Scanfil Oyj - Company Announcement

SCANFIL OYJ ANNOUNCES A RECOMMENDED CASH OFFER OF SEK 35 PER SHARE TO THE SHAREHOLDERS IN PARTNERTECH AB

This announcement is not an offer, whether directly or indirectly, in or into
Australia, Hong Kong, Japan, New Zealand, South Africa or the United States or
in or into any other jurisdictions where such offer pursuant to legislation and
regulations in such relevant jurisdictions would be prohibited by applicable
law. Shareholders not resident in Sweden who wish to accept the Offer (as
defined below) must make inquiries concerning applicable legislation and
possible tax consequences. Shareholders should refer to the offer restrictions
included in the section titled “Important notice” at the end of this
announcement and in the tender offer document which will be published before
the beginning of the acceptance period for the Offer. 

SCANFIL OYJ                   STOCK EXCHANGE RELEASE          25 May 2015      
8.30 A.M. 

SCANFIL OYJ ANNOUNCES A RECOMMENDED CASH OFFER OF SEK 35 PER SHARE TO THE
SHAREHOLDERS IN PARTNERTECH AB 

Scanfil Oyj (“Scanfil”) hereby announces a recommended cash offer to the
shareholders in PartnerTech AB (“PartnerTech” or the “Company”) to tender all
shares in PartnerTech to Scanfil for SEK 35 per share (the “Offer”). The shares
in PartnerTech are listed on Nasdaq Stockholm, Small Cap. 

“This transaction will provide Scanfil, and also PartnerTech, with the
possibility to expand its operations and service offering to the benefit of
customers, investors and employees. The combined company will be clearly the
leading EMS-company in the Nordic market with very comprehensive service
portfolio and factory network with strong global presence. Scanfil foresees
several merits in combining the two companies and are looking forward to take
the new group to the next level”, says Harri Takanen, chairman of the board of
directors of Scanfil. 

Summary

  -- All shareholders in PartnerTech are offered SEK 35 in cash per share.
  -- The price offered for each PartnerTech share represents a premium of 26.8
     percent compared to the closing price on 22 May 2015, the last trading day
     prior to the announcement, of SEK 27.60, and 58.6 percent compared to the
     volume-weighted average price per share over the 90 calendar days ending on
     22 May 2015 of SEK 22.07.
  -- The board of directors of PartnerTech has unanimously (note 1) recommended
     PartnerTech's share-holders to accept the Offer. PartnerTech's board of
     directors has in connection thereto obtained a fairness opinion from
     Sundling Wärn Partners, in which it is stated that the Offer is fair from a
     financial point of view subject to the preconditions and assumptions stated
     in the opinion.
  -- The two largest shareholders in PartnerTech, Bure Equity AB (“Bure”) and AB
     Traction (publ) (“Traction”), holding in aggregate approximately 65.9
     percent of the total number of shares and votes in PartnerTech, have
     undertaken towards Scanfil to accept the Offer, subject to certain
     conditions.
  -- An offer document regarding the Offer is expected to be made public on or
     about 26 May 2015.
  -- The acceptance period for the Offer is expected to begin on or about 27 May
     2015 and expire on or about 23 June 2015. Commencement of settlement is
     expected to begin approximately one week after the expiry of the acceptance
     period.

Background, reasons and consequences

PartnerTech is a global contract manufacturer and supplier of aftermarket
services operating in a number of markets and industries including e.g. oil and
gas and medtech and instrumentation in a number of geographies. In 2014,
PartnerTech´s net sales amounted to SEK 2,239 million (SEK 2,237 million in
2013), its gross profit to SEK 95 million (SEK 124 million in 2013) and the net
income to SEK -55 million (SEK 7 million in 2013). In 2014, PartnerTech´s cash
flow from operating activities was SEK -47 million (SEK 72 million in 2013). As
per 31 December 2014, PartnerTech´s total assets amounted to SEK 1,296 million,
its total equity to SEK 418 million and the net debt to SEK 263 million (note
2). 

PartnerTech is a limited liability company incorporated in Sweden and its
address is Skeppsbron 3, 201 22 Malmö, Sweden. The company is headquartered in
Malmö and listed on Nasdaq Stockholm. At the end of 2014, PartnerTech employed
a total of 1,379 people, of which around 72 percent were based outside Sweden.
The company has production facilities in Sweden, Finland, Norway, Poland, UK,
the U.S. and China. 

