HKScan Oyj - Company Announcement

BOARD OF DIRECTORS OF HKSCAN CORPORATION HAS DECIDED ON A SHARE OFFERING

HKScan Corporation      STOCK EXCHANGE BULLETIN      Nov 24, 2009  


NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN
PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, HONG KONG, JAPAN OR
SOUTH AFRICA. 


BOARD OF DIRECTORS OF HKSCAN CORPORATION HAS DECIDED ON A SHARE OFFERING

Based on the authorisation granted by HKScan Corporation (the “Company” or
“HKScan”) Extraordinary General Meeting of 24 November 2009, the Board of
Directors of HKScan has today, 24 November 2009, decided on a share offering
(the "Offering"). 

The Board of Directors of HKScan has resolved to issue a maximum of 14,739,822
new A-shares (the "Offer Shares") in the Offering in such a manner that the
shareholders of HK Scan will have a pre-emptive right to subscribe for new
A-shares in proportion to their current shareholding of A-shares and/or
K-shares in the Company. 

The subscription price for the Offer Shares will be EUR 5.30 per Offer Share.
The subscription period will begin on 2 December 2009 and end at 5:00 p.m.
(Finnish time) on 17 December 2009. 

A holder of the existing shares of HKScan, who is registered in HKScan's
shareholders' register maintained by Euroclear Finland on the record date of 27
November 2009 shall automatically receive one (1) freely transferable right in
the form of a book-entry entitling to subscribe for Offer Shares for each
existing A-share and/or K-share of HKScan owned on the record date. Eight (8)
rights will entitle the holder of the rights to subscribe for three (3) Offer
Shares. No fractions of Offer Shares will be allotted. Trading in rights on
NASDAQ OMX Helsinki Ltd commences on 2 December 2009 and ends on 10 December
2009. The rights are freely transferable. 

HKScan will announce the final results of the Offering in a stock exchange
release on or about 22 December 2009. The full terms and conditions of the
Offering are set out in the appendix to this release. 

Assuming that all of the Offer Shares are subscribed for in the Offering, the
gross proceeds received by HKScan from the Offering will be approximately EUR
78.1 million. HKScan is undertaking the Offering to strengthen its capital
structure and to increase operational and strategic flexibility. The Company
also plans to repay its EUR 20 million hybrid bond. 
The largest shareholders of HKScan, LSO Osuuskunta and Swedish Meats Ekonomisk
Förening, the owners of 35.51 % and 12.77 % of HKScan shares respectively, have
committed to subscribe for their pro rata entitlement of the Offer Shares. 

Danske Markets is acting as lead manager in the Offering, and has entered into
an underwriting agreement with HKScan, pursuant to which it will, subject to
certain conditions, procure subscribers or subscribe for any Offer Shares that
may remain unsubscribed for in the Offering, excluding the Offer Shares that
LSO Osuuskunta and Swedish Meats Ekonomisk Förening have committed to subscribe
for. 


HKScan Corporation
Board of Directors


Further information: Matti Perkonoja, CEO of HKScan Corporation. Please leave
any messages for him to call with Marjukka Hujanen on +358 (0)10 570 6218. 


DISCLAIMER:

This announcement does not constitute or form part of an offer or solicitation
to purchase or subscribe for 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. HKScan Corporation does not intend to register any portion of the
offering of the securities in the United States or to conduct a public offering
of the securities in the United States. Copies of this announcement are not
being made and may not be distributed or sent into the United States, Canada,
Australia, Hong Kong, Japan or South Africa. 

The information contained herein shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of the securities
referred to herein in any jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration, exemption from registration or
qualification under the securities laws of any such jurisdiction. 

This communication does not constitute an offer of securities to the public in
the United Kingdom. This communication is directed only at (i) persons who are
outside the United Kingdom or (ii) investment professionals falling within
Article 19(5) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 (the “Order”) and (iii) persons falling within Article
49(2) (a) to (d) (“high net worth companies, unincorporated associations etc.”)
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 be engaged only with, relevant persons. Any
person who is not a relevant person should not act or rely on this document or
any of its contents. 


HKScan is one of the leading food companies in northern Europe with home
markets in Finland, Sweden, the Baltics and Poland. HKScan manufactures, sells
and markets pork and beef, poultry products, processed meats and convenience
foods under several well-known local brand names. Its customers are retail, the
HoReCa sector, industry and export customers. HKScan is active in nine
countries and has some 10,000 employees. Annual net sales are 2.3 billion euro. 



