SRV Yhtiöt Oyj - Company Announcement

SRV’s Board of Directors decide on the terms and conditions of the EUR 50 million rights offering

Espoo, Finlanf, 2015-08-18 14:45 CEST (GLOBE NEWSWIRE) -- SRV GROUP PLC STOCK
EXCHANGE RELEASE 18 AUGUST 2015, at 15:45 Finnish time 

SRV's Board of Directors decide on the terms and conditions of the EUR 50
million rights offering 

Not for publication, distribution or release, directly or indirectly, in or
into the United States, Australia, Canada, Hong Kong, Japan, New Zealand, South
Africa or Singapore 

The Rights Offering in Brief

● Gross proceeds of approximately EUR 50 million to finance existing and
potential future growth projects and to strengthen the balance sheet structure 

● Two (2) new shares for three (3) existing share held on the record date of 20
August 2015 

● Subscription price of EUR 2.11 per new share

● SRV shares will trade ex-rights from 19 August 2015

● Subscription period begins on 25 August 2015 and ends on 8 September 2015 at
20:00 Finnish time 

● Trading in subscription rights begins on 25 August 2015 at 10:00 Finnish time
and ends on 2 September 2015 at 18:30 Finnish time 

General

Based on the authorization granted by the extraordinary general meeting of
shareholders on 22 June 2015, the Board of Directors of SRV Group Plc (“SRV”)
has resolved on the rights offering of EUR 50 million. The proceeds from the
rights offering will be used to finance existing and potential future growth
projects and to strengthen the balance sheet structure. The reason for the
Offering is SRV's increased construction volumes and in particular the large
projects that require equity and financing, such as Kalasatama REDI and several
other growth projects in Finland and Russia that are significant for the
future. 

A total of 23,731,107 new shares (the “Offer Shares”) will be offered for
subscription with pre-emptive rights for existing shareholders (the
“Offering”). SRV's shareholders who are registered in the SRV's shareholder
register maintained by Euroclear Finland Ltd on the record date of the Offering
on 20 August 2015 (the “Record Date”), will receive one (1) freely transferable
subscription right (the “Subscription Right”) in the form of a book-entry for
each existing share of SRV held on the Record Date. Three (3) Subscription
Rights will entitle its holder to subscribe for two (2) Offer Shares at a
subscription price of EUR 2.11 per Offer Share (the “Subscription Price”). The
Subscription Price corresponds to an implied discount to the theoretical
ex-rights price of approximately 29.8 percent, based on SRV's closing share
price of EUR 3.60 on 17 August 2015. 

Shares will trade ex-rights from 19 August 2015. The subscription period
commences on 25 August 2015 and expires on 8 September 2015 at 20:00 Finnish
time. Public trading of the Subscription Rights on the Helsinki Stock Exchange
commences on 25 August 2015 at 10:00 Finnish time and expires on 2 September
2015 at 18:30 Finnish time. 

The Offer Shares will represent approximately 39.2 percent of all shares of SRV
and votes attached to such shares after the completion of the Offering assuming
that the Offering is subscribed for in full. 

Existing shareholders of SRV and other investors who have subscribed for Offer
Shares with Subscription Rights may subscribe for Offer Shares also without
Subscription Rights (the “Secondary Subscription”). Offer Shares will be
allocated to subscribers in the Secondary Subscription in the event that not
all the Offer Shares have been subscribed for pursuant to the exercise of
Subscription Rights. The allocation of Offer Shares in the Secondary
Subscription will be primarily determined per book-entry account in proportion
to the number of Subscription Rights exercised for subscription of Offer
Shares. 

SRV expects to publish the preliminary results of the Offering in a stock
exchange release on or about 10 September 2015 and the final results of the
Offering on or about 14 September 2015. 

The terms and conditions of the Offering are attached to this stock exchange
release. 

Nordea Bank Finland Plc (“Nordea”) and Pohjola Bank Plc (“Pohjola”) act as the
managers for the Offering. 

Use of Proceeds

The gross proceeds received by SRV from the Offering will be approximately EUR
50 million. 

