Initial public offering of Troax on Nasdaq Stockholm

Troax Group AB (publ) (“Troax” or the “Company”), a leading global supplier of indoor perimeter protection, and FSN Capital LP III Limited Partnership (“FSN”) announced on 27 February 2015 the intention to proceed with an Initial Public Offering (“IPO”) and listing on Nasdaq Stockholm. Troax and FSN have decided to proceed with the IPO through a sale of existing shares (the “Offering”). The first day of trading is expected to be 27 March 2015.

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Hillerstorp 16 March 2015, 07.00 CET

Troax is the leading global supplier of indoor perimeter protection for the market segments: Automation & Robotics, Material Handling & Logistics and Property Protection. The Company develops high quality and innovative safety solutions to protect people, property and processes. For the year ended 31December, 2014, Troax reported proforma net sales of EUR 91 million and proforma EBITA of EUR 17 million [1] .

The Offering in brief

  • The Offering is directed to the general public in Sweden and to institutional investors. The Offering comprises 10,713,507 existing shares in Troax offered primarily by the Company’s current principal owner FSN, corresponding to 54 percent of the total number of shares in the Company.
  • FSN has granted an over-allotment option of up to 1,607,026 additional shares, corresponding to up to 15 percent of shares in the Offering (approximately 8 percent of total number of shares in the Company).
  • If the over-allotment option is fully exercised, the Offering will comprise a total of 12,320,533 shares, corresponding to approximately 62 percent of the total number of shares in the Company.
  • The final price in the Offering is expected to be set within the range of SEK 62 – 66 per share (the “Offering price”), corresponding to a market value of all shares in Troax of SEK 1.24 – 1.32 billion. The Offering price is expected to be announced on 27 March 2015.
  • Leading investors Investment AB Latour and Svolder AB have committed, subject to certain conditions, to subscribe for shares in the Offering corresponding to 30.1 and 9.9 per cent of the Company’s total number of shares outstanding following the Offering, respectively.
  • A prospectus with full terms and conditions is published today 16 March 2015 on the Company’s website at www.troax.com .

[1] Adjusted for non-operating costs.

Thomas Widstrand , CEO of Troax says:

“Following 60 years of solving customers’ safety requirements, we have grown to become the global market leader of mesh panel solutions. With our stable, profitable and well invested company we are in a good position to strengthen our global market position further. We are proud to take the next step in our long term development by listing Troax on Nasdaq Stockholm and will continue to work hard to fulfill or exceed our customers’ expectations.”

Peter Möller , Partner at FSN Capital says:

“FSN is very pleased with the successful partnership with the management team and the Board of Directors of Troax during our time as majority owner. During our ownership period, Troax has further strengthened its market position and geographical footprint, in addition to investing heavily in the production facilities in Hillerstorp and Shanghai to support future growth. We believe that the structural growth drivers for Troax products, such as increased safety awareness, increased industrial automation and growth in e-commerce, combined with the entrepreneurial heritage from Småland, create a solid platform for continued profitable growth. We are very pleased that Latour and Svolder have expressed their intention to invest in Troax and we believe that their strong track record from internationalizing Swedish industrial companies will be highly valuable in the continued development of Troax.”

For additional information, please visit www.troax.com or contact:

Thomas Widstrand, CEO
Phone: +46 370 828 31

The Offering [2]

