in the statement of profit or loss and
other comprehensive income includes current and deferred taxes.
Current tax
Current income tax assets and liabilities are measured at the
amount expected to be recovered from or paid to the taxation
authorities. The tax rates and tax laws used to compute the amount
are those that are enacted or substantively enacted at the
reporting date in the countries where the Company operates and
generates taxable income.
Current and deferred tax are recognised in profit or loss,
except when they relate to items that are recognised in other
comprehensive income or directly in equity, in which case, the
current and deferred tax are also recognised in other comprehensive
income or directly in equity respectively. Where current tax or
deferred tax arises from the initial accounting for a business
combination, the tax effect is included in the accounting for the
business combination.
Deferred tax
Deferred tax is recognized on temporary differences between the
carrying amounts of assets and liabilities in these separate
financial statements and the corresponding tax bases used in the
computation of taxable profit.
Deferred tax liabilities are generally recognized for all
taxable temporary differences. Deferred tax assets are generally
recognized for all deductible temporary differences to the extent
that it is probable that taxable profits will be available against
which those deductible temporary differences can be utilized. This
is assessed based on the company's forecast of future operating
results, adjusted for significant non--taxable income and expenses
and specific limits on the use of Deferred tax liabilities are
generally recognised in full, although IAS 12 specifies limited
exemptions. As a result of these exemptions in the future the
company will not recognise deferred tax on temporary differences
relating to its future investments in subsidiaries.
Such deferred tax assets and liabilities are not recognized if
the temporary difference arises from goodwill or from the initial
recognition (other than in a business combination) of other assets
and liabilities in a transaction that affects neither the taxable
profit nor the accounting profit.
The carrying amounts of deferred tax are reviewed at the end of
each reporting period and adjusted if needed.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied
by the same taxation authority and the Company intends to settle
its current tax assets and liabilities on a net basis.
16.2.9 Current versus non-current classification
The company presents assets and liabilities in statement of
financial position based on current/non--current
classification.
An asset is current when it is:
-- expected to be realised or intended to be sold or be consumed
in normal operating cycle;
-- held primarily for the purpose of trading;
-- expected to be realised within twelve months after the reporting period; or
-- cash or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least twelve months
after the reporting period.
All other assets are classified as non-current.
A liability is current when:
-- it is expected to be settled in normal operating cycle;
-- it is held primarily for the purpose of trading;
-- it is due to be settled within twelve months after the reporting period; or
-- there is no unconditional right to defer the settlement of
the liability for at least twelve months after the reporting
period.
All other liabilities are classified as non--current.
16.2.10 Operating expenses
Operating expenses are recognised in profit or loss upon
utilisation of the service or as incurred.
17 Significant accounting judgements, estimates and assumptions
The preparation of these financial statements in conformity with
IFRS requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and
the reported amounts of assets, liabilities, income and
expenses.
Actual results and outcomes may differ from management's
estimates and assumptions due to risks and uncertainties, including
uncertainty in the current economic environment due to the ongoing
outbreak of a novel strain of the coronavirus ("COVID --1 9")
In December 2019, a COVID --1 9 outbreak was reported in China,
and, in March 2020, the World Health Organization declared it a
pandemic. Since being initially reported in China, the coronavirus
has spread to over 150 countries.
Given the ongoing and dynamic nature of the COVID --1 9 crisis,
it is difficult to predict the impact on the business of potential
targets. The extent of such impact will depend on future
developments, which are highly uncertain and cannot be predicted,
including new information which may emerge concerning the severity
of the coronavirus and actions taken to contain the coronavirus or
its impact, among others. The ongoing COVID --1 9 pandemic, the
increased market volatility and the potential unavailability of
third--party financing caused by the COVID --1 9 pandemic as well
as restrictions on travel and in--person meetings, which may hinder
the due diligence process and negotiations, may also delay and/or
adversely affect the Business Combination or make it more
costly.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimates are revised and in any future periods
affected.
As at 31 December 2021, the significant areas of estimation,
uncertainty and critical judgements in applying accounting policies
that have the most significant effect on the amounts recognised in
these separate financial statements are:
-- Going concern: Judgement on going concern consideration. The
Board of Directors' underlying assumption to prepare these separate
financial statements is based on the anticipated successful
completion of the Placing. As required by art. 480--2 of the
Luxembourg law of 10 August 1915 (as amended) the Board of
Directors of the Company plans to present a business continuity
plan to the shareholders. On 19 January 2022 the Company entered
into a loan agreement with the Sponsor for the purpose of settling
its creditors and other costs which become due in the ordinary
course of business, should the Placing for any reason not be
successful. (Note 15.3)
-- Deferred costs: According to the Board of Directors'
underlying assumption of a successful admission to the regulated
market of the London Stock Exchange, the related amounts incurred
as transaction costs as of 31 December 2021 that qualify as
incremental costs directly attributable to the Placing are deferred
until the effects of the Placing are reflected in the accounts, and
reported as deferred costs in these separate financial statements
as of that date. These deferred costs will be deducted from the
proceeds of the planned Placing, which occurred on the 2(nd) of
February 2022.