Scanfil has invested significant resources and time in evaluating PartnerTech
and foresees several merits in combining the two companies. Firstly and
foremost, the combined entity would be better pre-pared to meet the
increasingly demanding needs of its customers. Based on Scanfil´s experience,
such demands are best met by providing optimized service portfolio, offering
global manufacturing and supply chain network, and continuously pursuing
operational efficiency. In addition, Scanfil believes that combining the best
elements of each company's competencies and resources as well as their
processes and best practices can yield significant benefits. 

The aim is also to achieve significant synergy benefits in operational
expenses. The structural cost savings are expected e.g. from sourcing due to
larger procurement needs, rationalization of overlapping functions including
corporate functions and streamlining of the factory network, as well as general
administrative expenses including duplicate public company costs. Scanfil
expects that already carried out and ongoing restructuring efforts concerning
PartnerTech's Metal Precision Division will positively impact PartnerTech's
profitability already in 2016 (excluding restructuring costs). Scanfil's target
is to raise PartnerTech's operating profit to a minimum of 5 percent level in
2017 (excluding restructuring costs). In addition, on a going concern basis,
the expected annual cost synergies are estimated to amount to a minimum of EUR
5 million and expected to be fully reached approximately in 2017. 

The estimated non-recurring transaction and integration cost from the
acquisition amounts to approximately EUR 3 million. Costs relating to potential
restructuring measures cannot be estimated at this stage. The transaction is
expected to have a positive effect on Scanfil's earnings per share at the
latest in 2017. 

After the completion of the Offer, Scanfil will, together with the management
team of PartnerTech, determine the optimal strategy for PartnerTech's
operations as part of Scanfil. As Scanfil will continue to optimize its
footprint, it cannot be ruled out that certain locations and functions, whether
Scanfil's or PartnerTech´s, would be affected by the Offer. For instance,
PartnerTech´s Metal Precision Division has already today carried out
restructuring efforts as its profitability has been unsatisfactory. Save for
the restructuring of the Metal Precision Division, which can have an impact on
employments, Scanfil does currently not foresee any material changes to the
management and employees or their terms of employment, even though Scanfil of
course not can exclude such consequences in other parts of the combined entity. 

Based on their current operations, the combined net sales of PartnerTech and
Scanfil would have amounted to EUR 461 million (note 3)  in 2014 and the total
assets to EUR 272 million (note 4)  at the end of 2014. The combined financial
information is for illustrative purposes only and is not subject to or does not
take into account any strategic considerations. The combined financial
information gives an indication of the combined company's historical net sales
assuming the activities were included in the same company from the beginning of
year 2014. However, the combined financial information is based on a
hypothetical situation and should not be viewed as any indication of the future
or as pro forma financial information as one-time items, differences in
accounting principles and transaction costs have not been taken into account.
Neither the expected synergies, nor restructuring measures related to the
transaction have been included. 

Assuming that the Offer will be completed in accordance with its terms and
conditions, the transaction will increase Scanfil's turnover and operating
profit for year 2015. Previously, Scanfil has published the following guidance
for 2015: Scanfil expects its turnover to increase by 2-8 percent in 2015. Its
operating profit before non-recurring items for 2015 is expected to be EUR 13 -
17 million. 

Assuming that PartnerTech will be part of Scanfil and that PartnerTech's
turnover and operating profit will be developing in line with Q1/2015,
PartnerTech's impact to Scanfil in 2015 results in an increase of approximately
EUR 100 - 115 million in turnover and has a slightly positive impact on
operating profit (excluding transaction, integration and restructuring costs). 

The Offer

Consideration

All shareholders of PartnerTech are offered SEK 35 in cash for each share in
PartnerTech (the “Offer Price”). 

The Offer Price will be adjusted accordingly should PartnerTech, prior to the
settlement of the Offer, distribute any dividend or in any other way distribute
or transfer funds or assets to its shareholders. 

No commission will be charged in respect of the settlement of the shares
tendered to Scanfil under the Offer. 

