Bending Spoons Shares Surge 41% as Berkshire Hathaway Adds $330m Stake

Bending Spoons (NASDAQ: BSP) shares jumped 41.20% today after Berkshire Hathaway (NYSE: BRK.A) agreed to buy another $330m of new stock, bringing its stake to 4%. Bending Spoons is the Milan-based company that buys established digital businesses, including AOL, Vimeo and Evernote, and overhauls how they run.

The shares closed at $53.46, up from $37.86 yesterday, on volume of 18.8m against 1.7m the day before. They opened at $50.28 and touched $58.56, just short of the record intraday high of $58.94 set on the 11th of August.

The company announced the deal before the US market opened, in a release distributed by Business Wire. Berkshire will buy 10 million new ordinary shares at $33.00 in a private placement, meaning new shares sold directly to one investor. It follows the $600m Berkshire invested at the company’s July IPO.

Closing is subject to customary conditions, and a Form 6-K, the report foreign companies file with the US Securities and Exchange Commission, is to follow. The deal is expected to close in the fourth quarter.

Berkshire is paying about 13% less than yesterday’s close, and well below today’s. Proceeds go to general corporate purposes and acquisitions. Francesco Patarnello, Bending Spoons’ head of business acquisitions and co-founder, framed the deal this way:

We believe Berkshire Hathaway’s investment reflects confidence in our team and Platform and will further enhance our financial flexibility and ability to pursue attractive acquisitions as part of our broader financing strategy.

Francesco Patarnello, Bending Spoons

The stock has been volatile since its debut on the 1st of July. It closed at $32.03 on the 2nd of October, so today’s close is about 67% higher. It also jumped 24% on the 7th of October with no obvious catalyst, then gave back part of that.

Berkshire has not commented on the deal. The $33 placement price is not available to other investors, and the jump shows how the shares reacted to the announcement rather than any change in the business itself.