  • The Offering is directed to the general public in Sweden and to institutional investors.
  • The Offering comprises 10,713,507 existing shares in Troax offered primarily by the Company’s current principal owner FSN, corresponding to 54 percent of the total number of shares in the Company.
  • To cover potential over-allotment in connection with the Offering, FSN has undertaken, at the request of Carnegie Investment Bank AB (publ) (“Carnegie”) and Handelsbanken Capital Markets (“Handelsbanken”) (together the “Joint Bookrunners”), to sell up to 1,607,026 additional shares, corresponding to up to 15 percent of the number of shares comprised by the Offering (“the Over-Allotment option”), representing approximately 8 percent of the total number of shares in the Company.
  • Assuming that the Over-Allotment option is exercised in full, the Offering will comprise a total of 12,320,533 shares, corresponding to approximately 62 percent of the total number of shares in the Company.
  • The final Offering price is expected to be determined by FSN in consultation with the Joint Bookrunners, within a range of SEK 62 – 66 per share, based on the order book prepared in the book building procedure for institutional investors. The Offering price is expected to be announced on 27 March 2015. The Offering price to the general public in Sweden will not exceed SEK 66 per share.
  • The total value of the Offering based on the price range amounts to approximately SEK 664 – 707 million and approximately SEK 764 – 813 million assuming that the Over-Allotment option is exercised in full.
  • Based on the price range in the Offering, the market value of all shares in Troax is SEK 1.24 – 1.32 billion.
  • Leading investors Investment AB Latour and Svolder AB have committed to, subject to certain conditions, subscribe for shares in the Offering corresponding to 30.1 and 9.9 per cent of the Company’s total number of shares outstanding following the Offering, respectively.
  • The application period of the Offering to the general public in Sweden is expected to take place between 17 – 25 March 2015.
  • The book building period for institutional investors is expected to take place between 17 – 26 March 2015.
  • The first day of trading on Nasdaq Stockholm is expected to be on 27 March 2015 and the shares will trade under the ticker “TROAX”.
  • The expected settlement date of the Offering is 31 March 2015.

[ 2] The figures in this section are based on the assumptions that the share conversion, the bonus issue and the reallocation of shares (as further described in the prospectus) have been carried out.

Background and reasons

Troax was founded in 1955 by four Axelsson brothers in Hillerstorp, Sweden. The Company has since then evolved from a generalist producer of wire products (e.g. dish racks and shopping carts) to a leading supplier of high quality metal based mesh panel solutions that enhance the safety and security for people, property and processes. Troax has developed into a global company with a sales organization with presence in 31 countries. The Company has production facilities in Sweden, UK, China and Italy which together with its large sales force constitute the platform from which Troax delivers its products and solutions to customers around the world. Troax is the global market leader in metal-based mesh panel solutions with a global market share of approximately 10 percent and in Europe, which is currently Troax’ main market, the Company has a market share of approximately 20 percent.

Troax’ current main owner, FSN, acquired the Company in January 2013 and since then, several important strategic initiatives have been launched to improve Troax’ operational efficiency, increase the Company’s sales force and broaden the Company’s geographical presence. In June 2014, the Company acquired Satech, a leading provider of mesh panel solutions on the Italian market, which has strengthened Troax European market position further. The board of directors and senior management of the Company believe that Troax is well positioned to deliver growth in revenue and earnings.

FSN’s business concept is to acquire and develop non-listed companies and when set targets have been met make an exit. Together with Troax’ current senior management, FSN has achieved several important strategic initiatives and strengthened the Company’s position. Troax is ready to expand and continue to grow based on these fulfillments. Consequently, FSN and Troax’ board of directors consider the current timing and market climate to be an appropriate time for FSN to reduce its ownership and list the Company.

The Offering and the listing will expand the shareholder base and enable Troax to access the Swedish and international capital markets to broaden the Company’s options for financing continued growth, both organically and through selective acquisitions. The board of directors and senior management of Troax consider the Offering and listing of the Company’s shares to be a natural and important step in Troax’ development, which will e.g. increase the awareness of Troax and its operations.

Prospectus and application forms

A prospectus and application forms for the Offering will be published today, 16 March 2015. The prospectus and application forms can be obtained from Carnegie, Handelsbanken branches as well as ordered from Troax. The prospectus and application forms are also available on Troax’ website ( www.troax.com ), Carnegie’s website ( www.carnegie.se ), and Handelsbanken’s website for prospectuses ( www.handelsbanken.se/investeringserbjudande ).

Indicative timetable

17 – 25 March 2015  Application period for the general public in Sweden

17 – 26 March 2015  Book building process for institutional investors

27 March 2015          Announcement of the final Offering price

27 March 2015          First day of trading on Nasdaq Stockholm

31 March 2015          Settlement

Advisors

Carnegie is acting as Global Coordinator and Joint Bookrunner in the Offering and Handelsbanken is acting as Joint Bookrunner. Baker & McKenzie is legal adviser to the Company and the Principal Shareholder. White & Case is legal adviser to the Global Coordinator and Joint Bookrunners.