18 Financial risk management, objectives and policies
The Company is newly formed and has not conducted any operations
and currently generates no revenue. The Company does not have
material foreign currency transactions. Hence, currently the
Company does not face foreign currency risks nor any interest rate
risks as the financial instruments of the Company bear a fixed
interest rate.
Liquidity risks
Liquidity risk is the risk that the Company will encounter
difficulty in meeting its financial obligations as they fall due.
If the Placing contemplated by the Company is completed, 100% of
the gross proceeds of this Placing will be deposited in a secured
deposit account. The amount held in the secured deposit account
will only be released in connection with the completion of the
Business Combination or the Company's liquidation. Following the
completion of the Placing, the Board of Directors believes that the
funds available to the Company outside of the secured deposit
account, together with the available shareholder loan will be
sufficient to pay costs and expenses which are incurred by the
Company prior to the completion of the Business Combination.
The objective of the Sponsor Warrants issued to the Sponsor at
the time of the Placing, is to use the proceeds to pay the various
costs and expenses incurred and contracted for as disclosed in the
Separate Financial Statements, except the underwriting commission.
The proceeds of the Placing of Public Shares will not be used to
pay these expenses.
The Sponsor is committing additional funds to the Company
through the Overfunding Subscription, the proceeds of which will be
held in an escrow account. The purpose of the overfunding
subscription is to provide additional cash funding into the Escrow
Account, in addition to the funding from the proceeds of the Units
sold in the Placing, for the redemption of the Public Shares by
Public Shareholders ("Initial Overfunding Shares").
The Initial Overfunding Shares and Initial Overfunding Warrants
are not part of the Placing but will be part of the applications
for Shares Admissions and Warrants Admission.
To the extent that the Business Combination Deadline is
extended, the Sponsor will commit further additional funds to the
Company through the subscription of additional units as referred to
in Part VIII. 4 of the Prospectus.
Capital management
The Board of Directors' policy is to maintain a strong capital
base so as to maintain investor, creditor, and market confidence
and to sustain future development of the business. In order to meet
the capital management objective described above, the Company
intends to raise funds through a Placing reserved to certain
qualified investors inside and outside of the United Kingdom, and
to have the public shares and public warrants to be issued in such
Placing admitted to listing and trading on the regulated market
segment of London Stock Exchange in the near future. The
above--mentioned financial instruments to be issued as part of this
Placing will represent what the entity will manage as capital.
Credit risk
Credit risk is the risk that a counterparty will not meet its
obligations under a financial instrument or customer contract,
leading to a financial loss. The Company is currently exposed to
credit risk from its deposit with banks.
19 Other operating expenses
The other operating expenses of GBP 152,560 consist of fees for
accounting, legal, and other services not related to the
Placing.
20 Sept 2021
to
31 Dec 2021
-------------
GBP
Accounting, tax consulting, auditing and similar
fees....................................................................... 151,407
Notarial and similar
fees.................................................................................................
........................ 1,153
Other operating
expenses.............................................................................................
........................... 152,560
=============
20 Income Tax
20 Sept 2021
to
31 Dec 2021
-------------
GBP
Loss for the period before
tax..................................................................................................
.............. 152,288
Theoretical tax charges, applying the tax rate of
22.8%.................................................................. (34,722)
Tax effect of adjustments from Luxembourg GAAP to
IFRS........................................................ (166,761)
Unrecognised deferred tax
asset................................................................................................
............ 201,783
Income Tax --
=============
Income tax
The tax rate used in reconciliation above is the Luxembourgish
tax rate (22.8%) as the Company is domiciled in the Grand Duchy of
Luxembourg.
Deferred tax
Deferred tax assets have not been recognised in respect of the
loss incurred during the period ended 31 December 2021 because it
is not probable that future taxable profit will be available
against which the Company can utilise the benefits therefrom.
Unused tax losses of the Company can be used within a period of 17
years as per Luxembourg tax law.
21 Earnings /(loss) per share
Basic earnings/(loss) per share ("EPS") is calculated by
dividing the profit/(loss) for the year attributable to ordinary
equity holders of the Company by the weighted average number of
ordinary shares outstanding during the period.