The proceeds from the Offering will be used to finance existing and potential
future growth projects and to strengthen the balance sheet structure. The
reason for the Offering is SRV's increased construction volumes and in
particular the large projects that require equity and financing, such as
Kalasatama REDI and several other growth projects in Finland and Russia that
are significant for the future. The proceeds from the Offering will be used to
strengthen the balance sheet structure as well as to secure the additional debt
financing required for the financing of different construction projects. After
the completion of the Offering, SRV plans to obtain the required additional
debt financing through a domestic or foreign bond transaction. In addition, SRV
may obtain debt financing through equivalent financing measures. 

Subscription Commitments

Ilpo Kokkila, Kolpi Investments Oy ja Timo Kokkila (together, the “Subscription
Guarantors”), whose holdings in SRV represent an aggregate of 51.8 percent of
SRV's existing shares, have, subject to certain conditions, each separately and
irrevocably undertaken to subscribe and pay for, at the Subscription Price,
such number of Offer Shares that corresponds to the respective Subscription
Guarantor's pro rata allocation in the Offering on the basis of the
Subscription Rights to be allocated to it (either personally and/or through a
controlled entity). The subscription commitments include in total of 12,709,585
Offer Shares, or 53.6 percent of the Offer Shares in total. 

Publication of the Offering Circular

In relation to the Offering, SRV has submitted a Finnish language offering
circular for the approval of the Finnish Financial Supervisory Authority, and
such offering circular is expected to be published on 20 August 2015. The
Finnish language offering circular is expected to be available on SRV's website
www.srv.fi/sijoittajat on or about 21 August 2015 and expected to be available
at the branch offices of Nordea and OP Financial Group's offices and at
Helsinki Stock Exchange on 24 August 2015. 

Further information:
Juha Pekka Ojala, President and CEO, tel: +358 (0)40 733 4173
Ilkka Pitkänen, CFO, tel. +358 (0)40 667 0906
Päivi Kauhanen, Vice President, Communications, tel. +358 (0)50 598 9560

www.srv.fi

DISCLAIMER

This announcement is not being made in and copies of it may not be distributed
or sent into the United States, Australia, Canada, Hong Kong, Japan, New
Zealand, South Africa or Singapore. This announcement does not constitute an
offer to sell, or a solicitation of an offer to purchase, any securities in the
United States. The securities referred to herein may not be sold in the United
States absent registration or an exemption from registration under the U.S.
Securities Act of 1933, as amended. SRV Group Plc does not intend to register
any of the securities in the United States or to conduct a public offering of
the securities in the United States. 

This communication does not constitute an offer of the securities to the public
in the United Kingdom. No prospectus has been or will be approved in the United
Kingdom in respect of the securities. This communication is being distributed
to and is directed only at (i) persons who are outside the United Kingdom or
(ii) persons who are investment professionals within the meaning of Article
19(5) of the Financial Services and Markets Act 2000 (Financial Promotion)
Order 2005 (the “Order”) and (iii) high net worth entities, and other persons
to whom it 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”). Any investment activity to which this communication relates will
only be available to and will only be engaged with, Relevant Persons. Any
person who is not a Relevant Person should not act or rely on this document or
any of its contents. 

TERMS AND CONDITIONS OF THE OFFERING

Background

On 22 June 2015, the Extraordinary General Meeting of SRV Group Plc (the
“Company”) authorised the Company's Board of Directors to decide on the
issuance of a maximum of 27,000,000 new shares. 

On 18 August 2015, the Board of Directors of the Company resolved, based on the
above authorisation granted by the Extraordinary General Meeting, to issue a
maximum of 23,731,107 new shares through a share issue based on the pre-emptive
subscription right of shareholders of the Company (the “Offering”) as set forth
in the below terms and conditions of the Offering. 

The new shares to be issued in the Offering (the “Offer Shares”) represent
approximately 64.5 percent of the total 36,768,468 shares and votes attached to
such shares in the Company before the Offering and approximately 39.2 percent
of the total 60,499,575 shares and votes attached to such shares in the Company
after the Offering assuming that the Offering is subscribed for in full. 

