NOT FOR DISTRIBUTION, PUBLICATION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, JAPAN, HONG KONG, SOUTH AFRICA OR THE
UNITED STATES OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION, PUBLICATION
OR RELEASE WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF
ANY OF THE SECURITIES DESCRIBED HEREIN.
Borgestad, 6 November 2023: Borgestad ASA (the "Company") hereby announces a
contemplated private placement of new shares in the Company (the "Offer Shares")
to raise gross proceeds of up to NOK 250 million (the "Private Placement"). The
subscription price per Offer Share (the "Subscription Price"), and the number of
Offer Shares to be issued, in the Private Placement will be determined by the
Company's board of directors (the "Board") on the basis of an accelerated
bookbuilding process conducted by the Managers (as defined below).
The Company has engaged Arctic Securities AS and SpareBank 1 Markets AS as
managers for the Private Placement (the "Managers").
The net proceeds from the Private Placement will be used (i) to repay the
outstanding debt under the Company's bond loan (BOR04) with a principal amount
of approximately NOK 100 million (the "Bond Loan"), by carrying out a full
redemption of the issued bonds at a price equal to 100% of the nominal value,
(ii) to repay EUR 10 million (approximately NOK 120 million) of the group's
investment loan with Pekao S.A. Bank with a principal amount of approximately
EUR 40.4 million (the "Agora Bytom Loan"), in connection with a contemplated
refinancing of such loan, and (iii) for general corporate purposes.
The Private Placement forms part of a contemplated refinancing of the Borgestad
group as further described in the Company's quarterly report for the third
quarter of 2023 published on 6 November 2023 and in the attached company
presentation. Another important element of the contemplated refinancing is the
conditional sale-leaseback transaction for the two properties in Bjuv
municipality in Sweden, where the group's factory and other production
facilities for refractory products are located, as announced through the
Company's stock exchange announcement dated 27 October 2023 (the "Sale-leaseback
Transaction").
The Company has received significant interest from both existing shareholders
and new investors to subscribe for Offer Shares in the Private Placement. The
following existing shareholders and primary insiders have, subject to certain
conditions, committed to participate in the Private Placement as follows, at a
Subscription Price at market if not otherwise specified:
- NOK 75 million from Kontrari AS (represented on the Board by Jan Erik
Sivertsen).
- NOK 85 million from Ses AS (represented on the Board by Helene Steen).
- NOK 15 million from Gross Management AS (represented by the chairperson of the
Board, Glen Ole Rødland) at a Subscription Price with a maximum limit of NOK
0.15 per Offer Share.
- NOK 10.6 million from Dione AS and Ploot Invest AS (represented on the Board
by Jacob Møller).
- NOK 1.2 million from CEO Pål Feen Larsen (his pro rata portion of the Private
Placement).
- The NOK equivalent of EUR 100,000 from Jawendel AS (represented on the Board
by Wenche Kjølås).
- NOK 0.25 million from Frode Martinussen, Group CEO of Höganäs Borgestad.
The bookbuilding period in the Private Placement (the "Bookbuilding Period")
commences today, 6 November 2023, at 16:30 hours (CET) and closes on 7 November
2023 at 08:00 (CET). The Managers and the Company may, however, at any time
resolve to close or extend the Bookbuilding Period at their sole discretion and
on short or no notice. If the Bookbuilding Period is shortened or extended, any
other dates referred to herein may be amended accordingly.
The Private Placement will be directed towards Norwegian and international
investors, in each case subject to and in compliance with applicable exemptions
from relevant prospectus, filing and other registration requirements. The
minimum application and allocation amount in the Private Placement has been set
to the NOK equivalent of EUR 100,000. The Company may, however, at its sole
discretion, allocate an amount below EUR 100,000 to the extent applicable
exemptions from the prospectus requirement pursuant to applicable regulations,
including Regulation (EU) 2017/1129 (the Prospectus Regulation) and ancillary
regulations, are available.
Conditions for completion
Completion of the Private Placement is subject to approval by the Company's
extraordinary general meeting expected to take place on or around 28 November
2023 (the "EGM"), in addition to the registration of the share capital increase
pertaining to the Private Placement in the Norwegian Register of Business
Enterprises, and issuance of the Offer Shares in the VPS.
