2016-11-03 07:50:01 CET
2016-11-03 07:50:01 CET
REGLAMENTUOJAMA INFORMACIJA
Norvestia - Company Announcement
CapMan makes a voluntary public exchange offer for Norvestia
Board of Directors of Norvestia recommends to accept the exchange offer and
convenes an Extraordinary General Meeting of Norvestia to resolve on extra
dividend
Helsinki, Finland, 2016-11-03 07:50 CET (GLOBE NEWSWIRE) --
Norvestia Oyj Stock Exchange Release 3 November 2016 at 8:50
This stock exchange release may not be published or distributed, in whole or in
part, directly or indirectly, in the United States of America, Australia,
Canada, Hong Kong, Japan, New Zealand, South Africa, or any other country where
such publication or distribution would violate applicable regulation or would
require additional measures in addition to the requirements under Finnish law.
CapMan makes a voluntary public exchange offer for Norvestia – Board of
Directors of Norvestia recommends to accept the exchange offer and convenes an
Extraordinary General Meeting of Norvestia to resolve on extra dividend
CapMan Plc (“CapMan”) has today announced a voluntary public exchange offer for
all Norvestia Oyj’s (“Norvestia”) shares and securities entitling to shares in
Norvestia, which are not held by Norvestia or CapMan Group (“Exchange Offer”).
Before the Exchange Offer, CapMan holds 28.7 percent of Norvestia’s shares.
CapMan’s Exchange Offer in brief:
-- In the Exchange Offer, CapMan offers as a share consideration six (6) new
shares of CapMan (“Offer Consideration”) for each share and security
entitling to shares in Norvestia.
-- Norvestia’s Board of Directors proposes to convene Norvestia’s
Extraordinary General Meeting to be held on 8 December 2016 to resolve on
an extra dividend of EUR 3.35 per share (“Extra Dividend”) to Norvestia’s
shareholders before the completion of the Exchange Offer, conditional upon
the completion of the Exchange Offer.
-- The Offer Consideration corresponds to a premium of approximately 23.2 per
cent in comparison to Norvestia’s volume-weighted average share price on
Nasdaq Helsinki Ltd (the “Helsinki Stock Exchange”) in the 30-day period
before the announcement of the Exchange Offer ending on 2 November 2016
less the Extra Dividend (EUR 5.94), when the Offer Consideration is valued
at the volume-weighted average share price of CapMan in the same period
(EUR 1.22).
-- The Offer Consideration corresponds to a premium of approximately 21.0 per
cent in comparison to the closing price of Norvestia share on the Helsinki
Stock Exchange on 2 November 2016 less the Extra Dividend (EUR 6.15), based
on the closing price of the CapMan share (EUR 1.24) on the same day.
-- The total value of the Exchange Offer, taking into account the Extra
Dividend, is approximately EUR 117.9 million based on the closing price of
CapMan’s share (EUR 1.24) on 2 November 2016. Correspondingly, the total
value of the Exchange Offer is approximately EUR 116.6 million based on the
volume-weighted average share price of CapMan’s share (EUR 1.22) in the
30-day period prior to the announcement of the Exchange Offer ending on 2
November 2016.
-- Each new CapMan share offered as the Offer Consideration carry one (1) vote
and equal rights as the existing CapMan shares to dividend and other
distributions of CapMan’s assets. CapMan has confirmed that it will not
make any distributions from the company during the offer priod up until the
completion trades of the Exchange Offer have been settled. Subject to (and
before) completion of the transaction, all CapMan’s Series A shares will be
converted into Series B shares (1:1) and the Articles of Association will
be amended so that CapMan only has one share series.
-- CapMan has announced that the offer period of the Exchange Offer is
intended to begin on or about 21 November 2016 and is initially intended to
end on 16 December 2016, unless the offer period is extended. The combined
exchange offer document and listing prospectus (“Offer Document”),
including the unaudited pro forma financial information illustrating the
financial effects of the combination of CapMan and Norvestia, is expected
to be published on or about 18 November 2016.
-- The new CapMan shares offered as the Offer Consideration are intended to be
issued in a directed share issue. CapMan’s Board of Directors have proposed
that CapMan’s Extraordinary General Meeting to be convened on 8 December
2016 will grant the Board of Directors the necessary share issue
authorisation to complete the Exchange Offer. As of the date of the
publication of the Exchange Offer, shareholders representing approximately
60.3 per cent of the aggregate votes in CapMan have agreed to vote in
favour of the authorisation for the directed share issue. As part of the
arrangement, all CapMan’s A-shareholders have agreed to convert their
A-shares into B-shares in accordance with CapMan’s Articles of Association
so that one (1) A-share corresponds to one (1) B-share and to vote at
CapMan’s Extraordinary General Meeting in favour of amending CapMan’s
Articles of Association so that CapMan only has one share series. The
conversion and the vote in favour of amending the Articles of Association
are conditional to CapMan’s announcement that it will complete the Exchange
Offer. The changes to the Articles of Association will be registered before
the Exchange Offer is completed. Upon such registration, all shares in
CapMan confer equal rights.
-- The Exchange Offer is conditional, inter alia, to CapMan obtaining, in
total, more than ninety (90) per cent of the issued and outstanding shares
and votes in Norvestia through the Exchange Offer, to CapMan’s
Extraordinary General Meeting deciding on a directed share issue
authorisation to the board of directors be used to complete the Exchange
Offer, to Norvestia’s independent board members having unanimously
recommended to accept the Exchange Offer and such recommendation not having
been cancelled or changed in this respect and to no material adverse change
having occurred in Norvestia as described in more detail in the terms of
the Exchange Offer. CapMan reserves the right to waive the fulfilment of
the conditions of the Exchange Offer, including waiving the condition
concerning obtaining ninety (90) per cent of ownership, and may consummate
the Exchange Offer also based on an ownership of less than ninety (90) per
cent of Norvestia’s shares. The conditions for completion of the Exchange
Offer are presented as an attachment in the enclosed CapMan’s release.
-- CapMan has announced that if CapMan receives more than ninety (90) per cent
of all shares and votes in Norvestia, CapMan intends to acquire the
remaining shares in Norvestia through redemption proceedings in accordance
with Chapter 18 of the Companies Act and apply for delisting of Norvestia’s
shares from the Helsinki Stock Exchange.
