SATS ASA: Contemplated private placement
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, JAPAN, HONG KONG, SOUTH AFRICA OR THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.
Oslo, 16 February 2022: SATS ASA (“SATS” or the “Company”) hereby announces a contemplated private placement of new shares in the Company (the “Offer Shares”) to raise gross proceeds of up to NOK 600 million (the “Private Placement”). The subscription price per Offer Share in the Private Placement will be set by the Company’s board of directors (the “Board”) on the basis of an accelerated bookbuilding process conducted by the Managers (as defined below).
The Company has appointed ABG Sundal Collier ASA and SpareBank 1 Markets AS as Joint Global Coordinators and Joint Bookrunners for the Private Placement (the “Joint Global Coordinators”), and Swedbank Norge, Norwegian branch of Swedbank AB (publ) (in cooperation with its affiliate Kepler Cheuvreux SA) as Joint Bookrunner (collectively, the “Managers”).
The net proceeds from the Private Placement will predominately be used to ensure sufficient strategic flexibility for the Company to act on potential organic and in-organic growth opportunities in the short to medium term and to ensure a more robust liquidity position in order to exploit opportunities in the longer run. As part of the Private Placement, the Company has also received commitments from its largest lender for a one year extension until September 2025 of NOK 2 billion of the current lending facilities and secured more flexible terms for the currently applicable covenants, which in combination with the contemplated Private Placement will establish a robust financial platform for further growth. The adjusted covenants will be applicable to and including 31 December 2023, subject to voluntary cancellation by the Company at any time. The adjusted covenants set out quarterly minimum levels for liquidity and reported EBITDA, with the latter entering into force from Q1 2023. SATS will not distribute any dividend to the shareholders during the amendment period and shall be compliant with the original covenants once the amendment period expires.
The Company’s two largest shareholders, TG Nordic Invest ApS (“TG”), an entity owned by TryghedsGruppen, owning ~29.9% of the Company, and AF III Holdco AS (“Altor”), an entity controlled by Altor Equity Partners, owning ~24.1% of the Company, are supportive of the Private Placement and have both pre-committed to subscribe pro rata in the Private Placement. Chairperson of the Board Hugo Maurstad has (through Funkybiz AS) pre-committed to subscribe for 500,000 Offer Shares. In addition, the Managers have through a limited wallcrossing exercise received additional indications of interest so that the Private Placement is covered on pre-commitments and indication of interests at the start of the Bookbuilding Period (as defined below).
The application period in the Private Placement will commence today, 16 February 2022, at 16:30 hours CET and close on 17 February 2022 at 08:00 hours CET (the “Bookbuilding Period”). The Company and the Managers may, however, at any time resolve to extend or shorten the Bookbuilding Period on short or no notice. If the Bookbuilding Period is extended or shortened, any other dates referred to herein may be amended accordingly.
The Private Placement will be directed towards selected Norwegian and international investors, in each case subject to and in compliance with applicable exemptions from relevant prospectus, filing and other registration requirements. The minimum application and allocation amount in the Private Placement has been set to the NOK equivalent of EUR 100,000. The Company may, however, at its sole discretion, allocate an amount below EUR 100,000 to the extent applicable exemptions from the prospectus requirement pursuant to applicable regulations, including Regulation (EU) 2017/1129 (the EU Prospectus Regulation) and ancillary regulations, are available. The Private Placement will be divided into two tranches. The first tranche will consist of up to 17,176,338 Offer Shares, representing approximately 10% of the outstanding shares in the Company (“Tranche 1” and the “Tranche 1 Offer Shares”) to be issued based on a board authorisation granted by the Company’s general meeting on 11 May 2021) (the “Board Authorisation”). The second tranche will consist of a number of Offer Shares that, together with Tranche 1, will raise gross proceeds of up to NOK 600 million (“Tranche 2” and the “Tranche 2 Offer Shares”). Completion of Tranche 2 will be subject to approval by an extraordinary general meeting of the Company expected to be held on or about 10 March 2022 (the “EGM”).
Allocation of Offer Shares will be determined by the Board at its sole discretion, in consultation with the Joint Global Coordinators, following the expiry of the Bookbuilding Period, however subject to approval by the EGM in respect of Tranche 2. TG and Altor have both agreed to be allocated shares in Tranche 2 and, as such, other applicants in the Private Placement are expected to predominately be allocated shares through Tranche 1.
The Company has agreed with the Joint Global Coordinators to a lock-up for a period of 180 days from the Board approval of the Private Placement, subject to customary exceptions. Furthermore, TG and Altor have agreed with the Joint Global Coordinators to a lock-up for a period of 90 days from the Board approval of the Private Placement, subject to customary exceptions.
Completion of Tranche 1 is subject to the Board resolving to complete Tranche 1 and to allocate and issue the Tranche 1 Offer Shares pursuant to the Board Authorisation. Completion of Tranche 2 is subject to (i) completion of Tranche 1, (ii) the EGM resolving to complete Tranche 2 and to allocate and issue the Tranche 2 Offer Shares and (iii) the registration of the share capital increase pertaining to the Tranche 2 Offer Shares with the Norwegian Register of Business Enterprises. Completion of Tranche 1 will not be conditional upon or otherwise affected by the completion of Tranche 2, and the applicants’ acquisition of Tranche 1 Offer Shares will remain final and binding and cannot be revoked, cancelled or terminated by the respective applicants if Tranche 2, for whatever reason, is not completed. Investors being allocated shares in the Private Placement undertake to vote in favour of Tranche 2 at the EGM.