Diluted EPS is calculated by dividing the profit/(loss)
attributable to ordinary equity holders of the Company by the
weighted average number of ordinary shares outstanding during the
year plus the weighted average number of ordinary shares that would
be issued on conversion of all the dilutive potential ordinary
shares into ordinary shares.
Currently, no other diluting instruments have been issued.
Therefore, basic EPS equals diluted EPS as at 31 December 2021.
22 Financial assets at fair value through profit or loss
On the 8th of December 2021 the company incorporated HMA1
(ESCROW) Limited, under the Companies Act 2006 ,in the United
Kingdome, being a private company, limited by shares, with its
registered office at 52 Lime Street, London, England .
23 Deferred costs
Deferred costs of GBP 731,407 as at 31 December 2021 are
composed mainly of legal and administration costs incurred by the
Company in relation to the public offering which will be offset
against the proceeds from the planned Placing.
Other Placing related costs which have not been incurred relate
to the underwriter fees, legal fees for the underwriter and escrow,
exchange, regulatory, and listing fees. These costs once incurred
will also be deducted from the proceeds of the Placing.
24 Cash and cash equivalents
The amount of cash and cash equivalents was GBP 30,000 as at 31
December 2021.
25 Issued capital and reserves
Share capital
As at 31 December 2021, the subscribed share capital amounts to
GBP 30,000 consisting of 3,750,000 shares without nominal value
held by the Sponsor, hereinafter referred to as the "Sponsor
Shares". The Company's share capital may be increased or reduced by
a resolution of the general meeting of shareholders adopted in the
manner required for an amendment for the articles of
association.
On 26 January 2022, the issued capital shares was reduced from
3,750,000 to 2,875,000 through a forfeiture of 875,000 Sponsor
Shares at a nil cost.
It is planned that the Sponsor Shares shall convert into Public
Shares subject to a certain schedule and trading price following
the consummation of the Business Combination. The Sponsor Shares
will convert into a number of Public Shares such that the number of
Public Shares issuable to the Sponsor upon conversion of all
Sponsor Shares will be equal, in the aggregate, on an as--converted
basis, to 20% of the total ordinary shares in issue following the
Placing. The Placing took place on 2 February 2022, refer to note
15.4 for detailed information of the effect of the placing on the
Share capital and 15.5 on the Warrants at reporting date.
Authorised capital
As at 31 December 2021, the authorized capital of the Company is
set at GBP 1,000,000 consisting of 100,000,000 shares without
nominal value.
Legal reserves
The Company is required to allocate a minimum of 5% of its
annual net profit to a legal reserve, until this reserve equals 10%
of the subscribed share capital. This reserve may not be
distributed.
26 Trade and other payables
31 Dec2021
------------
GBP
Accounting, tax consulting, auditing and similar
fees....................................................................... 151,135
Deferred
costs.................................................................................................
.......................................... 731,407
Notarial and similar
fees..................................................................................................
....................... 1,153
Payable to subsidiary 1
------------
Trade and other payables 883,696
============
Trade and other payables are related to legal and other services
received by the Company. The carrying amounts of these approximate
their fair value.
27 Related party disclosures
Parties are considered to be related if one party has the
ability to control the other party or exercise significant
influence over the other party in making financial or operational
decisions.
Terms and conditions of transactions with related parties
On 8 December 2021 the company incorporated HMA1 (ESCROW)
LIMITED "(HMA1)" with Company Number 13788517 respired with The
Companies House United Kingdom, with Share Capital of GBP 1. At
reporting date the company has not transferred the Share Capital to
the subsidiary, the amount due is included in trade and other
payables. The Company subscribed for additional shares in HMA1 as
disclosed in note 15.7.
There have been no guarantees provided or received for any
related party receivables or payables as at 31 December 2021.
Please refer to note 15.4 regarding the Shareholders loan put in
place subsequent to 31 December 2021.
Transactions with key management personnel
There are no advances or loans granted to members of the Board
of Directors as at 31 December 2021.
The Board of Directors consists of 6 members who did not receive
any remuneration during the period ended 31 December 2021.
The Company entered into contracts with the non--executive
directors which will be effective from the date of the Placing. The
agreed directors fees are GBP 10,000 per annum; to be paid
semi--annually in arrears in equal instalments after deduction of
any taxes and other amounts that are required by law. In addition
to the directors fee the Company will procure that the Sponsor
transfers 25,000 Sponsor Shares in the Company held by the Sponsor
to the non--executive directors.