Norvestia’s Board of Directors have formed a composition consisting of Hannu
Syrjänen, Georg Ehrnrooth and Arja Talma, being Norvestia’s Board members
independent of CapMan, to evaluate, handle and make resolutions in relation to
the Exchange Offer. Members of Norvestia’s Board who are not independent of
CapMan, i.e. Heikki Westerlund and Niko Haavisto, have not in any way
participated and will not participate in the assessment and/or decision-making
related to the Exchange Offer in Norvestia’s Board of Directors.
Norvestia’s Board of Directors have been informed that Sampo Plc (on behalf of
Norvestia’s major shareholders Mandatum Life and Mutual Limited Liability
Insurance Company Kaleva), Mr Mikko Laakkonen, Mr Hannu Laakkonen and Mr Jukka
Immonen, who together with CapMan represent approximately 50.8 per cent of all
shares and votes in Norvestia prior to the Exchange Offer, have given an
undertaking, subject to certain conditions, to accept the Exchange Offer. The
same shareholders and CapMan have also committed to vote in favour of the Extra
Dividend at Norvestia’s extraordinary general meeting. Mikko and Hannu
Laakkonen, Jukka Immonen as well as Sampo Oyj may cancel their commitments in
certain situations, for instance if Norvestia’s Board of Directors cancels its
recommendation to accept the Exchange Offer.
Norvestia’s Board of Directors (in the aforementioned composition) has assessed
the Exchange Offer, deems the terms of the Exchange Offer to be economically
fair and recommends that Norvestia’s shareholders accept the Exchange Offer.
Norvestia’s financial advisor Nordea Corporate & Investment Banking has issued
to Norvestia a fairness opinion statement on the Exchange Offer. Norvestia’s
Board of Directors will publish its final statement on the Exchange Offer as
referred to in the Securities Market Act before the publication of the Offer
Document.
Hannu Syrjänen, Vice Chairman of Norvestia’s Board of Directors, comments the
Exchange Offer in CapMan’s stock exchange release relating to the Exchange
Offer:
“The Combination is a strategic step, as CapMan’s expertise and resources are
well-suited to support the implementation of Norvestia’s Growth Equity strategy
and future growth. In addition, the combination enables synergies. The combined
group is a larger operating entity and has a broader investor base, which
present Norvestia’s shareholders with an opportunity for improved liquidity as
shareholders of the combined group. The Exchange Offer provides Norvestia’s
shareholders with a marked premium compared to the share price, taking into
account Norvestia’s Extra Dividend. Norvestia’s Board of Directors recommends
that shareholders accept the Exchange Offer.”
CapMan’s stock exchange release relating to the Exchange Offer is enclosed to
this stock exchange release. The release contains, among others, CapMan’s
description of the intentions and objectives of the proposed combination, the
comments of CapMan’s management, CapMan’s description of the combined group,
additional information on the Exchange Offer and an invitation to CapMan’s
press, analyst and investor conference held today, on 3 November 2016, at 10:00
a.m.(in Finnish) where Norvestia’s Vice Chairman Hannu Syrjänen will also be
present.
In relation to the Exchange Offer, Norvestia has committed to comply with the
recommendation referred to in Chapter 11, Section 28 of the Securities Markets
Act (Helsinki Takeover Code).
Nordea Corporate & Investment Banking acts as Norvestia’s financial advisor and
Hannes Snellman Attorneys Ltd. acts as Norvestia’s legal advisor in relation to
the Exchange Offer.
Helsinki, 3 November 2016
NORVESTIA OYJ
Board of Directors
Additional information:
Hannu Syrjänen, Vice Chairman of the Board
tel. +358 400 454 885 (also present at CapMan’s press conference)
ENCLOSURE: CAPMAN PLC’S STOCK EXCHANGE RELEASE
CapMan Plc Stock Exchange Release 3 November 2016 at 8.35 a.m.
This stock exchange release may not be published or distributed, in whole or in
part, directly or indirectly, in or into or to any person located or a resident
of the United States of America, Australia, Canada, Hong Kong, Japan, New
Zealand, South Africa, or any other country where such publication or
distribution would violate applicable regulation or would require additional
measures in addition to the requirements under Finnish law.
CapMan Plc offers to acquire Norvestia Oyj – Norvestia’s Board of Directors
recommends accepting the voluntary exchange offer
Highlights of the arrangement:
-- Norvestia strengthens CapMan’s position significantly as a leading Nordic
private equity asset management and investment company.
-- The combined turnover of the Combined Group would have been approx. €27.2
million, operating profit approx. €21.8 million and earnings per share
approx. €0.11 for the period of 1 January - 30 September 2016.1)
-- The Combined Group’s strengthened balance sheet and the own investment
capacity of approximately € 200 million enables faster growth.
-- CapMan expects the arrangement to generate cost and financing synergies
exceeding €3 million per annum.
-- The Management Company and Services business pursuing growth, a strong
balance sheet and operating cash flow provides a foundation for the
execution of the dividend policy. CapMan’s objective is to pay at least 75
per cent of its earnings per share as dividend following the consummation
of the arrangement.
-- If the exchange offer materialises, all CapMan’s Series A shares will be
converted into Series B shares (1:1) and the Articles of Association will
be amended so that CapMan only has one share series.
-- Norvestia’s Board of Directors recommends that Norvestia’s shareholders
accept the Exchange Offer. Norvestia’s Board of Directors proposes to
Norvestia’s extraordinary general meeting that an extraordinary dividend of
€ 3.35 per share be paid before the consummation of the exchange offer,
conditional on the consummation of the exchange offer.
-- After the dividend payment, CapMan’s Offer Consideration is six (6)
CapMan’s shares for each Norvestia’s share and security entitling to a
share. The Offer Consideration corresponds to a premium of approximately
23.2 per cent in comparison to Norvestia's volume-weighted average share
price less the Extraordinary Dividend (€ 5.94) over the reference period 4
October - 2 November 2016.
-- Total value of the exchange offer, taking into account the extraordinary
dividend, is in total approx. € 117.9 million based on the closing price of
CapMan’s share (€ 1.24) on 2 November 2016. Correspondingly, the total
value of the exchange offer is in total approx. € 116.6 million based on
the volume-weighted average share price (€ 1.22 over the reference period 4
October - 2 November 2016.