Settlement of the Tranche 1 Offer Shares is expected to take place on a delivery versus payment basis by delivery of existing and unencumbered shares in the Company, that are already listed on the Oslo Stock Exchange, to be borrowed from AF III Holdco AS by the Joint Global Coordinators pursuant to a share lending agreement entered into between the Joint Global Coordinators, the Company and AF III Holdco AS. Settlement of the Tranche 2 Offer Shares is expected to take place following registration of the share capital increase pertaining to the Tranche 2 Offer Shares in the Norwegian Register of Business Enterprises as soon as possible after the completion of the EGM.
The Company reserves the right to, at any time and for any reason, to cancel the Private Placement (prior to the Board approval of the issuance of the Tranche 1 Offer Shares) and/or to modify the terms of the Private Placement. Neither the Company nor the Managers will be liable for any losses incurred by applicants if the Private Placement is cancelled, irrespective of the reason for such cancellation.
The Private Placement represents a deviation from the shareholders’ pre-emptive right to subscribe for the Offer Shares. The Board has considered the Private Placement in light of the equal treatment obligations under the Norwegian Public Limited Companies Act, the Norwegian Securities Trading Act, the rules on equal treatment under Oslo Rule Book II for companies listed on the Oslo Stock Exchange and the Oslo Stock Exchange’s Guidelines on the rule of equal treatment, and deems that the proposed Private Placement is in compliance with these obligations. The Board is of the view that it will be in the common interest of the Company and its shareholders to raise equity through a private placement, in particularly in light of the current market conditions and the growth opportunities currently available to the Company. By structuring the equity raise as a private placement, the Company is expected to raise equity efficiently, with a lower discount to the current trading price, at a lower cost and with a significantly reduced completion risk compared to a rights issue. It has also been taken into consideration that the Private Placement is based on a publicly announced accelerated bookbuilding process. As the Private Placement is structured to ensure that a market based subscription price is achieved, it is currently not planned to conduct a subsequent repair offering directed towards shareholders not participating in the Private Placement.
Advokatfirmaet Thommessen AS is acting as legal advisor to the Company in connection with the Private Placement.
For further information, please contact:
Cecilie Elde, Chief Financial Officer, phone: +47 924 14 195
Martin Stenshall, acting Finance and Investor Relations Manager, phone: +47 473 38 331
This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to section 5-12 the Norwegian Securities Trading Act. This stock exchange announcement was published by Martin Stenshall, acting Finance and Investor Relations Manager on 16 February 2022 at 16:30 CET on behalf of the Company.
SATS is a Nordic fitness club chain, with over 260 clubs, and operating through its brands and concepts SATS, ELIXIA, Fresh Fitness, HiYoga and Mentra by SATS. SATS has a broad training offering with great flexibility for its almost 670,000 members, including modern fitness equipment, individual and group training, personal training, online training, physiotherapy and other health and fitness related products and services. SATS is headquartered in Oslo, and has close to 9,000 in Norway, Sweden, Finland and Denmark. For more information about SATS, please see www.satsgroup.com.
The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy, fairness or completeness. None of the Managers or any of their respective affiliates or any of their respective directors, officers, employees, advisors or agents accepts any responsibility or liability whatsoever for, or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available, or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith. This announcement has been prepared by and is the sole responsibility of the Company.
Neither this announcement nor the information contained herein is for publication, distribution or release, in whole or in part, directly or indirectly, in or into or from the United States (including its territories and possessions, any State of the United States and the District of Columbia), Australia, Canada, Japan, Hong Kong, South Africa or any other jurisdiction where to do so would constitute a violation of the relevant laws of such jurisdiction. The publication, distribution or release of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
This announcement is not an offer for sale of securities in the United States. The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act, and may not be offered or sold in the United States absent registration with the U.S. Securities and Exchange Commission or an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any securities referred to herein in the United States or to conduct a public offering of securities in the United States.
Any offering of the securities referred to in this announcement will be made by means of a set of subscription materials provided to potential investors. Investors should not subscribe for any securities referred to in this announcement except on the basis of information contained in the aforementioned subscription material. In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the EU Prospectus Regulation, i.e. only to investors who can receive the offer without an approved prospectus in such EEA Member State. The expression “EU Prospectus Regulation” means Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (together with any applicable implementing measures in any Member State).
This communication is only being distributed to and is only directed at persons in the United Kingdom that are “qualified investors” within the meaning of the EU Prospectus Regulation as it forms part of English law by virtue of the European Union (Withdrawal) Act 2018 and that are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) or (ii) high net worth entities, and other persons to whom this announcement 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”). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.
This announcement is made by, and is the responsibility of, the Company. The Managers and their affiliates are acting exclusively for the Company and no-one else in connection with the Private Placement. They will not regard any other person as their respective clients in relation to the Private Placement and will not be responsible to anyone other than the Company, for providing the protections afforded to their respective clients, nor for providing advice in relation to the Private Placement, the contents of this announcement or any transaction, arrangement or other matter referred to herein.
In connection with the Private Placement, the Managers and any of their affiliates, acting as investors for their own accounts, may subscribe for or purchase shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such shares and other securities of the Company or related investments in connection with the Private Placement or otherwise. Accordingly, references in any subscription materials to the shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, such Managers and any of their affiliates acting as investors for their own accounts. The Managers do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.
Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as “believe”, “aim”, “expect”, “anticipate”, “intend”, “estimate”, “will”, “may”, “continue”, “should” and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies, and other important factors which are difficult or impossible to predict and are beyond its control. Such risks, uncertainties, contingencies, and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. Forward-looking statements speak only as of the date they are made and cannot be relied upon as a guide to future performance. The Company, each of the Managers and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any forward-looking statement contained in this announcement whether as a result of new information, future developments or otherwise. The information, opinions and forward-looking statements contained in this announcement speak only as at its date and are subject to change without notice.