Premiums

The Offer Price represents a premium of (note 5):

  -- 26.8 percent for the PartnerTech share compared to the closing price on 22
     May 2015, the last trading day prior to the announcement, of SEK 27.60; and
  -- 58.6 percent for the PartnerTech share compared to the volume-weighted
     average trading price over the 90 calendar days ending on 22 May 2015 of
     SEK 22.07.

Total value of the Offer

The total value of the Offer amounts to SEK 443,274,370 (note 6).

Acceptance period and settlement

The acceptance period for the Offer is expected to begin on or about 27 May
2015 and expire on or about 23 June 2015. Commencement of settlement is
expected to begin approximately one week after the expiry of the acceptance
period. 

Conditions for completion of the Offer

The completion of the Offer is conditional upon:

  1. that the Offer is accepted to the extent that Scanfil becomes the owner of
     more than 90 percent of the total number of shares in PartnerTech;
  2. that, with respect to the Offer, the acquisition of PartnerTech and the
     execution thereof, all necessary permits, approvals, decisions and similar
     clearances from authorities, including competition authorities, have been
     received, in each case on terms which, in Scanfil's opinion, are
     acceptable;
  3. that no information publicly disclosed by PartnerTech or otherwise made
     available to Scanfil by PartnerTech is materially inaccurate, incomplete or
     misleading or that any material information that should have been publicly
     disclosed by PartnerTech has not been so disclosed;
  4. that neither the Offer nor the acquisition of PartnerTech and its execution
     is wholly or partly prevented or materially adversely affected by any
     legislation or other regulation, court decision, public authority decision,
     action by third party or similar circumstance, which is actual or could
     reasonably be anticipated and is outside of the control of Scanfil, and
     which Scanfil could not reasonably have foreseen at the time of the
     announcement of the Offer;
  5. that no circumstance, which Scanfil did not have knowledge of at the time
     of the announcement of the Offer, has occurred or is likely to occur which
     has a material adverse effect on, or can reasonably be expected to have a
     material adverse effect upon the sales, results, liquidity, solidity,
     equity or assets of PartnerTech and its subsidiaries, taken as a whole; and
  6. that PartnerTech does not take any measures that are typically intended to
     impair the prerequisites for the implementation of the Offer.

Scanfil reserves the right to withdraw the Offer in the event that it is clear
that any, several or all of the above conditions are not fulfilled in whole or
in part or cannot be fulfilled. However, with regard to conditions (2) - (6),
such withdrawal will only be made provided that the non-fulfillment of such
condition is of material importance to Scanfil's acquisition of PartnerTech. 

Scanfil reserves the right to waive, in whole or in part, one or several of the
conditions above, including, with respect to condition (1) above, to complete
the Offer at a lower level of acceptance. 

Financing of the Offer

Scanfil has entered into a facility agreement with Nordea Bank Finland Plc
regarding financing of the Offer. 

Utilisation of the bank facility is conditional upon that all conditions of the
Offer are fulfilled or waived. Other than as set out above, there are no
conditions for utilisation of the facility which are not under the control of
Scanfil or its owners. 

Additional conditions for disbursement under the facility agreement, which are
under Scanfil's or its owners control and thus cannot be invoked by Scanfil in
order to withdraw from the Offer, are essentially that Scanfil has not failed
to fulfill certain limiting undertakings relating to the status of Scanfil or
its affairs, or certain limiting material undertakings in the facility
agreement and that Scanfil does not become insolvent or seeks to withdraw from
its contractual obligations. 

Following the completion of the Offer, Scanfil will also consider possibilities
to raise additional equity financing through a directed issue of new shares up
to a maximum amount of 10 percent of the issued and outstanding shares of
Scanfil. The aim of the potential equity issue would be to re-strengthen the
company's balance sheet as well as to widen the shareholder base. Any potential
decision on such equity issue (including details and timing) is subject to
various considerations, including market conditions. 

Recommendation by PartnerTech's board of directors

The board of directors of PartnerTech has unanimously (note 7) recommended
PartnerTech's shareholders to accept the offer. The board of directors of
PartnerTech has obtained a fairness opinion from Sundling Wärn Partners
concluding that, in their opinion and subject to the qualifications and
assumptions set out therein, the Offer Price under the Offer is fair to
PartnerTech's shareholders from a financial point of view. The recommendation
and the fairness opinion will be included in the offer document. 