DISTRIBUTION:
Nasdaq OMX, Helsinki
Main media
www.hkscan.com



APPENDIX: 

TERMS AND CONDITIONS OF THE OFFERING

On 24 November 2009, HKScan Corporation's (“HKScan” or the “Company”)
Extraordinary General Meeting of Shareholders authorised the Company's Board of
Directors to decide on a directed share issue in which the shareholders will
have a pre-emptive right to subscribe for new A shares in proportion to their
current shareholding of A and/or K shares in the Company. The number of new A
shares to be issued based on the authorisation may not exceed 20,000,000
shares. The Company's Board of Directors was authorised to decide upon other
terms and conditions of the issue. The authorisation includes the right to
decide on the issue of the unsubscribed shares, if any, to investors and/or to
lead manager of the share issue. 

On 24 November 2009, the Board of Directors of the Company resolved, based on
the authorisation granted by the Extraordinary General Meeting of Shareholders
of the Company, to issue a maximum of 14,739,822 new A shares (the “Offer
Shares”) as set forth in these terms and conditions of the offering (the
“Offering”). 

As a result of the Offering, the total number of shares in the Company may
increase from a total of 39,306,193 shares to a maximum of 54,046,015 shares
and the number of A shares may increase from 33,906,193 shares to 48,646,015
shares. Assuming that the Offering is fully subscribed for, the Offer Shares
represent approximately 37,5 per cent of the total number of shares in the
Company and approximately 10,4 per cent of the total voting rights in the
Company outstanding prior the Offering, and approximately 27,3 per cent of the
total number of shares in the Company and approximately 9,4 per cent of the
total voting rights in the Company outstanding after the Offering. 

Primary Subscription Right

The Offer Shares will be offered for subscription to the shareholders of the
Company in proportion to their holding of existing A and/or K shares in the
Company. Because shares of only one class are offered in the Offering, the
Offering is formally a directed share issue. There is a weighty financial
reason to deviate from the pre-emptive subscription rights of shareholders and
the Offering is in the interest of the Company and all of its shareholders
because the execution of a share issue, while formally a directed share issue
but in practice a rights issue, is easier with the publicly traded A shares the
market value of which is based on public trading. 

The ex-rights date for the subscription rights is 25 November 2009 as of which
the A shares will be quoted without the subscription rights. 

The record date of the Offering is 27 November 2009 (the “Record Date”).

Each holder of the existing shares in the Company that is registered in the
Company's shareholders' register maintained by Euroclear Finland Ltd.
(“Euroclear Finland”) on the Record Date, shall automatically receive one (1)
freely transferable subscription right in the form of a book-entry entitling to
subscribe for the Offer Shares, for each existing A or K share in the Company
owned on the Record Date (the “Subscription Right”). Every eight (8)
Subscription Rights will entitle their holder to subscribe for three (3) Offer
Shares (the “Primary Subscription Right”). No fractions of the Offer Shares
will be allotted. 

The Subscription Rights will be subject to public trading on the NASDAQ OMX
Helsinki Ltd. (the “Helsinki Stock Exchange”) from 2 December to 10 December
2009. 

Secondary Subscription

In addition to the Primary Subscription Right, a shareholder of the Company who
is registered in the Company's shareholders' register on the Record Date and
who has subscribed for the Offer Shares on the basis of the Primary
Subscription Right is entitled to subscribe for the Offer Shares not subscribed
for by virtue of the Primary Subscription Right (the “Secondary Subscription”).
A shareholder, who is willing to subscribe for the Offer Shares in the
Secondary Subscription, shall in connection with using the Primary Subscription
Right notify the maximum amount of the Offer Shares to be subscribed for in the
Secondary Subscription. 

Unsubscribed Shares

The Board of Directors of the Company shall decide to direct the Offer Shares
which have not been subscribed for pursuant to the Primary Subscription Right
and in the Secondary Subscription, as determined by the Board of Directors, to
subscribers procured by Danske Bank A/S, Helsinki Branch (the “Lead Manager”)
or, failing which, to the Lead Manager. 