28 Commitments and contingencies
In the context of the planned Placing, the Company entered into
or is contemplating to enter into respective contracts with
different providers, the total costs of which is estimated at
approximately GBP 1,200,000 (excluding underwriting commission fees
and the costs recorded as deferred costs). After the Placing, the
Company expects to incur expenses as a result of being a publicly
listed company (for legal, financial reporting, accounting and
auditing compliance). The Company cannot estimate expenses incurred
in connection with researching targets, the investigation of
potential target businesses and the negotiation, drafting and
execution of the transaction documents appropriate for the Initial
Business Combination, as the amounts will depend on the specific
circumstances of the Initial Business Combination.
The Company has no other commitments and contingencies as at 31
December 2021.
29 Events after statement of financial position date
No events occurred after the reporting period which requires
amendment to or disclosure in these separate financial statements,
except from those disclosed below.
29.1 Impact of the COVID-19 pandemic
As a result of the COVID-- 1 9 pandemic business operations
worldwide have been impacted in various ways. The COVID --1 9
pandemic may continue to impact the business operations and the
intended Placing and Business Combination processes. There is
uncertainty in the nature and degree of its continued effects over
time.
29.2 Underwriting agreement
The Company entered into an agreement with Citigroup Global
Markets Limited (Underwriting Agreement), by virtue of which the
Company will be liable to pay Upfront Commission Fees of 2% of the
aggregate gross proceeds of the Securities, payable at closing of
the offering; and a deferred commission equal to 3.5% of the
aggregate gross proceeds of the Securities, subject to completion
of Business Combination and payable after such completion.
Commissions are not payable on Securities issued to certain
Investors; subject to a maximum allocated amount of the greater of
either GBP 32.5 million or 15% of the Offering.
29.3 Shareholders loan
On 19 January 2022, the Company entered into a loan agreement
with the Sponsor for the purpose of settling its creditors and
other costs which become due in the ordinary course of business,
should the Placing for any reason not be successful. . At reporting
date no amount was drawn. The Placing took place on 2 February
2022. The loan shall be available to the Company up until
consummation of the Business Combination or the liquidation of the
Company.
29.4 Listing on London Stock Exchange
On 2 February 2022 the Company's Prospectus was approved and
published on the London Stock Exchange.
In terms of the Sponsor Private Placement Agreement; on 2
February 2022, the Sponsor subscribed to 310,500 Overfunding shares
at GBP10 per share, and 5,070,000 Class B Sponsor Warrants at GBP1
per warrant, raising capital in the amount of GBP 8,175,000.
On 7 February 2022, 11,500,000 of the Company's Public Shares
were admitted to the standard listing segment of the Official List
of the Financial Conduct Authority and to trading on the London
Stock Exchange's main market for listed securities under ticker
"HMA1", raising capital in the amount of GBP 115,000,000.
On 7 February 2022 Citigroup Global Markets Limited, acting as
stabilising manager, gave notice on of its non-exercise of the put
option granted by the Company.
On 8 February 2022 the Sponsor subscribed for a further 34,500
Shares cum Rights at a price of GBP 10.00 per share, (the
"Overfunding Shares Subscription"). The non-exercise of the Put
Option and the Overfunding Shares Subscription brings the total
number of Shares cum Rights in issue at 11,845,000.
The total number of voting rights in the Company following the
Overfunding Subscription is 14,720,000. This including the
2,875,000 unlisted class B ordinary shares with no par value held
by the Sponsor.
15.5 Warrants Admission to Trading on the London Stock Exchange
On 8 February 2022 the company published its notice on the stock
exchange that it intends to accelerate the proposed issue and
admission of the Public Warrants as follows:
- Warrants Ex Date 22 February 2022
- Warrants Record Date 6.00 p.m. on 23 February 2022
- Warrants Admission Date 8.00 a.m. on 24 February 2022
On 8 February 2022, the Sponsor, in terms of the Sponsor Private
Placement Agreement; subscribed for a further 230,000 Sponsor
Warrants at GBP1 per warrant.
On 24 February 2022, the Company admitted 5,922,500 Public
Warrants to the standard listing segment of the Official List of
the Financial Conduct Authority and to trading on the London Stock
Exchange's main market for listed securities under ticker
"HM1W".
15.6 Subscription of shares in HMA1 (Escrow) Limited
On 11 February 2022, the Company entered into a Subscription
agreement with its wholly owned subsidiary HMA1to subscribe for
11,845,000 ordinary shares at nominal value of GBP 1 per share. The
consideration was fully paid up on the 15(th) of February 2022.
15.7 Geopolitical Situation
Management considered the effects of the invasion of Ukraine by
Russia and it has no impact on the company and consequently does
not affect the measurement of companies' assets and liabilities as
at 31 December 2021.
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FR FZGZDFLRGZZM
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April 29, 2022 09:46 ET (13:46 GMT)
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