About Troax

Troax is the leading global supplier of indoor perimeter protection for the market segments: Automation & Robotics, Material Handling & Logistics and Property Protection. The Company develops high quality and innovative safety solutions to protect people, property and processes. Troax has a global organization and is currently represented in 31 countries and the Company’s head office is located in Hillerstorp, Sweden.

About FSN Capital

Since inception in 2000, FSN Capital’s funds have raised EUR 1.1 billion in total commitments and have to date made 23 platform investments in medium sized Nordic companies with the aim to create value through growth initiatives and operational improvements. Among current and past investments are Kjell & Company, Instalco, Actic, Aura Light and CTEK.

About Investment AB Latour

Investment AB Latour is a mixed investment company consisting primarily of wholly-owned industrial operations and an investment portfolio of listed holdings in which Latour is the principal owner or one of the principal owners. The investment portfolio consists of nine substantial holdings that had a market value of about SEK 31 billion as of 31 December 2014. The wholly-owned industrial operations generated a turnover of approximately SEK 7.6 billion in 2014.

About Svolder AB

Svolder is a dedicated investment trust that invests in the shares of listed small and medium-sized Swedish companies. The company is located in central Stockholm with five employees. The company is since 1993 listed on NASDAQ Stockholm.

Important information

This announcement is not and does not form a part of any offer for sale of securities. Copies of this announcement are not being made and may not be distributed or sent into the United States, Australia, Canada, Japan or any other jurisdiction in which such distribution would be unlawful or would require registration or other measures. The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and accordingly may not be offered or sold in the United States absent registration or an exemption from the registration requirements of the Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any offering 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 prospectus. This announcement is not a prospectus for the purposes of Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the “Prospectus Directive”). Investors should not invest in any securities referred to in this announcement except on the basis of information contained in the aforementioned prospectus. In any EEA Member State other than Sweden that has implemented the Prospectus Directive, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State. This communication is only being distributed to and is only directed at persons in the United Kingdom 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. 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,” “expect,” “anticipate,” “intends,” “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 Troax 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. The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice.

Thomas Widstrand
President and CEO
Troax Group AB
Box 89
330 33 Hillerstorp
+46 (0)370-82831
http://www.troax.com
thomas.widstrand@troax.com

About Troax

Troax is the leading global supplier of indoor perimeter protection (“metal-based mesh panel solutions”) for the market segments: Automation & Robotics, Material Handling & Logistics and Property Protection. Troax develops high quality and innovative safety solutions to protect people, property and processes.

Troax Group (publ), Reg. No. 556916-4030, has a global organisation with an unparalleled sales force and efficient logistics setup, enabling local presence and short delivery times in 31 countries. In 2014 Troax net sales amounted to around EUR 90 million and the number of employees amounted to about 400 persons. The Company’s head office is located in Hillerstorp, Sweden.

www.troax.com

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About Us

Troax is the leading global supplier of indoor perimeter protection (“metal-based mesh panel solutions”) for the market segments: Machine guarding, Warehouse partitioning and Property Protection. Troax develops high quality and innovative safety solutions to protect people, property, and processes. Troax Group AB (publ), Reg. No. 556916-4030, has a global organisation with a strong sales force and efficient logistics setup, enabling local presence and short delivery times in 36 countries. In 2016 Troax net sales amounted to 116 MEUR and the number of employees amounted to 600 persons. The Company’s head office is located in Hillerstorp, Sweden.

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Quotes

“Following 60 years of solving customers’ safety requirements, we have grown to become the global market leader of mesh panel solutions. With our stable, profitable and well invested company we are in a good position to strengthen our global market position further. We are proud to take the next step in our long term development by listing Troax on Nasdaq Stockholm and will continue to work hard to fulfill or exceed our customers’ expectations.”
Thomas Widstrand, CEO of Troax