1. Illustrative unaudited combined key figures of the Combined Group
CapMan Plc (“CapMan” or the “Company”) offers to acquire all of Norvestia Plc’s
(“Norvestia”) shares (“Norvestia’s shares”) and securities entitling to shares
which are not held by Norvestia Group or CapMan Group in a voluntary public
tender offer (“Exchange Offer”). Before the Exchange Offer, CapMan holds 28.7
per cent of Norvestia’s shares.
In the Exchange Offer, CapMan offers six (6) new shares of the Company (“Offer
Consideration”) for each Norvestia’s share. In conjunction with the
arrangement, Norvestia’s Board of Directors proposes to Norvestia’s
extraordinary general meeting that an extraordinary dividend of € 3.35 per
share be paid (“Extraordinary Dividend”). The Extraordinary Dividend is
conditional on the consummation of the Exchange Offer and is paid to those
Norvestia shareholders, who own Norvestia’s shares when CapMan announces that
the conditions for consummating the Exchange Offer have been fulfilled and
CapMan will consummate the Exchange Offer (“Exchange Offer Confirmation Date”).
The aforementioned arrangements offer Norvestia’s shareholders the opportunity
to receive a considerable Extraordinary Dividend while continuing as
shareholders in the group combining the businesses of CapMan and Norvestia
(“Combination” and “Combined Group”).
The Offer Consideration corresponds to a premium of approximately 23.2 per cent
in comparison to Norvestia’s volume-weighted average share price less the
Extraordinary Dividend (€ 5.94) on Nasdaq Helsinki Ltd (the “Helsinki Stock
Exchange”) in the 30-day period prior to the announcement of the Exchange Offer
ending on 2 November 2016, when the Offer Consideration is valued at the
volume-weighted average share price of CapMan in the same period (€ 1.22).
The Offer Consideration corresponds to a premium of approximately 21.0 per cent
in comparison to the Norvestia share's closing price less the Extraordinary
Dividend (€ 6.15) on the Helsinki Stock Exchange on 2 November 2016 based on
the closing price of the CapMan share (€ 1.24) on the same day.
Total value of the exchange offer, taking into account the Extraordinary
Dividend, is approximately € 117.9 million based on the closing price of
CapMan’s share (€ 1.24) on 2 November 2016. Correspondingly, the total value of
the exchange offer is approx. € 116.6 million based on the volume-weighted
average share price (€ 1.22) over the reference period 4 October - 2 November
2016.
Each new CapMan share under the Offer Consideration carry one (1) vote and
together with the existing shares equal rights to dividend and other
distributions of Company’s assets to shareholders. CapMan will not make any
distributions from the Company before the consummation of the Exchange Offer.
Norvestia’s Board of Directors have formed a composition to evaluate and
process the Exchange Offer consisting of Hannu Syrjänen, Georg Ehrnrooth and
Arja Talma, who are Norvestia’s Board of Directors independent of CapMan.
Members of Norvestia’s Board of Directors who are not independent of CapMan,
that is, Heikki Westerlund and Niko Haavisto, have not in any way participated
in the decision making related to the matter in Norvestia’s Board of Directors.
Norvestia’s Board of Directors in its aforementioned composition has stated
that it deems the terms of the Exchange Offer are economically fair, and that
it recommends that Norvestia’s shareholders accept the Exchange Offer.
Norvestia’s financial advisor Nordea Corporate & Investment Banking has
prepared a fairness opinion statement for Norvestia on the Exchange Offer.
Norvestia’s Board of Directors will publish its final statement on the Exchange
Offer in line with the Securities Market Act before the publication of the
Offer Document.
Sampo Plc (on behalf of Norvestia’s major shareholders Mandatum Life and Mutual
Limited Liability Insurance Company Kaleva), Mr Mikko Laakkonen, Mr Hannu
Laakkonen and Mr Jukka Immonen, who together with CapMan represent approx. 50.8
per cent of all shares and votes prior to the Exchange Offer, have given an
undertaking, subject to certain conditions, to accept the Exchange Offer and
vote in favour of the Extraordinary Dividend at Norvestia’s extraordinary
general meeting. Mikko and Hannu Laakkonen, Jukka Immonen as well as Sampo Oyj
may cancel their commitments in certain situations, for instance if Norvestia’s
Board of Directors cancels their recommendation to accept the Exchange Offer.
CapMan is also committed to vote in favour of the Extraordinary Dividend in
Norvestia’s extraordinary general meeting.
CapMan has no undertakings with regard to any compensation or other fees
payable to the management and/or Board of Directors of Norvestia as a result of
consummation of the Exchange Offer. CapMan and Norvestia’s shareholders have
not agreed on any additional arrangements related to the offer.
The new CapMan shares offered as the Offer Consideration are intended to be
issued in a directed share issue. CapMan’s Board of Directors will propose that
CapMan’s extraordinary general meeting to be convened on 8 December 2016 will
grant the Board of Directors with the necessary authorisation. As of the date
of the publication of the Exchange Offer, shareholders representing
approximately 60.3 per cent of the aggregate votes in CapMan have agreed to
vote in favour of the authorisation for the directed share issue. As part of
the arrangement, all of CapMan’s A-shareholders have agreed to convert their
A-shares into B-shares in accordance with CapMan’s articles of association so
that one (1) A-share corresponds to one (1) B-share and to vote at CapMan’s
extraordinary general meeting in favour of amending CapMan’s Articles of
Association so that CapMan only has one share series. The conversion and the
vote in favour of amending the Articles of Association are conditional to
CapMan’s announcement that it will consummate the Exchange Offer. The changes
to the Articles of Association will be registered before the Exchange Offer is
consummated.
The offer period of the Exchange Offer is intended to begin on or about 21
November 2016 and is initially intended to end on 16 December 2016, unless the
offer period is extended (the “Offer Period”). The combined exchange offer
document and listing prospectus, including the unaudited pro forma financial
information illustrating the financial effects of the combination of CapMan and
Norvestia, is expected to be published on or about 18 November 2016 (“Offer
Document”).