Undertaking to accept the Offer

The two largest shareholders in PartnerTech, Bure and Traction, holding in
aggregate 8,341,380 PartnerTech shares (note 8) , representing approximately
65.9 percent of the total number of shares and votes in PartnerTech, have
undertaken towards Scanfil to accept the Offer. The undertakings are
conditional upon no third party announcing a public offer for all shares in
PartnerTech at a price per share that exceeds the value of the consideration
per share available under the Offer at that time by at least 5 percent (the “5
percent Hurdle”) and Scanfil deciding not to match such competing offer (the
“Right to Match”) within five business days. The 5 percent Hurdle and the Right
to Match apply on a revolving basis in the event of one or more revised
competing proposals by a competing bidder. The undertakings are further
conditional on Scanfil in all material aspects complying with applicable laws
and the provisions of Nasdaq Stockholm's Rules concerning Takeover Bids on the
Stock Market, including the policies and practices established by the Swedish
Securities Council (Sw. Aktiemarknadsnämnden). 

Approvals from competition authorities

The completion of the Offer is conditional upon, inter alia, all necessary
approvals or similar from competition authorities being obtained. Scanfil
expects such necessary approvals to be granted. 

Scanfil's holding of financial instruments in PartnerTech

Scanfil does currently not hold or control any shares in PartnerTech or any
holdings of financial instruments which gives Scanfil a financial exposure
equivalent to a shareholding in PartnerTech. Scanfil has not acquired any
shares in PartnerTech during the last six months prior to the announcement of
the Offer. 

Scanfil may acquire, or enter into arrangements to acquire, shares in
PartnerTech during the acceptance period. Any purchases made or arranged shall
be in accordance with Swedish law and dis-closed in accordance with applicable
rules. 

Due diligence

Scanfil has, in connection with the preparation of the Offer, conducted a
limited due diligence of confirmatory nature and, in connection therewith, met
with the CEO, the CFO and the Division Presidents of the Company. During the
due diligence, Scanfil has, inter alia, reviewed certain material agreements
and financial information. PartnerTech has informed Scanfil that no information
has been disclosed during this process to Scanfil that has not already been
made public and that can reasonably be expected to affect the price of
PartnerTech's shares. 

Description of Scanfil

Scanfil is a global contract manufacturer and systems supplier to
telecommunications systems manufacturers and professional electronics
customers. The key elements of Scanfil's operations include a vertically
integrated production system and the provision of services and supply chain
management to customers over the entire life cycle of the product. The company
is headquartered in Sievi, Finland, and listed on Nasdaq Helsinki. 

In 2014, Scanfil reported sales and operating profit of EUR 214.5 million and
EUR 16.2 million, respectively. At the end of 2014, Scanfil employed a total of
1,782 people, of which around 87 percent were based outside Finland. The
company has production facilities in China, Estonia, Hungary, Germany and
Finland. 

Scanfil is a limited liability company incorporated in Finland and its address
is Yritystie 6, 85410 Sievi, Finland. 

Preliminary timetable (note 9)

Preliminary date for publication of the offer document          26 May 2015

Preliminary dates for the acceptance period                       27 May - 23
June 2015 

Preliminary date of commencement of settlement               30 June 2015

Scanfil reserves the right to extend the acceptance period, as well as to
postpone the settlement date. 

Compulsory redemption proceedings and delisting

As soon as possible after Scanfil has acquired shares representing more than 90
percent of the total number of shares in PartnerTech, Scanfil intends to
commence compulsory redemption proceedings under the Swedish Companies Act
(2005:551) to acquire all remaining shares in PartnerTech. In connection
therewith, Scanfil intends to promote delisting of PartnerTech shares from
Nasdaq Stockholm. 

Applicable law and disputes

The Offer, as well as the agreements entered into between Scanfil and the
shareholders in PartnerTech as a result of the Offer, shall be governed and
construed in accordance with substantive Swedish law. Any dispute regarding the
Offer, or which arises in connection therewith, shall be exclusively settled by
Swedish courts, and the City Court of Stockholm shall be the court of first
instance. 

