Altor PC AB[1] announces a recommended public cash offer to the shareholders in Permascand Top Holding AB

The Offer is not being made, and this press release may not be distributed, directly or indirectly, in or into, nor will any tender of shares be accepted from or on behalf of shareholders in Australia, Hong Kong, Japan, Canada, New Zealand or South Africa, or any other jurisdiction in which the making of the Offer, the distribution of this press release or the acceptance of any tender of shares would contravene applicable laws or regulations or require further offer documents, filings or other measures in addition to those required under Swedish law or otherwise contemplated in connection with the Offer. Shareholders should refer to the offer restrictions included in the section titled “Important information” at the end of this press release and in the offer document which will be published before the beginning of the acceptance period for the Offer. Shareholders in the United States should also refer to the section titled “Important information to shareholders in the United States” at the end of this press release.

PRESS RELEASE

19 December 2023

Altor PC AB[1] announces a recommended public cash offer to the shareholders in Permascand Top Holding AB

Altor PC AB (“Altor PC” or the “Offeror”), a company controlled by Altor Fund VI (No. 1) AB and Altor Fund VI (No. 2) AB (“Altor Fund VI”)[2], hereby announces a recommended public cash offer to the shareholders in Permascand Top Holding AB (“Permascand” or the “Company”), to tender all shares in Permascand to the Offeror at a price of SEK 17 per share (the “Offer”). Permascand’s shares are listed on Nasdaq First North Growth Market.

The Offer in brief

• The shareholders in Permascand are offered SEK 17 in cash per share in the Company. The total Offer value based of all shares in Permascand amounts to SEK 1,008 million.[3]
• The Board of Directors[4] of Permascand unanimously recommends the shareholders in Permascand to accept the Offer, based on, inter alia, a fairness opinion from Grant Thornton according to which the Offer is fair to Permascand’s shareholders from a financial point of view.
• The Offer represents a premium of 58 percent in relation to the closing price of SEK 10.75 on Nasdaq First North Growth Market on 18 December 2023, which was the last day of trading prior to the announcement of the Offer and 94 percent in relation to the volume weighted average price of SEK 8.78 on Nasdaq First North Growth Market during a period of 90 trading days prior to 18 December 2023.
• Norvestor VI L.P., Ulven Invest AB[5], 5J Holding AB[6] and Peter Lundström[7], shareholders in Permascand, representing approximately 68 percent of the shares and votes in the Company have, subject to certain conditions, irrevocably undertaken to accept the Offer.
• The acceptance period of the Offer is expected to commence on 19 December 2023 and end on 19 January 2024.
• Completion of the Offer is conditional upon, inter alia, the Offer being accepted to such extent that Altor PC becomes the owner of more than 90 percent of the total number of shares in Permascand and that no other party announces an offer to acquire shares in Permascand on terms that are more favourable than the Offer to the shareholders in Permascand.

“We have followed the company over the last year closely, and truly believe that there is a fantastic opportunity for Permascand to take significant share in the fast-growing hydrogen market as a supplier of a key and hard-to-manufacture component to electrolyzers.” Clara Zverina, Principal at Altor, continues. “We have increasingly invested in Green Transition companies, and Permascand is a perfect fit next to companies such as H2 Green Steel, Aira and Vianode. Given the significant investments required to increase manufacturing capacity, particularly in relation to the renewables end-market, we strongly believe that the company should be operated in a private setting during this transformative period.”

Background to and reasons for the Offer

Permascand is an independent technology-driven manufacturer of electrochemical solutions based on the Company’s proprietary catalytic coatings for clean tech applications. Permascand has supplied electrodes, electrochemical cells and aftermarket services to a variety of sectors for more than 50 years. Permascand is headquartered in Ljungaverk, Sweden, with operations including research and development, technology development and production and with sales organisations in Sweden, Germany and North America.

Altor has followed Permascand closely over the last year and is highly impressed by the development of Permascand, and the work done by the management team and employees so far. Altor see Permascand as a true pioneer within electrochemistry and believe the Company’s long-term track record, research and development capabilities and experience within electrode manufacturing is unique.

Given the significant capex investments required to increase manufacturing capacity, particularly in relation to the renewables end-market, Altor strongly believes that the Company should be operated in a private setting. Altor shares the Company’s and management’s vision in developing Permascand to become a global leader in electrode manufacturing and supply within the fast-growing green hydrogen industry, and identify potential in several areas, including:

• further strengthening Permascand’s position in Europe and globally as a leading electrode manufacturer;
• leveraging Permascand’s advantageous market position to capture a significant market share in green hydrogen as a supplier of high efficiency electrodes within the alkaline water electrolysis segment;
• expanding the existing capacity footprint to increase Permascand’s global market share within several end-markets;
• reinforcing the research and development department to sustain and bolster Permascand’s long-term competitive edge; and
• allocating investments towards employer branding initiatives and expand talent pool sourcing to attract top talent on a global scale.

Based on these intentions and Altor’s characteristics as an investor, the Offeror believe that Altor would be a suitable partner for Permascand for the next phase of growth.

Altor places great value on Permascand’s organisation and expects that the Offer will support growth and create long-term positive effects for employees, customers and other stakeholders impacted by the operations of Permascand. Altor PC has not made any resolutions that are expected to cause the Offer to have an impact on Permascand’s organisation, management teams or employees, including their terms of employment, or on the locations of Permascand’s operations.

The Offer

The Offeror offers the shareholders in Permascand SEK 17 in cash per share in the Company. No commission will be charged in connection with the Offer.