The Exchange Offer is conditional, inter alia, to CapMan obtaining, in the
aggregate, more than ninety (90) per cent of the issued and outstanding shares
and votes in Norvestia through the Exchange Offer, CapMan’s extraordinary
general meeting authorising the Board of Directors to decide on the directed
share issue to be used for the consummation of the Exchange Offer, and no
material adverse change having occurred in Norvestia as described in more
detail in the terms of the Exchange Offer. In the event that the Company
acquires ownership of more than ninety (90) per cent of all shares and votes
granted by the shares in Norvestia, CapMan’s intention is to redeem any
possible minority holdings and to request for permission to delist Norvestia’s
shares from the Helsinki Stock Exchange. CapMan reserves the right to waive the
fulfilment of the conditions of the Exchange Offer, including waiving the
condition concerning obtaining ninety (90) per cent of ownership, and may
consummate the Exchange Offer also based on an ownership of less than ninety
(90) per cent of Norvestia’s shares. The conditions for the consummation of the
Exchange Offer are presented as an attachment to this release.
The purpose and objectives of the proposed Combination
The Combined Group is expected to create added value to both CapMan’s and
Norvestia’s shareholders based on growth, benefits from operating as a larger
entity in the private equity field, a more effective utilisation of the
existing asset base, as well as tangible cost synergies, among others. The
objective of the Combined Group is to offer the best private equity experience
and have a positive impact on the economic development of its stakeholders.
Key strategic growth themes
-- The utilisation of CapMan’s brand and network in versatile investment
activities:
CapMan has a long-standing operating history and is a front-runner in
private equity, especially in the Nordic countries. Due to its position,
CapMan is well-positioned to evaluate deal flow, i.e. investment
opportunities available in the market. CapMan is well-equipped to make use
of these opportunities within existing investment strategies or by creating
new funds or solutions tailored to suitable groups of investors.
-- A versatile selection of investment strategies and services:
CapMan’s objective is to offer the best private equity experience by
developing innovative and effective solutions that offer attractive returns
for investors. For example, the intention is to expand investments in
growth equity by utilising CapMan’s current resources and expertise.
-- The launch of new investment solutions:
Fund raising and making investments from fund proceeds in line with their
respective investment strategies continues as a central part of CapMan’s
business operations. In addition, in areas where CapMan does not have
actively investing funds, CapMan may make investments directly from its own
balance sheet in the form of a new so called “Tactical Opportunity”
investment strategy as well as sell such investment interests to investors.
CapMan may also offer liquidity for its fund investors by buying and
selling fund interests in the secondary market.
-- Result oriented business culture:
CapMan’s larger investment capacity allows for more flexibility and
enables quicker investment decisions. A more active balance sheet
management emphasises the significance of ownership as it relates to
performance. CapMan’s and Norvestia’s combined and diverse personnel
resources allow further development of existing products and developing and
introducing new products. A stronger CapMan is also an attractive employer.
Active and efficient use of own balance sheet supports developing the business
-- A significantly stronger investment capacity combined with a net gearing
objective of on average no more than 40 per cent reduces the dependency of
the business of external fundraising and increases the efficiency of the
investment business. Own investment capacity of around € 200 million will
be allocated more actively into private equity investments in the future,
including investments into private equity funds, growth equity and Tactical
Opportunity investments. A more active allocation of the investment
capacity from market investments to the unlisted market will improve the
return profile of the investment portfolio.
Significant synergies
-- The annual cost and financing synergies generated by the combination are
expected to exceed €3 million per annum as a result of removal of
overlapping operations, lower fixed costs, centralised administration and
reduced financial costs, among other factors.
Objective to grow dividend
-- The Management Company and Services business that pursues selective and
profitable growth, a strong balance sheet and good operating cash flow,
creates a foundation for executing an active dividend policy. CapMan’s
objective is to pay at least 75 per cent of its earnings per share as
dividend following the consummation of the Combination.
Comments of the management of CapMan and Norvestia
Heikki Westerlund, CEO of CapMan
“Private equity is a growing field that interests a broader investor base. As
one of the front-runners in the field, we have offered our customers diverse
investment strategies for more than 25 years. Strong focus on value creation
abilities and the creation of products that are based on such value creation is
at the core of our growth strategy. Norvestia strengthens CapMan’s position as
a solid and leading Nordic private equity asset management and investment
company.
We have been an anchor owner of Norvestia since May 2015, when CapMan became
the largest single shareholder of Norvestia. We identify excellent growth
opportunities in, among others, the Growth Equity strategy that invests in
unlisted companies, but it is difficult to build growth on Norvestia’s
well-managed Market Investments portfolio. We have an extensive private equity
experience especially as active value creation professionals, a broad and
international customer base, good access to potential investments and a strong
brand.
After the consummation of the Exchange Offer, CapMan’s own investment capacity
will be around € 200 million. In the future, own investments will be made in
the private equity asset class both through our own funds as well as direct
investments in growth companies. We are also evaluating the possibility to
utilise our own balance sheet actively in areas, which are not covered by the
investment strategies implemented by our current funds. We may, for example,
introduce new investment strategies, or offer liquidity to our fund investors.
Further streamlining of cost structures supports our objective to improve
profitability of our Management Company and Services business. I believe that
the Combined Group will create added value to shareholders, investors and other
stakeholders that are central to our business.”
Karri Kaitue, Chairman of the Board of CapMan
“Adding Norvestia as part of CapMan is a logical continuation of the Company’s
long-term strategy. CapMan’s scalable business model and experienced
organisation in combination with Norvestia’s strong balance sheet and a
well-managed investment portfolio create a strong foundation for growth. The
Combined Group is a significantly larger business entity compared to either
CapMan or Norvestia in their current forms, which benefits the shareholders,
clients and employees of both companies. The profitable growth pursued by the
Management Company and Services business, strong balance sheet and operating
cash flow create a solid foundation for the delivery and execution of our
strategy and financial target setting.”
Hannu Syrjänen, Vice Chairman of the Board of Norvestia
“The Combination is a strategic step, as CapMan’s expertise and resources are
well-suited to support the implementation of Norvestia’s Growth Equity strategy
and future growth. In addition, the Combination enables synergies. The Combined
Group is a larger operating entity and has a broader investor base, which
present Norvestia’s shareholders with an opportunity for improved liquidity as
shareholders of the Combined Group. The Exchange Offer provides Norvestia’s
shareholders with a marked premium compared to the share price, taking into
account Norvestia’s Extraordinary Dividend. Norvestia’s Board of Directors
recommends that shareholders accept the Exchange Offer.”