Pursuant to the Norwegian Public Limited Companies Act, the Subscription Price
cannot be lower than the nominal value of the Company's shares. If the
Subscription Price is set below NOK 1 (which is equivalent to the current
nominal value), completion of the Private Placement will further be made
conditional upon the completion of a share capital reduction where the nominal
value per share is reduced from NOK 1 to an amount equal to the Subscription
Price (the "Share Capital Reduction"). The Share Capital Reduction will not
require creditor notification.
Given the importance of the Sale-leaseback Transaction for the contemplated
refinancing of the Borgestad group, completion of the Private Placement will
also be made conditional upon approval of the Sale-leaseback Transaction from
the Municipal Council of Bjuv. Such approval is a condition for completion of
the Sale-leaseback Transaction. In addition, completion of the Sale-leaseback
Transaction is conditional upon the approval from the Municipal Council becoming
final and binding, which will occur if the approval is not appealed within a
three-week appeal period. The Private Placement is, however, only made
conditional upon the initial approval by the Municipal Council (and not upon
such approval having become final and binding). Consequently, there is a risk
that the Private Placement will be completed without the Sale-leaseback
Transaction being completed (and without the Borgestad group receiving the
purchase price from this transaction).
Completion of the Private Placement will lastly be conditional upon the
prefunding agreement between the Company and the Managers described below not
having been terminated, and approval by the EGM of a subsequent repair offering
in the Company as described below (the "Subsequent Offering").
The Private Placement will not be completed if the above conditions (the
"Conditions") are not fulfilled by 15 December 2023, and the Board may also
decide not to complete the Private Placement for any other reason. Neither the
Company nor the Managers will be liable for any losses incurred by applicants if
the Private Placement is cancelled, irrespective of the reason for such
cancellation.
Investors who are allocated Offer Shares in the Private Placement undertake to
vote in favour of the Share Capital Decrease (if relevant), the Private
Placement (including the Board's proposed allocation) and the Subsequent
Offering at the EGM.
Although not a condition for completion of the Private Placement, the Board
will, in connection with, and subject to completion of, the Private Placement,
also propose to redeem the Company's 8,010 treasury shares.
Allocation, payment and delivery of Offer Shares
Conditional allocation of the Offer Shares will be determined by the Board, in
consultation with the Managers, following the expiry of the Bookbuilding Period.
Information about conditional allocation will be sent from the Managers to the
subscribers who have received conditional allocation, on or around 7 November
2023, subject to any shortening or extension of the Bookbuilding Period. Final
allocation will be resolved by the EGM, and information on final allocation will
be sent from the Managers to the subscribers who have received conditional
allocation, on or around 29 November 2023, subject to any shortening or
extension of the Bookbuilding Period and subject to the fulfilment of the
Conditions.
Settlement of the Offer Shares is expected to take place on a delivery versus
payment basis ("DvP") on or around 30 November 2023, provided that the
Conditions are fulfilled. The DvP settlement will be facilitated through a
prefunding agreement expected to be entered into between the Company and the
Managers. The Offer Shares cannot be traded on the Oslo Stock Exchange until the
share capital increase pertaining to the Private Placement has been registered
in the Norwegian Register of Business Enterprises and the Prospectus (as defined
below) has been published.
The Company will publish a prospectus for the listing of the Offer Shares, as
well as the offer and listing of new shares in connection with the Subsequent
Offering (the "Prospectus"), on or around 4 December 2023. If the Offer Shares
are issued before the Prospectus is published, they will be delivered to
investors under a separate ISIN and will only be tradable on the Oslo Stock
Exchange after the Prospectus has been published.
Assessment of the transaction structure and equal treatment
The Board has carefully considered the Private Placement in light of the equal
treatment rules under the Norwegian Public Limited Companies Act, the Norwegian
Securities Trading Act, the Oslo Stock Exchange's Rule Book II and the Oslo
Stock Exchange's guidelines for equal treatment, and is of the opinion that the
proposed Private Placement is in compliance with these requirements.
The Bond Loan matures on 8 January 2024, and the Board considers it necessary to
complete a capital raise as swiftly as possible to ensure that the Company can
repay the Bond Loan at or prior to maturity. The Company's financial position
will be very serious if such repayment cannot be made.
