Neomarkka - Company Announcement

NEO INDUSTRIAL HAS APPROVED SUBSCRIPTIONS OF CONVERTIBLE BONDS

NEO INDUSTRIAL OYJ       STOCK EXCHANGE  RELEASE    23 November, 2011 at 7.00 pm


Neo Industrial has approved subscriptions of convertible bonds

Neo Industrial Plc ("Neo Industrial" or the "Company") has today approved the
subscriptions of senior unsecured convertible bonds due 2016 (the "Bonds") in
an aggregate principal amount of EUR 6 million. The subscriptions are based on
an offer of the Bonds to certain institutional investors that was announced
earlier today. 

The Bonds are intended to diversify the Company's funding base, extend the debt
maturity profile and improve the liquidity position. 

The Bonds carry a coupon of 7.50% per annum payable annually in arrear starting
on 30 November 2012. The Bonds do not entitle to shares but to cash
compensation based the Company's class B share price unless previously redeemed
or bought back. The ground for the cash compensation (conversion price) is a
premium of 25% to the five-day (17 November through 23 November)
volume-weighted average price of Neo Industrial's class B shares on the NASDAQ
OMX Helsinki. The conversion price is EUR 2.78. The Bonds will be issued at
100% of their principal amount and the Bondholders are entitled to cash
compensation equal to the market value of the shares notionally underlying the
Bonds as detailed in the terms and conditions. The right to convert the Bonds,
i.e. the right to cash compensation, commences on 2 December 2013. The
settlement date of the Bonds is 30 November 2011. 

The Company will have the right to redeem the Bonds at their principal amount
together with interest accrued to such date after 1 December 2014 provided that
the closing price of Neo Industrial's class B share has for a specified period
been at least 150 per cent of the conversion price as well as at any time if
less than 15 per cent of the principal amount of the Bonds originally issued
remains outstanding. The investors have the right to require the Company to
redeem the Bonds on 30 January 2015 at their principal amount together with
accrued interest. 

No application will be made to admit the Bonds to public trading.

 “We are delighted by the successful completion of our EUR 6 million
convertible bond offering today, which will strengthen our financial position,
improve liquidity and increase our flexibility in developing our businesses”,
commented Markku E. Rentto, Managing Director of Neo Industrial. 

Pohjola Corporate Finance Ltd is acting as the Lead Manager for the Issue.



Neo Industrial Plc

Markku E. Rentto
Managing Director

Further information:
Markku E. Rentto, Managing Director, Neo Industrial Plc, tel. +358 207 209 191
Timo Mäkeläinen, Managing Director, Pohjola Corporate Finance Ltd, tel. +358 50
307 8977 



www.neoindustrial.fi

Neo Industrial's strategy is to invest mainly in industrial companies with
similar synergic benefits. The aim of investments is with active ownership to
develop the purchased companies and establish additional value. Returns are
sought through both dividend flow and an increase in value. Neo Industrial's
class B shares are listed on the NASDAQ OMX Helsinki Stock Exchange. 

Neo Industrial's business segments are Cable (Reka Cables, Expokabel, Nestor
Cables), Viscose Fibers (Avilon) and Single Family Housing (Finndomo).