Nordea Bank Finland Plc (“Nordea”) and Pohjola Bank plc (“Pohjola Bank”) are
acting as global coordinators and bookrunners in the Offering (together, the
“Managers”). 

Terms and Conditions of the Offering

Right to Subscribe

Primary Subscription Right

The Offer Shares to be issued (the “Offer Shares”) will be offered for
subscription by the shareholders of the Company in proportion to their
shareholdings of the existing shares. 

A shareholder who is registered in the Company's shareholder register
maintained by Euroclear Finland Ltd on the record date of 20 August 2015 of the
Offering (“Record Date”) will automatically receive one (1) freely transferable
subscription right (the “Subscription Right”) as a book-entry (ISIN Code
FI4000167291) for every share owned on the Record Date (the “Primary
Subscription Right”). 

A shareholder, or a person or an entity to whom Subscription Rights have been
transferred, is entitled to subscribe for two (2) Offer Shares for every three
(3) Subscription Rights. Fractions of Offer Shares will not be allotted, i.e.,
exactly three (3) Subscription Rights are needed for subscribing for every two
(2) Offer Shares. Shares held by the Company do not entitle to Subscription
Rights. 

Secondary Subscription

Further, a shareholder (or other investor) who has subscribed for Offer Shares
based on the Primary Subscription Right, is entitled to subscribe for Offer
Shares not subscribed for by virtue of the Primary Subscription Right (the
“Secondary Subscription”). 

Subscription Commitments

The largest shareholders of the Company Ilpo Kokkila, Kolpi Investments Oy and
Timo Kokkila have each individually and irrevocably committed to subscribe for
Offer Shares to be issued in the Offering fully in proportion to their current
shareholdings in the Company. Ilpo Kokkila, Kolpi Investments Oy and Timo
Kokkila will subscribe for a total of 12,709,585 Offer Shares in the Offering
pursuant to their respective subscription commitments as follows: Ilpo Kokkila
(either personally and/or through a controlled entity) 6,023,141 Offer Shares,
Kolpi Investments Oy 3,671,586 Offer Shares and Timo Kokkila 3,014,858 Offer
Shares. In total, these subscription commitments represent approximately 53.6
percent of the maximum number of Offer Shares to be issued in the Offering. 

Subscription Price

The subscription price is EUR 2.11 per Offer Share (the “Subscription Price”).
The Subscription Price will be recorded in its entirety in the invested free
equity fund. 

The Subscription Price includes a discount customary in rights issues compared
to the closing price of the share on NASDAQ OMX Helsinki Ltd (“Helsinki Stock
Exchange”) on the trading day immediately preceding the decision on the
Offering. 

Subscription Period

The subscription period will commence on 25 August 2015 and expire on 8
September 2015 at 8 p.m. Finnish time (the “Subscription Period”). The places
of subscription will accept subscription assignments during their normal
business hours. 

Account operators may impose a deadline for subscription that is earlier than
the expiry of the Subscription Period. 

Subscription for Offer Shares pursuant to the Primary Subscription Right and
Payments 

A holder of Subscription Rights may participate in the Offering by subscribing
for Offer Shares pursuant to the Subscription Rights registered on his or her
book-entry account and by paying the Subscription Price. Each three (3)
Subscription Rights entitle their holder to subscribe for two (2) Offer Shares.
Fractional Offer Shares cannot be subscribed for. In order to participate in
the Offering, a holder of Subscription Rights must submit a subscription
assignment in accordance with the instructions given by Nordea or the relevant
custodian or account operator. A holder of Subscription Rights, who does not
receive instructions for subscription from his or her account operator, can
contact Nordea. 

If a share entitling to a Subscription Right is pledged or subject to any other
restrictions, the Subscription Right may not necessarily be exercised without
the written consent of the pledgee or holder of any other relevant right. 