The Takeover Rules and the Swedish Securities Council's rulings regarding
interpretation and application of the Takeover Rules, including, where
applicable, the Swedish Securities Council's interpretation and application of
the formerly applicable Rules on Public Offers for the Acquisition of Shares
issued by the Swedish Industry and Commerce Stock Exchange Committee, are
applicable to the Offer. Further-more, Scanfil has, in accordance with the
Swedish Act on Public Takeovers on the Stock Market (Sw. lag (2006:451) om
offentliga uppköpserbjudanden på aktiemarknaden), on 20 May 2015 contractually
undertaken towards Nasdaq Stockholm to fully comply with said rules and
statements and to submit to any sanctions that can be imposed by Nasdaq
Stockholm in event of breach of the Takeover Rules. Scanfil has on 25 May 2015
informed the Swedish Financial Supervisory Authority (Sw. Finansinspektionen)
about the Offer and the above mentioned undertakings towards Nasdaq Stockholm. 

Advisors

Nordea and Aava Advisors are financial advisors and Roschier Advokatbyrå is
legal advisor to Scanfil in connection with the Offer. 



Scanfil Oyj

The board of directors



For additional information contact:
CEO Petteri Jokitalo, +358 44 7882 400.

Information is also available at Scanfil's website (www.scanfil.com).

Distribution         NASDAQ OMX, Helsinki
                           Major Media
                          www.scanfil.com

This information was submitted for publication on 25 May 2015 at 07.30 a.m.
(CET). 

Notes:

(1): Due to their assignments in Bure and Traction, respectively, which
companies have signed undertakings to tender their shares in PartnerTech in the
Offer (please see “Undertaking to accept the Offer” below), Bengt Engström,
Gösta Johannesson and Petter Stillström have not participated in the board of
directors' decision to recommend the Offer. However, the board of directors is
quorate also without those three board members as five out of eight board
members have the right to participate in the board of directors' deliberations
and decisions regarding the Offer. 
(2): The unaudited financial information presented herein is based on Scanfil´s
and PartnerTech´s audited financial statements for the full year 2013 and 2014. 
(3): SEK/EUR 9.0985
(4): SEK/EUR 9.3930
(5): Source for PartnerTech share prices: Nasdaq Stockholm.
(6): Based on 12,664,982 outstanding shares in PartnerTech.
(7): See footnote 1.
(8): Bure holds 5,404,140 PartnerTech shares and Traction holds 2,937,240
PartnerTech shares. 
(9): All dates are preliminary and subject to change.



Important notice

The Offer is not being made, directly or indirectly, in or into Australia, Hong
Kong, Japan, New Zealand, South Africa or the United States or in or into any
other jurisdictions where such offer pursuant to legislation and regulations in
such relevant jurisdictions would be prohibited by applicable law (together,
the “Restricted Jurisdictions”) or by use of mail or any other means or
instrumentality (including, without limitation, facsimile transmission,
electronic mail, telex, telephone and the Internet) of interstate or foreign
commerce, or of any facility of national security exchange, of any Restricted
Jurisdiction, and the Offer cannot be accepted by any such use, means,
instrumentality or facility of, or from within, any Restricted Jurisdiction.
Accordingly, this stock exchange release and any documentation relating to the
Offer are not being and should not be sent, mailed or otherwise distributed or
forwarded in or into any Restricted Jurisdiction. 

This stock exchange release is not being, and must not be, sent to shareholders
with registered addresses in any Restricted Jurisdiction. Banks, brokers,
dealers and other nominees holding shares for persons in any Restricted
Jurisdiction must not forward this stock exchange release or any other document
received in connection with the Offer to such persons. 

Statements in this stock exchange release relating to future status or
circumstances, including statements regarding future performance, growth and
other trend projections and the other benefits of the Offer, are
forward-looking statements. These statements may generally, but not always, be
identified by the use of words such as “anticipates”, “intends”, “expects”,
“believes”, or similar expressions. By their nature, forward-looking statements
involve risk and uncertainty because they relate to events and depend on
circumstances that will occur in the future. There can be no assurance that
actual results will not differ materially from those expressed or implied by
these forward-looking statements due to many factors, many of which are outside
the control of Scanfil. Any such forward-looking statements speak only as of
the date on which they are made and Scanfil has no obligation (and undertakes
no such obligation) to update or revise any of them, whether as a result of new
information, future events or otherwise, except for in accordance with
applicable laws and regulations.

Bifogade filer:

Scanfil Stock Exchange Release 25 May 2015.pdf