The Combined Group
General overview
Norvestia is a public listed investment company with operating profit of € 15.3
million and earnings per share of 84 cents for the period of 1 January - 30
September 2016. On 30 September, Norvestia had seven employees and
approximately €182.1 million in investments. The Combination strengthens
CapMan’s position as an international private equity investment and asset
management company. The Combined Group will offer investment opportunities to
the growing client base investing in the asset class. The Combined Group
combines versatile investment strategies and themes with actively managed
balance sheet investments. The Combined Group has two business segments, the
“Management Company and Services” business and the “Investment” business.
Management Company and Services business
The Combined Group will manage assets that have been invested according to
various investment strategies mainly through own funds, but also through
solutions tailored for customers. The main investment strategies under the
Management Company and Services business are real estate investments (“Real
Estate”), buyout investments (“Buyout”), private debt investments (“Credit”)
and minority investments to Russia (“Russia”). The Combined Group offers
specialised private equity services through a purchasing scheme for growth
companies, private equity investors and other fund managers operating in the
industry. The Combined Group strives to develop its service offering further.
Management fees are, in general, a highly predictable source of income, and
provide, in combination with other fees from services in private equity, stable
cash flow to the business. In addition, the management company is entitled to
carried interest, which is a portion of a fund’s cash flow after deductions
from the return of paid-in capital to the fund investors and the preferential
annual return. Where a fund’s investment activity is successful, carried
interest income increases the Combined Group’s return on equity. In terms of
fund advisory services, a successful fundraising typically generates one-off
success fees.
Investment business
The Combined Group utilises its expertise and significant investment capacity
to actively invest in the private equity asset class. Investments are made into
the Combined Group’s own investment strategies mainly through funds that invest
in the strategies. Growth Equity investments and Tactical Opportunity
investments will be made directly from the Combined Group’s balance sheet.
Income from the Investment business is based on fair value changes of such
investments and realised cash flow.
Illustrative unaudited combined key figures of the Combined Group
Principles
The unaudited financial information presented below are based on CapMan’s 2015
financial statements, Norvestia’s adjusted income statement information for the
financial year 2015 and the interim financial information for 1 January - 30
September 2016 for both companies. The combined financial information is
presented for illustrative purposes. The combined financial information
represents the turnover and result of the Combined Group as if the combination
would have occurred in the beginning of the last financial year. The
illustrative key figures of the Combined Group for the balance sheet are shown
as if the Combination would have occurred on 30 September 2016. The combined
financial information is based on a hypothetical situation and are not to be
considered as pro forma financial information, which CapMan will publish in the
Offer Document, which it submits to the Financial Supervisory Authority around
3 November 2016, as the allocation of the Offer Consideration, the costs
related to the arrangement or accounting principles and differences in forms of
presentation have not been taken into account in this instance. The preliminary
difference between the Offer Consideration and Norvestia’s equity is presented
in the balance sheet key figures under equity.
Combined key figures for the income statement and balance sheet have been
adjusted for the fair value of CapMan’s ownership of Norvestia’s shares as well
as the distribution of the Extraordinary Dividend as presented in the reference
information below.
Illustrative unaudited combined income statement key figures of the Combined
Group
1.1.-30.9.2016 1.1.-31.12.2015
MEUR Combined CapMan Norves Combined CapMan Norves
Group tia Group tia
--------------------------------------------------------------------------------
Turnover 27.2 22.0 5.2 37.4 31.8 5.7
Operating income 1) 21.8 10.0 15.3 32.4 9.3 27.5
Income before taxes1) 19.2 7.5 15.1 29.7 6.4 27.7
Profit for the period1) 17.1 7.1 12.9 27.6 6.1 25.0
Earnings per share for the 0.11 0.18
period, undiluted (eur) 1)
2)
Earnings per share for the 0.11 0.17
period, diluted (eur) 1) 3)
Illustrative unaudited combined balance sheet key figures of the Combined Group
30.9.2016
MEUR Combined CapMan Norvesti
Group a
--------------------------------------------------------------------------------
Fair value of investments through profit and 86.8 98.0 37.6
loss4)
Long-term assets, total 4) 105.8 116.9 37.6
Fair value of financial assets through profit 93.6 0.3 125.1
and loss5)
Short-term assets, total5) 144.4 35.5 145.4
Equity, total4) 5) 150.8 66.3 169.8
Long-term liabilities, total 73.3 67.0 6.3
Short-term liabilities, total 26.0 19.1 6.9
Illustrative unaudited combined key figures of the Combined Group
30.9.2016
-----------------------------
-----------------------------
Net gearing (%) 6) 15.2%
-- The change in the fair value of CapMan’s previously held ownership of 28.7
per cent of Norvestia is eliminated in the illustrative combined income
statement. The amount of the elimination is €4.4 million for the financial
year 2015 and €3.5 million for the period 1.1.-30.9.2016.
-- The number of shares when calculating illustrative basic earnings per share
is 151,834,716 shares for the period 1.1.-30.9.2016 and 151,825,971 shares
for the period 1.1.2015-31.12.2015.
-- The number of shares when calculating illustrative diluted earnings per
share is 153,159,716 shares for the period 1.1.-30.9.2016 and 153,050,971
shares for the period 1.1.2015-31.12.2015.
-- The value of CapMan’s previously held ownership of 28.7 per cent of
Norvestia’s shares has been eliminated from the illustrative balance sheet
information.
-- The Extraordinary Dividend of €3.35 per share has been eliminated from the
short-term assets of the illustrative combined balance sheet. The total
amount of the Extraordinary Dividend contingent to the consummation of the
Exchange offer is approx. €51.3 million. A closing price of €1.25 as of 1
November 2016 per CapMan share has been used when calculating the Offer
Consideration.
-- Calculated dividing the net of interest bearing liabilities and cash by
equity at the end of the period.
Synergies and items affecting comparability generated by the arrangement
The annual cost and financing synergies generated by the combination are
expected to exceed €3 million per annum as a result of elimination of
overlapping operations, lower fixed costs, centralised administration and
reduced financial costs, among other factors. The combined effect of the cost
and financing synergies is positive and expected to be at least €3 million per
annum. The Company expects to reach these cost and financing synergies during
2017 and in full starting from 2018.