Participation of the Major Shareholders in the Offering and Underwriting

The largest shareholder of the Company LSO Osuuskunta that owns 35.51 per cent
of all the shares in the Company and 73.23 per cent of all the voting rights
prior to the Offering, has undertaken to subscribe for its pro rata share of
the Offer Shares in the Offering. The second largest shareholder of the Company
Swedish Meats ekonomisk förening (“Swedish Meats”) that owns 12.77 per cent of
all the shares in the Company and 12.44 per cent of all the voting rights prior
to the Offering has also undertaken to subscribe for its pro rata share of the
Offer Shares in the Offering. 

The Lead Manager has entered into an agreement with the Company pursuant to
which the Lead Manager has severally agreed, subject to certain conditions, to
procure subscribers for the Offer Shares that may remain unsubscribed for
pursuant to the Primary Subscription Right or in the Secondary Subscription,
excluding the Offer Shares that LSO Osuuskunta and Swedish Meats have
undertaken to subscribe for, or, to subscribe for such Offer Shares. 

See section “Arrangements with the Lead Manager” in the Company's offering note
dated 24 November 2009. 

Subscription Price

The subscription price is EUR 5.30 per Offer Share (the “Subscription Price”).

The Subscription Price shall be entered into the invested unrestricted equity
reserve of the Company. Although the Offering is formally a directed share
issue, the Subscription Price has been set such that it includes a discount
typical for rights issues, the amount of which in this Offering is
approximately 42.4 per cent compared to the closing price of existing A shares
in the Company on the Helsinki Stock Exchange on the trading day preceding the
day of the Company's Board of Directors' decision on the Offering. 

Subscription Period

The subscription period will commence on 2 December 2009 and end on 17 December
2009 at 5:00 p.m. Finnish time (the “Subscription Period”). The subscription
places will accept subscription assignments during their normal business hours. 

The subscription period with respect to subscribers procured by the Lead
Manager ends on 23 December 2009. However, the Company's Board of Directors may
decide to interrupt the subscription period with respect to subscribers
procured by the Lead Manager before the said date. 

Places of Subscription

Subscription assignments may be submitted at Sampo Bank plc's (“Sampo Bank”)
offices, the offices of Sampo Bank Private Banking and through Sampo Bank's
Customer Service (telephone + 358 (0)10 546 3159, from Monday to Friday between
9 a.m. and 6 p.m.). Sampo Bank's book-entry account customer may also make a
subscription assignment as regards the Primary Subscription Right through Sampo
Bank's electronic banking service. A subscription assignment submitted through
Sampo Bank's Customer Service and electronic banking requires that the
subscriber has a valid contract regarding bank identifiers with Sampo Bank. 

In addition, subscription assignments may be submitted to the account operators
and custodians who have entered into an agreement with Sampo Bank on reception
of subscriptions. Places of subscription and account operators may request
submission of a subscription assignment already at a certain date before the
public trading on the Subscription Rights ends. 

Subscription

A shareholder may participate in the Offering by subscribing for the Offer
Shares by using the Subscription Rights on the shareholder's book-entry account
and by paying the Subscription Price. In order to participate in the Offering,
a shareholder must submit a subscription assignment in accordance with the
instructions provided by the shareholder's own book-entry account operator. If
the shareholder's own account operator does not provide instructions in
relation to the subscription, the shareholder should contact Sampo Bank. 

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

All subscriptions of Offer Shares made in the Offering are irrevocable and may
not be modified or cancelled other than as set forth below under “Cancellation
of Subscriptions under Certain Circumstances”. 

Any unexercised Subscription Rights will expire at the end of the Subscription
Period on 17 December 2009, at the latest. 

Cancellation of Subscriptions under Certain Circumstances

If the Company's registration document and/or offering note dated 24 November
2009 (together the “Prospectus”) is supplemented due to an error or omission in
accordance with the Finnish Securities Market Act, investors who have made a
subscription prior to the publication of the supplement to the Prospectus are
entitled to withdraw their subscription according to the Finnish Securities
Market Act within two (2) business days from the publication of the supplement
to the Prospectus, or, if so decided by the Finnish Financial Supervisory
Authority for special reasons, within a longer period not exceeding four (4)
business days from the publication of the supplement to the Prospectus. The
withdrawal right may only be used if the investor has subscribed for the Offer
Shares prior to the publication of the supplement to the Prospectus and such
supplement is published between the commencement of the Subscription Period and
the time when the trading with the interim shares corresponding to the Offer
Shares subscribed for pursuant to Subscription Rights commences on the Helsinki
Stock Exchange. A withdrawal of a subscription will result in the subscription
being withdrawn in its entirety. Investors will be notified of their right of
withdrawal as well as instructions on how to withdraw in the Company's stock
exchange release in connection with the publication of the supplement. If a
subscription is withdrawn, the institution to which subscription instructions
were submitted will refund the Subscription Price paid into a bank account
elected by the investor without interest. Subsequently, if the subscription has
been made pursuant to Subscription Rights, the Subscription Rights will be
re-entered into the shareholder's book-entry account within approximately three
(3) business days after the withdrawal notification has been submitted. If a
shareholder of the Company has sold or otherwise transferred its Subscription
Rights, such sale or transfer cannot be withdrawn. 