Subscription orders can be submitted in the following subscription places:

● at the branch offices of Nordea Bank Finland Plc and Nordea Private Banking
units during their normal business hours; 

● via Nordea Customer Service by telephone with bank identifier codes from
Monday to Friday from 8:00 a.m. to 8:00 p.m. Finnish time at +358 200 3000 (in
Finnish, local network charge/mobile phone charge apply), at +358 200 5000 (in
Swedish,  local network charge/mobile phone charge apply), or from Monday to
Friday from 10:00 a.m. to 4:30 p.m. Finnish time at +358 200 70000 (in English,
local network charge/mobile phone charge apply). Customers subscribing through
the call service need a personal network service agreement with Nordea Bank
Finland Plc. When subscribing through the call service, the identification of
the shareholder will be confirmed by network identification codes. Corporations
cannot give subscription assignments by telephone through Nordea Customer
Service. The Nordea Customer Service calls are recorded. Subscriptions cannot
be effected through the Nordea net bank service; and 

● with account operators and custodians who have an authorized representative
agreement with Nordea Bank Finland Plc regarding receipt of subscriptions. 

The Subscription Price of the Offer Shares subscribed for in the Offering shall
be paid in full at the time of submitting the subscription assignment in
accordance with the instructions given by the subscription place or the
relevant custodian or account operator. 

Shareholders and other investors participating in the Offering whose shares or
Subscription Rights are held through a nominee must submit their subscription
assignments in accordance with the instructions given by their custodial
nominee account holder. 

Incomplete or erroneous subscription assignments may be rejected. A
subscription assignment may be rejected if the subscription payment is not made
according to these terms and conditions or if such payment is not made in full.
In these situations, the subscription payment will be refunded to the
subscriber. No interest will be paid on the refunded amount. 

Any exercise of the Primary Subscription Right is irrevocable and may not be
modified or cancelled otherwise than as stated in section “Cancellation of
Subscriptions under Certain Circumstances” in these terms and conditions. 

Unexercised Subscription Rights will expire without any compensation at the
expiry of the Subscription Period on 8 September 2015. 

Subscription of Offer Shares pursuant to the Secondary Subscription and Payments

A shareholder (or other investor) who has subscribed for Offer Shares based on
the Primary Subscription Right (the “Subscriber”) is entitled to subscribe for
Offer Shares in the Secondary Subscription. 

The subscription of the Offer Shares pursuant to the Secondary Subscription
will take place by submitting a subscription assignment and at the same time
paying the Subscription Price in accordance with the instructions given by the
subscription place, the relevant custodian or account operator or, in the case
of nominee registered investors, by the nominee. 

Incomplete or erroneous subscription assignments may be rejected. A
subscription assignment may be rejected if the subscription payment is not made
according to these terms and conditions or if such payment is not made in full.
In these situations, the subscription payment will be refunded to the
Subscriber. No interest will be paid on the refunded amount. 

Any subscriptions made in the Secondary Subscription are irrevocable and may
not be modified or cancelled otherwise than as stated in section “Cancellation
of Subscriptions under Certain Circumstances” in these terms and conditions. 

On or about 16 September 2015, account operators will confirm the acceptance or
rejection of the subscriptions of Offer Shares made in a Secondary Subscription
to the Subscribers. 

Cancellation of Subscriptions under Certain Circumstances

If the offering circular for the Offering (the “Offering Circular”) is
supplemented or corrected due to a mistake or inaccuracy or material new
information which could be of material relevance to the investors, any
Subscribers who have already subscribed for Offer Shares before the related
supplement is published, shall have the right to withdraw their subscription in
accordance with the Finnish Securities Market Act (746/2012, as amended). The
Subscribers have a right to withdraw their subscription within two (2) banking
days after the supplement has been published. The cancellation right requires
that the mistake, inaccuracy or material new information has emerged before the
trading in the interim shares representing the Offer Shares has begun or, in
case of Secondary Subscription, before the Offer Shares have been delivered to
the Subscribers. The withdrawal of a subscription applies to the subscription
to be withdrawn as a whole. The right to withdraw and the procedure for such
withdrawal right will be announced together with any such possible supplement
to the Offering Circular through a stock exchange release. If the holder of a
Subscription Right has sold or otherwise transferred the Subscription Right,
such sale or transfer cannot be cancelled. 