The Combination will also offer numerous opportunities for synergies arising
from long-term returns on investing activities due to the combination of
resources and expertise.
Transaction costs and other costs arising from the Combination that affect
comparability are expected to be €3 million according to CapMan and will be
allocated to 2016 and 2017.
The impact of the Exchange Offer on the outlook for 2016
Consummation of the Exchange Offer is not expected to have impact on CapMan’s
outlook for 2016. CapMan has published its outlook for 2016 in connection with
the January–September 2016 interim report published on 3 November 2016. After
consummation of the Exchange Offer, Norvestia will continue its operations as
CapMan’s subsidiary.
Financial objectives to be updated following the consummation of the Exchange
Offer
CapMan will update its financial targets as follows, if the Exchange Offer is
consummated:
-- The annual growth target for the Management Company and Services business
is on average over 10 percent. CapMan has not previously published any such
growth targets.
-- Target ratio for net gearing (i.e. interest-bearing net debt to equity) is
on average a maximum of 40 per cent. CapMan has not previously published
any targets for net gearing. CapMan’s target range for the equity ratio is
currently at 45–60 per cent.
-- Target for the return on equity is more than 20 per cent per year on
average and will remain unchanged from the current target.
-- CapMan’s objective is to pay at least 75 per cent of the earnings per share
as dividend. CapMan’s current objective is to pay at least 60 per cent of
the earnings per share as dividend.
Key information regarding the Exchange Offer
Offer and Offer Consideration
CapMan has offered to acquire, in accordance with terms of the Exchange Offer,
through a voluntary exchange offer, all issued and outstanding Norvestia’s
shares, and subscription rights that are not held by Norvestia group or CapMan
group. In the Exchange Offer, CapMan shall offer six (6) CapMan shares for each
share and subscription right in Norvestia, provided the Exchange Offer has been
approved in accordance with its terms and the approval has not been duly
withdrawn.
CapMan holds a total of 4,393,976 of a total of 15,316,560 shares in Norvestia.
CapMan’s ownership represents 28.7 per cent of the total number of shares,
share capital and votes in Norvestia. CapMan has not acquired Norvestia’s
shares during the 12-month period preceding the Exchange Offer. The number of
shares issued as Offer Consideration (“Offer Shares”) shall be a maximum of
65,576,292 in total with a total value of € 80.0 million based on
volume-weighted average price of the B-share during the one-month period ended
on 2 November 2016. The Offer Shares correspond to approximately 75.9 per cent
of all shares in CapMan before the Exchange Offer and approximately 43.2 per
cent of all shares in CapMan after the Exchange Offer provided that the
Exchange Offer is accepted in full and all of the A-shares issued by CapMan
will be fully converted to B-shares.
The Exchange Offer will be consummated as a directed share issue of shares that
correspond to CapMan’s current B-shares. At present, CapMan has two series of
shares, A-series and B-series. Each of the Company’s A-shares is entitled to
ten (10) votes at the Company’s general meeting and each of B-shares is
entitled to one (1) vote. All shares of the Company carry equal rights to
dividend and other distributions of Company’s assets to shareholders. The
shares have no nominal value.
CapMan’s Board of Directors proposes to the extraordinary general meeting, to
be held on 8 December 2016, that the extraordinary general meeting will decide
on authorising the Board of Directors to decide on the share issue in order to
consummate the Exchange Offer as well as on the removal of the share series A,
conditional to CapMan’s confirmation that it will consummate the Exchange Offer
and that all A-shares have been converted into B-shares. All holders of
CapMan’s A-shares have consented to the conversion (1:1) conditional to
CapMan’s confirmation that it will consummate the Exchange Offer. CapMan’s
shareholders representing approximately 60.3 of all voting rights, have agreed
offer to vote in favour of the proposals presented by the Board of Directors.
The amendment of the Articles of Association will be registered before the
consummation of the Exchange Offer, after which all CapMan’s shares have equal
rights.
Based on the above-mentioned, CapMan considers that it has the necessary
capacity to implement the Exchange Offer.
Basis for pricing of the Exchange Offer
In connection with the Exchange Offer, Norvestia’s Board of Directors proposes
to Norvestia’s extraordinary general meeting to be held on 8 December 2016 that
an Extraordinary Dividend of € 3.35 per share be paid to each share in
Norvestia, conditional to the fulfilment or waiver of the conditions of the
Exchange Offer and it shall be paid to those Norvestia’s shareholders, who have
been registered in the shareholder register maintained by Euroclear Finland Oy
on the dividend record date which shall be prior to the completion trades of
the Exchange Offer. The dividend record date is intended to be the second
settlement date following the Exchange Offer Confirmation Date. The
Extraordinary Dividend shall not be paid on the Subscription Rights. The
Exchange Offer will not be consummated until the decision to pay the
Extraordinary Dividend has been made and consummated.
CapMan will not during the Offer Period until the transactions under the
Exchange Offer have been settled make decisions regarding dividends or other
distributions to its shareholders or (except for the consummation of the
Exchange Offer) the issue of shares or any rights entitling to shares, the
acquisition, disposal or pledge of own shares or any rights entitling to shares
(including pursuant to any authorisations given to the Board of Directors, or
otherwise) except for the issue of new CapMan B-shares following share
subscriptions made under CapMan’s Option Programme 2013.
The Offer Consideration corresponds to a premium of approximately 23.2 per cent
in comparison to Norvestia’s volume-weighted average share price less the
Extraordinary Dividend (€ 5.94) on the Helsinki Stock Exchange in the 30-day
period prior to the announcement of the Exchange Offer ending on 2 November
2016, when the Offer Consideration is valued at the volume-weighted average
share price of CapMan in the same period (€ 1.22).
The Offer Consideration corresponds to a premium of approximately 21.0 per cent
in comparison to the Norvestia share's closing price less the Extraordinary
Dividend (€ 6.15) on the Helsinki Stock Exchange on 2 November 2016 based on
the closing price of the CapMan share (€ 1.24) on the same day.
The Offer Consideration corresponds to a premium of approximately 12.7 per cent
in comparison to the Norvestia share's all-time highest closing price less the
Extraordinary Dividend (€6.60) on the Helsinki Stock Exchange on 3 January 2006
based on the closing price of the CapMan share (€ 1.24) on 2 November 2016.