Public Trading of the Subscription Rights

Holders of Subscription Rights may sell their Subscription Rights at any time
prior to the end of the public trading of the Subscription Rights. Public
trading of the Subscription Rights on the Helsinki Stock Exchange commences on
2 December 2009 and ends on 10 December 2009. The price of the Subscription
Rights on the Helsinki Stock Exchange will be determined in market trading. The
Subscription Rights may be transferred by their holders by giving sell or
purchase assignments to the holder's own account operator or through any
securities broker. 

The trading code of the Subscription Rights is HKSAVU0109 and the ISIN code is
FI4000006952. 

Payment for the Subscriptions

The Subscription Price of the Offer Shares subscribed for in the Offering shall
be paid in full at the time of submission of the subscription assignment in
accordance with the instructions given by the subscription place or the account
operator. The subscription is considered to be submitted only as the
subscription form has been delivered to the place of subscription or any other
institution accepting subscription assignments and the Subscription Price has
been fully paid. 

Approval of the Subscriptions and Publication of the Result

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

In other cases than the over-subscription by virtue of the Secondary
Subscription the Board of Directors of the Company will approve all
subscriptions made pursuant to the Secondary Subscription in accordance with
these terms and conditions of the Offering and applicable laws and regulations. 

In case the Secondary Subscription is over-subscribed, the Company's Board of
Directors will approve the subscriptions made by the Company's shareholders in
the Secondary Subscription in proportion to the Subscription Rights used for
the subscription of the Offer Shares and, failing which, by drawing of lots up
to the maximum amount of their secondary subscriptions. In case of
over-subscription the paid Subscription Price representing the Offer Shares
that were not received will be refunded on or about 29 December 2009. No
interest will be paid on the refunded amount. 

If the Company's Board of the Directors decides to issue the Offer Shares,
which have not been subscribed for, to the investors determined by the Board of
Directors, the Board of the Directors of the Company may, according to its
consideration, approve or disapprove such subscriptions. 

The Company will publish the final results of the Offering in a stock exchange
release on or about 22 December 2009. 

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

The Offer Shares subscribed for in the Offering will be issued in book-entry
form in the book-entry securities system maintained by Euroclear Finland. All
the Offer Shares subscribed for in the Offering will be recorded on the
subscriber's book-entry account as interim shares corresponding to the Offer
Shares (ISIN code FI4000006945, trading code HKSAVN0109) after the subscription
has been effected. Trading in such interim shares as a separate class of
securities will commence on the first trading day following the end of the
Subscription Period on or about 18 December 2009. 

The interim shares will be combined with the Company's existing class of A
shares (ISIN code FI0009006308, trading code HKSAV) when the Offer Shares have
been registered with the Trade Register. Such combination is expected to occur
on or about 28 December 2009. The Offer Shares are freely transferable. The
trading in the Offer Shares on the Helsinki Stock Exchange is expected to
commence on or about 29 December 2009. 

Shareholder Rights

The Offer Shares will entitle their holders to full dividends declared by the
Company, if any, and to other shareholder rights in the Company after the Offer
Shares have been registered with the Trade Register and recorded in the
Company's shareholder register, on or about 28 December 2009. 

Payments and Expenses

No transfer tax or service fee is payable on the subscription of the Offer
Shares. Account operators and securities brokers, who exercise assignments
regarding the Subscription Rights, may charge a brokerage fee for these
assignments in accordance with their own price lists. Account operators also
charge a fee for the maintenance of the book-entry account and the deposit of
shares. 

Information

The documents referred to in Chapter 5, Section 21 of the Finnish Companies
Act, are available for review at the head office of the Company at Kaivokatu
18, FI-20520 Turku, Finland. 

Applicable Law and Dispute Resolution

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

Other Issues

The Board of Directors of the Company will resolve any other issues and
practical matters relating to the issue of the Offer Shares and the Offering.