Public Trading of the Subscription Rights

The holders of Subscription Rights may sell their Subscription Rights any time
before the public trading in Subscription Rights ends. The Subscription Rights
are subject to public trading on the Helsinki Stock Exchange between 25 August
2015 at 10:00 a.m. Finnish time and 2 September 2015 at 6:30 p.m. Finnish time.
Subscription Rights may be sold or purchased by giving a sell or purchase
assignment to one's own book-entry account operator or to any securities
broker. 

Approval of the Subscriptions

The Board of Directors of the Company will approve all subscriptions pursuant
to the Primary Subscription Right made in accordance with these terms and
conditions of the Offering and applicable laws and regulations. 

If all Offer Shares to be issued in the Offering have not been subscribed for
by virtue of the Primary Subscription Right, the Board of Directors of the
Company will resolve to allocate such unsubscribed Offer Shares among the
Subscribers having made a Secondary Subscription. In case of over-subscription
by virtue of Secondary Subscription, the allocation among Subscribers will be
determined per book-entry account in proportion to the number of Subscription
Rights exercised by Subscribers in accordance with the Primary Subscription
Right and, where this is not possible, by drawing of lots. If several
subscription assignments are given concerning such a book-entry account, these
subscription assignments are combined as one subscription assignment concerning
such a book-entry account. Should the Subscriber not receive all Offer Shares
subscribed for by virtue of the Secondary Subscription, the subscription price
for the Offer Shares not received by the Subscriber will be repaid to the
Subscriber at the latest on or about 17 September 2015. No interest will be
paid for the repayable funds. 

If all Offer Shares have not been subscribed for after the Secondary
Subscription, the Board of Directors of the Company may decide on the offering
of the unsubscribed Offer Shares to parties decided by it. The subscription
period for these parties will expire on 14 September 2015.The Company's Board
of Directors will decide on the approval of the subscriptions on or about 14
September 2015. The Company will publish the final results of the Offering in a
stock exchange release on or about 14 September 2015. 

Registration of the Offer Shares to the Book-entry Accounts and Trading in the
Offer Shares 

The Offer Shares subscribed for in the Offering by virtue of the Primary
Subscription Right will be recorded on the Subscriber's book-entry account
after the registration of the subscription as interim shares (ISIN Code
FI4000167309) corresponding to the Offer Shares. The interim shares will become
subject to public trading on or about 9 September 2015. The interim shares are
combined with the existing shares of the Company (ISIN Code FI0009015309) on or
about 14 September 2015. The Offer Shares subscribed for and approved by virtue
of the Secondary Subscription will be recorded on the Subscribers' book-entry
accounts after the registration of Offer Shares in the Trade Register, on or
about 15 September 2015. 

Trading in the Offer Shares commences on the official list of the Helsinki
Stock Exchange on or about 15 September 2015. 

Shareholder Rights

The Offer Shares will entitle their holders to full dividend and other
distribution of funds declared by the Company, if any, and to other shareholder
rights in the Company after the Offer Shares have been registered in the Trade
Register and in the Company's shareholder register, on or about 15 September
2015. 

Fees and Expenses

No transfer tax or service charges are payable for the subscription of the
Offer Shares. Custodians, account operators and brokers may charge a commission
for trading in the Subscription Rights in accordance with their own price
lists. Each custodian and account operator will charge fees in accordance with
its own price list for maintaining the book-entry account and for the custody
of the shares. 

Information

Documents mentioned in Chapter 5, Section 21 of the Finnish Companies Act are
available for review as of the commencement of the Subscription Period at the
Company's website at www.srv.fi/sijoittajat. 

Applicable Law and Dispute Resolution

The Offering and the Offer Shares shall be governed by the laws of Finland. Any
disputes arising in connection with the Offering shall be settled by the court
of jurisdiction in Finland. 

In case of any discrepancies between the original Finnish language version and
the English language translation of these terms and conditions, the Finnish
language version shall prevail. 

Other Issues

Other issues and practical matters relating to Offering will be resolved by the
Board of Directors of the Company.