Total value of the Exchange Offer, taking into account the Extraordinary
Dividend, is approx. € 117.9 million based on the closing price of CapMan’s
share (€ 1.24) on 2 November 2016. Correspondingly, the total value of the
Exchange Offer is approx. € 116.6 million based on the volume-weighted average
share price (€ 1.22) over a 30-day reference period prior to the announcement
of the Exchange Offer, ending on 2 November 2016.
Arrangements relating to the Exchange Offer
Sampo Plc (on behalf of Norvestia’s major shareholders Mandatum Life and Mutual
Limited Liability Insurance Company Kaleva), Mr Mikko Laakkonen, Mr Hannu
Laakkonen and Mr Jukka Immonen, who together with CapMan represent approx. 50.8
per cent of all shares and votes prior to the Exchange Offer, have made a
commitment to, subject to certain conditions, accept the Exchange Offer and
participate in Norvestia’s Extraordinary General Meeting with all their shares
and votes and vote in favour of the Board of Directors’ proposal to distribute
the Extraordinary Dividend. Sampo Oyj, Mikko and Hannu Laakkonen and Jukka
Immonen may cancel their commitments in certain situations, for instance if
Norvestia’s Board of Directors cancels their recommendation to accept the
Exchange Offer.
Norvestia’s Board of Directors proposes to Norvestia’s extraordinary general
meeting to be held on 8 December 2016 that the Extraordinary Dividend be paid
conditional to the fulfilment or waiver of the conditions of the Exchange Offer
and that the dividend record date, which defines the shareholders entitled to
the Extraordinary Dividend, is set before the transactions consummating the
Exchange Offer. The decision is effective until the beginning of the next
annual general meeting. The Exchange offer will not be consummated until the
decision to pay the Extraordinary Dividend has been made and consummated. The
Extraordinary Dividend will be paid to each shareholder in Norvestia who is
registered in the company's register of shareholders maintained by Euroclear
Finland Ltd on the record date of the dividend. It is intended that the
dividend record date is the second settlement date following the Exchange Offer
Confirmation Date. Norvestia’s Board of Directors proposes that the dividend
shall be paid on the fifth banking day after the record date of the dividend.
CapMan has not committed to pay any compensation or fees to Norvestia’s
management and/or Board of Directors due to the consummation of the Exchange
Offer.
CapMan reserves the right to buy Norvestia’s shares during the Offer Period in
public trading on the Helsinki Stock Exchange or otherwise.
According to CapMan’s understanding the consummation of the Exchange Offer does
not require any permits, approvals or clearances from authorities other than
the Finnish Financial Supervisory Authority approval.
Compliance with the recommendation set forth in Chapter 11 Section 28 of the
Finnish Securities Markets Act
CapMan undertakes to comply with the Helsinki Takeover Code issued by the
Finnish Securities Market Association, which is referred to in Section 28 of
Chapter 11 of the Finnish Securities Markets Act.
Future plans regarding Norvestia’s shares and Norvestia
CapMan’s intention is to acquire all shares and Subscription Rights in
Norvestia and not held by Norvestia Group or CapMan Group. If the Exchange
Offer is consummated in such a way where CapMan receives more than ninety (90)
per cent of all issued and outstanding shares and votes in Norvestia, CapMan
will take measures to acquire the remaining shares in Norvestia through
redemption proceedings in accordance with Chapter 18 of the Companies Act.
Following this, CapMan will aim at Norvestia applying for delisting of its
shares from the Helsinki Stock Exchange at the earliest permitted and
practicable occasion under the applicable laws, regulations and Helsinki Stock
Exchange rules.
The Combination is not intended to have an immediate effect on the composition
of CapMan’s or Norvestia’s Board of Directors or senior management. CapMan and
Norvestia have, to some extent, overlapping functions, and necessary
arrangements related thereto will be considered in the Combined Group to
achieve the synergies of the Combination.
Estimate on the offer process and its duration
The Offer Period commences on or about 21 November 2016 and is initially
expected to end on 16 December 2016 (at 6:30 p.m), unless the Offer Period is
extended. CapMan may extend the Offer period at any time, under the limitations
that the Offer Period can be no more than 10 weeks, unless reasons as referred
to in the Securities Markets Act Chapter 11 Section 12 are present. The
combined exchange offer document and listing prospectus will be published on or
about 18 November 2016
Advisors
Summa Capital Ltd acts as CapMan’s financial advisor, and Summa Capital Markets
Ltd acts as the lead manager. Borenius Attorneys Ltd acts as CapMan’s legal
advisor. FIM Arvopaperipalvelut at S-Pankki Ltd acts as the technical organiser
of the Exchange Offer.
Press, analyst and investor conference today at 10 a.m.
CapMan will hold a press, analyst and investor conference today, on 3 November
2016, at 10:00 a.m. at CapMan’s head office in Helsinki, at Korkeavuorenkatu
32. CapMan’s CEO Heikki Westerlund, CapMan’s Chairman of the Board Karri Kaitue
and Norvestia’s Vice Chairman of the Board Hannu Syrjänen will present at the
conference. The presentation material is available at CapMan's website at the
beginning of the event. The conference will be held in Finnish. Welcome!
Appendix Conditions of the consummation of the Exchange Offer
(http://www.capman.com/investors/shares-and-shareholders/exchange-offer/)
Additional information:
Karri Kaitue, Chairman of the Board, CapMan Plc, tel. +358 40 501 5054
Heikki Westerlund, CEO, CapMan Plc, tel. +358 50 559 6580
CAPMAN PLC
BOARD OF DIRECTORS
Distribution:
Nasdaq Helsinki Ltd
Principal media
www.capman.com
CapMan
www.capman.com
CapMan is a leading Nordic investment and asset management company. For more
than 25 years, we have been developing companies and real estate and supporting
their sustainable growth. We are committed to understanding the needs of our
customers in an ever-changing market environment. Our objective is to provide
attractive returns and innovative solutions for our investors and value adding
services for professional investment partnerships, growth-oriented companies
and tenants. Our independent investment partnerships - Buyout, Real Estate,
Russia and Nest Capital - as well as our associated company Norvestia are
responsible for investment activities and value creation. CapMan's service
business offering includes fundraising advisory services, purchasing activities
and fund management services to both internal and external customers. CapMan
has 100 professionals and assets under management of €2.8 billion.