It is further noted that the Agora Bytom Loan matures on 30 June 2024, but that
the Company has entered into a term sheet with Pekao S.A. Bank, which, among
other things, entails that the maturity date for the loan will be postponed
until 31 December 2028, provided that the Company repays approximately NOK 120
million of the loan, that a final amendment agreement is entered into and that
certain additional conditions for completion are fulfilled. Therefore, it is
also desirable to carry out the Private Placement to secure capital for such
repayment and thereby an extension of the Agora Bytom Loan.
The need for prompt clarification of whether it will be possible to raise
sufficient equity to repay the Bond Loan at maturity and carry out the partial
repayment of the Agora Bytom Loan makes it, in the Board's opinion, necessary to
conduct the capital raise as a private placement rather than a rights issue. A
rights issue would take substantially longer to complete, and this could
significantly impair the Company's options in the period up to the maturity of
the Bond Loan.
Subject to the successful completion of the Private Placement, the Board will
propose to the EGM that a Subsequent Offering is carried out, directed at
shareholders in the Company as of 6 November 2023 (as registered in the VPS on 8
November 2023) who (i) were not contacted during the "wall-crossing phase" of
the Private Placement, (ii) were not allocated Offer Shares in the Private
Placement, and (iii) are not domiciled in a jurisdiction where such an offer
would be unlawful or, for jurisdictions other than Norway, require any
prospectus, filing, registration or similar action. Such shareholders will be
granted non-transferable subscription rights to subscribe for and be allocated
new shares in the Subsequent Offering. The subscription price in the Subsequent
Offering will be equal to the Subscription Price in the Private Placement.
Oversubscription will be permitted, but subscription without subscription rights
will not be permitted. The net proceeds from the Subsequent Offering will be
used for general corporate purposes.
Against this background, and based on an assessment of the current conditions in
the stock markets, the Board has considered the Private Placement to be in the
common interest of the Company and its shareholders. Due to the structure of the
Private Placement, the shareholders' preferential rights will be waived.
For further information, please contact:
Pål Feen Larsen, CEO Borgestad ASA, +47 488 45 333
This information is considered to be inside information pursuant to the EU
Market Abuse Regulation and is subject to the disclosure requirements pursuant
to section 5-12 the Norwegian Securities Trading Act.
This stock exchange announcement was published by Pål Feen Larsen, CEO in
Borgestad ASA on 6 November 2023 at 16:32 CET on behalf of the Company.
--
About Borgestad| www.borgestad.no
Borgestad ASA (OSE:BOR) is an investment company focused on real estate and
industry. The key investments include Agora Bytom shopping center and the
leading refractory manufacturer Höganäs Borgestad.
About Höganäs Borgestad | https://hoganasborgestad.com/
Höganäs Borgestad develops, manufactures and delivers refractory products,
installations and turnkey solutions that enhance the productivity and
competitiveness of industrial customers. The aim is to contribute to the
customers' profitability by providing high-value refractory solutions to their
challenges. Today, the company is a leading supplier in the refractory market of
the Nordic countries and has a global presence in a number of selected
application areas.
IMPORTANT NOTICE:
The information contained in this announcement is for background purposes only
and does not purport to be full or complete. No reliance may be placed for any
purpose on the information contained in this announcement or its accuracy,
fairness or completeness. Neither Arctic Securities AS nor SpareBank 1 Markets
AS (the "Managers") or any of their affiliates or any of their respective
directors, officers, employees, advisors or agents accepts any responsibility or
liability whatsoever for, or makes any representation or warranty, express or
implied, as to the truth, accuracy or completeness of the information in this
announcement (or whether any information has been omitted from the announcement)
or any other information relating to the Company, its subsidiaries or associated
companies, whether written, oral or in a visual or electronic form, and
howsoever transmitted or made available, or for any loss howsoever arising from
any use of this announcement or its contents or otherwise arising in connection
therewith. This announcement has been prepared by and is the sole responsibility
of the Borgestad ASA (the "Company").
Neither this announcement nor the information contained herein is for
publication, distribution or release, in whole or in part, directly or
indirectly, in or into or from Australia, Canada, Japan, Hong Kong, South Africa
or the United States (including its territories and possessions, any State of
the United States and the District of Columbia) or any other jurisdiction where
to do so would constitute a violation of the relevant laws of such jurisdiction.
The publication, distribution or release of this announcement may be restricted
by law in certain jurisdictions and persons into whose possession any document
or other information referred to herein should inform themselves about and
observe any such restriction. Any failure to comply with these restrictions may
constitute a violation of the securities laws of any such jurisdiction.