Important Notice
This release may not be released or otherwise distributed, in whole or in part,
in or into or to any person located or a resident of the United States of
America, Australia, Canada, Hong Kong, Japan, New Zealand or South Africa or
any other jurisdiction where prohibited by applicable laws or rules. This
release is not a share exchange offer document or a prospectus and as such does
not constitute an offer or invitation to make a sales offer. Investors shall
accept the exchange offer for the shares only on the basis of the information
provided in an exchange offer document and prospectus in respect of the
exchange offer. Offers will not be made directly or indirectly in any
jurisdiction where either an offer or participation therein is prohibited by
applicable law or where any exchange offer document or registration or other
requirements would apply in addition to those undertaken in Finland.
The exchange offer document and prospectus in respect of the exchange offer as
well as related acceptance forms will not and may not be distributed,
forwarded, or transmitted into, in, or from any jurisdiction where prohibited
by applicable law. In particular, the exchange offer is not being made,
directly or indirectly, in or into, Australia, Canada, Hong Kong, Japan, New
Zealand, South Africa, or the United States of America. The exchange offer
cannot be accepted from within Australia, Canada, Hong Kong, Japan, New
Zealand, South Africa, or the United States of America.
CapMan’s shares have not been and will not be registered under the U.S.
Securities Act of 1933, as amended (the “Securities Act”), or under any of the
relevant securities laws of any state or other jurisdiction of the United
States of America. CapMan's shares may not be offered or sold in the United
States, except pursuant to an exemption from the Securities Act or in a
transaction not subject to the registration requirements of the Securities Act.
Certain statements herein which are not historical facts, including, without
limitation, those regarding expectations for general economic development and
the market situation, expectations for the combined company’s development and
profitability and the realization of synergy benefits and cost savings, and
statements preceded by “expects”, ”estimates”, ”forecasts” or similar
expressions, are forward-looking statements. These statements are based on
current decisions and plans and currently known factors. They involve risks and
uncertainties which may cause the actual results to materially differ from the
results currently expected for the combined company. Such factors include, but
are not limited to, general economic conditions, including fluctuations in
exchange rates and interest levels which influence the operating environment
and profitability of customers and thereby the orders received by the combined
company and their margin; the competitive situation; the combined company’s own
operating conditions, such as the success of production and product development
and their continuous development and improvement; and the success of future
acquisitions.
Appendix
Conditions of the consummation of the Exchange Offer
The consummation of the Exchange Offer requires that the consummation
conditions presented below (the “Consummation Conditions”) are met or that
CapMan waives one or more of the Consummation Conditions to the extent allowed
under applicable laws and regulations.
-- the extraordinary general meeting convened by CapMan to be held on 8
December 2016 shall authorise CapMan's Board of Directors to issue the
Offer Shares;
-- the total number of Norvestia shares validly tendered in accordance with
the terms of the Exchange Offer on the date of publishing the final result
of the Exchange Offer together with Norvestia shares held by CapMan is more
than ninety (90) per cent of the total number of Norvestia shares issued
and outstanding, and votes attached to the shares, as calculated pursuant
to Chapter 18, Section 1 of the Finnish Companies Act concerning the right
and obligation to commence the mandatory redemption process;
-- after the announcement of the Exchange Offer, Norvestia has not resolved to
distribute any dividend or other assets to its shareholders, other than the
Extraordinary Dividend;
-- no such order has been issued or any such official action has been taken by
any court or public authority of competent jurisdiction that would prevent
or significantly delay the consummation of the Exchange Offer;
-- the members of Norvestia's Board of Directors who are independent of CapMan
have unanimously recommended accepting the Exchange Offer and the
recommendation remains in force and has not been rescinded, or modified in
this respect;
-- no Material Adverse Change (as defined below) has occurred after the
announcement of the Exchange Offer; and
-- no information made public by Norvestia or disclosed to CapMan by Norvestia
is materially inaccurate, incomplete or misleading, and Norvestia has not
failed to make public any information that should have been made public by
it under applicable laws and regulations, nor has CapMan received any new
information after the announcement of the Exchange Offer previously
undisclosed to CapMan or its representatives that, when realised has
resulted in or constituted, or that can reasonably be expected to result in
or constitute a Material Adverse Change.
A ”Material Adverse Change” means (i) any divestment of any material part or
asset of Norvestia or its subsidiaries or any material reorganisation thereof
which is not in the ordinary course of the investment business of the companies
or in relation to payment of the Extraordinary Dividend; or (ii) bankruptcy,
administration, insolvency or similar proceedings of Norvestia; or (iii) a
negative change of at least 10 per cent in the net asset value of Norvestia
published on 27 October 2016.
For the sake of clarity, no Material Adverse Change shall be considered to
having occurred to the extent such alleged Material Adverse Change has resulted
from such other matter that Norvestia has published through a stock exchange
release or as part of its obligation to disclose periodic information or that
has otherwise been reasonably disclosed to CapMan prior to the announcement of
the Exchange Offer.
CapMan shall only be able to refer to any Consummation Condition in order to
cause the progress, interruption or withdrawal of the Exchange Offer in
situations where, from the viewpoint of the Exchange Offer, such Consummation
Condition is of such material importance to CapMan as is referred to in the
Financial Supervisory Authority Regulations and guidelines 9/2013 (Takeover bid
and obligation to launch a bid, and in the Helsinki Takeover Code). Considering
the aforesaid, CapMan shall retain the right to withdraw the Exchange Offer if
any of the Consummation Conditions have not been fulfilled or will not be
fulfilled.
CapMan may, within the limits of the laws, waive such Consummation Condition
which has not been fulfilled. If all the Consummation Conditions have been
fulfilled at the closing or interruption of the Offer Period or Extended Offer
Period or CapMan has waived any Consummation Condition that has not been
fulfilled, CapMan shall consummate the Exchange Offer in accordance with its
terms at the closing of the Offer Period by acquiring Norvestia shares and
Subscription Rights by paying the Offer Consideration to such shareholders of
Norvestia and holders of Subscription Rights who have duly approved the
Exchange Offer and have not duly withdrawn their approval.
CapMan shall announce by a stock exchange release that the Consummation
Conditions are fulfilled or that the Company shall waive conditions that have
not been fulfilled.
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