This announcement is not an offer for sale of securities in the United States.
The securities referred to in this announcement have not been and will not be
registered under the U.S. Securities Act, and may not be offered or sold in the
United States absent registration with the U.S. Securities and Exchange
Commission or an exemption from, or in a transaction not subject to, the
registration requirements of the U.S. Securities Act and in accordance with
applicable U.S. state securities laws. The Company does not intend to register
any securities referred to herein in the United States or to conduct a public
offering of securities in the United States.
This announcement is an advertisement and is not a prospectus for the purposes
of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14
June 2017 (the "EU Prospectus Regulation") (together with any applicable
implementing measures in any Member State). All of the securities referred to in
this announcement will be made by means of a set of subscription materials
provided to potential investors, except for the subsequent repair offering which
will be made on the basis of a listing and offering prospectus. Investors should
not subscribe for any securities referred to in this announcement except on the
basis of information contained in the aforementioned subscription materials or
for the subsequent repair offering, the prospectus.
In any EEA Member State, this communication is only addressed to and is only
directed at qualified investors in that Member State within the meaning of the
EU Prospectus Regulation, i.e. only to investors who can receive the offer
without an approved prospectus in such EEA Member State.
This communication is only being distributed to and is only directed at persons
in the United Kingdom that are "qualified investors" within the meaning of the
EU Prospectus Regulation as it forms part of English law by virtue of the
European Union (Withdrawal) Act 2018 and that are (i) investment professionals
falling within Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005, as amended (the "Order") or (ii) high net
worth entities, and other persons to whom this announcement may lawfully be
communicated, falling within Article 49(2)(a) to (d) of the Order (all such
persons together being referred to as "relevant persons"). This communication
must not be acted on or relied on by persons who are not relevant persons. Any
investment or investment activity to which this communication relates is
available only to relevant persons and will be engaged in only with relevant
persons. Persons distributing this communication must satisfy themselves that it
is lawful to do so.
This announcement is made by, and is the responsibility of, the Company. The
Managers and their affiliates are acting exclusively for the Company and no-one
else in connection with the transactions described in this announcement. They
will not regard any other person as their respective clients in relation to the
transactions described in this announcement and will not be responsible to
anyone other than the Company, for providing the protections afforded to their
respective clients, nor for providing advice in relation to the transactions
described in this announcement, the contents of this announcement or any
transaction, arrangement or other matter referred to herein.
In connection with the transaction described in this announcement, the Managers
and any of their affiliates, acting as investors for their own accounts, may
subscribe for or purchase securities and in that capacity may retain, purchase,
sell, offer to sell or otherwise deal for their own accounts in such securities
of the Company or related investments in connection with the transactions
described in this announcement or otherwise. Accordingly, references in any
subscription materials to the securities being issued, offered, subscribed,
acquired, placed or otherwise dealt in should be read as including any issue or
offer to, or subscription, acquisition, placing or dealing by, the Managers and
any of their affiliates acting as investors for their own accounts. The Managers
does not intend to disclose the extent of any such investment or transactions
otherwise than in accordance with any legal or regulatory obligations to do so.
Matters discussed in this announcement may constitute forward-looking
statements. Forward-looking statements are statements that are not historical
facts and may be identified by words such as "believe", "aim", "expect",
"anticipate", "intend", "estimate", "will", "may", "continue", "should" and
similar expressions. The forward-looking statements in this release are based
upon various assumptions, many of which are based, in turn, upon further
assumptions. Although the Company believes that these assumptions were
reasonable when made, these assumptions are inherently subject to significant
known and unknown risks, uncertainties, contingencies, and other important
factors which are difficult or impossible to predict and are beyond its control.
Such risks, uncertainties, contingencies, and other important factors could
cause actual events to differ materially from the expectations expressed or
implied in this release by such forward-looking statements. Forward-looking
statements speak only as of the date they are made and cannot be relied upon as
a guide to future performance. The Company, the Managers and their respective
affiliates expressly disclaims any obligation or undertaking to update, review
or revise any forward-looking statement contained in this announcement whether
as a result of new information, future developments or otherwise. The
information, opinions and forward-looking statements contained in this
announcement speak only as at its date and are subject to change without notice.