The total number of shares in Permascand is 59,313,529. The Offer comprises all shares in Permascand. The total Offer value based on all shares in Permascand amounts to approximately SEK 1,008 million.[8]

Bid premium

The Offer represents a premium of 58 percent in relation to the closing price of SEK 10.75 on Nasdaq First North Growth Market on 18 December 2023, which was the last day of trading prior to the announcement of the Offer and 94 percent in relation to the volume weighted average price of SEK 8.78 on Nasdaq First North Growth Market during a period of 90 trading days prior to 18 December 2023.

Conflict of interests

Ulven Invest AB, controlled by Ingar Jensen, member of the Board of Directors of Permascand, and Peter Lundström, CEO of Permascand, have entered into irrevocable undertakings to accept the Offer. Therefore, Ingar Jensen and Peter Lundström have not participated and is not participating in Permascand’s evaluation of, or decisions regarding, the Offer.

Permascand’s outstanding incentive programs

The Offer does not include any warrants held by Permascand’s subsidiaries or employees or rights granted by Permascand to its employees under any incentive program implemented by Permascand. Altor PC intends to treat participants in such programs or holders of warrants reasonably in connection with the Offer.

Commitments from shareholders in Permascand

Altor PC has received irrevocable undertakings to accept the Offer from the following shareholders in Permascand:

• Norvestor VI L.P., whose total ownership amounts to 26,363,614 shares, corresponding to approximately 44.45 percent of the shares and votes in the Company;
• Ulven Invest AB[9], whose total ownership amounts to 6,170,000 shares, corresponding to approximately 10.40 percent of the shares and votes in the Company;
• 5J Holding AB[10], whose total ownership amounts to 6,156,178 shares, corresponding to approximately 10.38 percent of the shares and votes in the Company; and
• Peter Lundström[11], whose total ownership amounts to 1,611,575 shares, corresponding to approximately 2.72 percent of the shares and votes in the Company.

The Offeror has thus, through irrevocable undertakings by shareholders to accept the Offer, secured acceptance from shareholders representing in total 40,301,367 shares, corresponding to approximately 68 percent of the shares and votes in Permascand. The irrevocable undertakings are, inter alia, conditional upon that the Offer is declared unconditional on or before 15 April 2024, and that the Offer is not withdrawn or lapses (for whatever reason).

Recommendation from the Board of Directors of Permascand[12]

The Board of Directors of Permascand unanimously recommends the shareholders in Permascand to accept the Offer, based on, inter alia, a fairness opinion from Grant Thornton Sweden AB according to which the Offer is fair to Permascand’s shareholders from a financial point of view. The recommendation will be published in a separate press release from the Permascand Board of Directors today.

Altor PC’s shareholding in Permascand

At the announcement of the Offer, the Offeror does not own any shares in Permascand, or any other financial instruments carrying a financial exposure equivalent to a shareholding in Permascand, nor has it acquired any shares or any other financial instruments in Permascand during the last six months prior to the announcement of the Offer. During the acceptance period of the Offer, the Offeror may acquire, or enter into arrangements to acquire, shares in Permascand. All such purchases or arrangements will be in accordance with the Takeover rules for certain trading platforms issued by the Swedish Stock Market Self-Regulation Committee (the “Takeover Rules”) and Swedish law and be disclosed in accordance with applicable rules.

Description of Altor PC and the financing of the Offer

Altor PC is a newly formed company controlled by Altor Fund VI. Altor PC, with corporate number 559461-0122, is domiciled in Sweden with its registered seat in Stockholm. Altor PC was founded on 20 November 2023 and registered with the Swedish Companies Registration Office (Sw. Bolagsverket) on 6 December 2023. Altor PC has never conducted and at present does not conduct any business, and its sole purpose is owning shares in Permascand, executing the Offer and completing the Offer and subsequent de-listing of the shares in Permascand from Nasdaq First North Growth Market.

The consideration payable in respect of the Offer is financed in full by funds available to Altor PC by way of an equity commitment letter issued by Altor Fund VI. Altor PC will thus have sufficient funds to fully pay the consideration in the Offer.

Due diligence

In relation to the preparations for the Offer, Altor has, on behalf of the Offeror, conducted a limited due diligence review of confirmatory nature regarding commercial, financial, legal, tax, regulatory and other information in relation to Permascand, and in connection therewith met with the Company’s management team. Permascand has confirmed that no information that could reasonably be expected to affect the price of the Company’s shares, and that has not been published by the date of this announcement, has been disclosed to the Altor in connection with said due diligence review.

Preliminary timetable

• Publication of offer document: on or about 19 December 2023
• Acceptance period: on or about 19 December 2023 – 19 January 2024
• Settlement date: on or about 26 January 2024

The Offeror reserves the right to extend the acceptance period as well as the right to defer the date for settlement.

Conditions for completion of the Offer

Completion of the Offer is conditional upon:

1. the Offer being accepted to such extent that the Offeror becomes the owner of more than 90 percent of the total number of outstanding shares in Permascand;
2. that no other party announces an offer to acquire shares in Permascand on terms that are more favourable than the Offer to the shareholders in Permascand;
3. that neither the Offer nor the acquisition of Permascand, is wholly or partly prevented or materially adversely affected by any legislation or other regulation, court decision, public authority decision or similar circumstance, which is actual or could reasonably be anticipated, which is outside the control of the Offeror and which the Offeror could not reasonably have foreseen at the time of the announcement of the Offer;
4. that, save as publicly announced by Permascand prior to the date the Offer was announced or as otherwise disclosed in writing to the Offeror prior to that date, the Offeror does not discover that any information publicly disclosed by Permascand or otherwise made available to the Offeror is materially inaccurate or misleading, or that any material information which should have been publicly disclosed by Permascand has not been so disclosed;
5. there being no circumstances, which the Offeror did not have knowledge about at the time of the announcement of the Offer, that have occurred that have a material adverse effect or could reasonably be expected to have an effect upon Permascand’s sales, results, liquidity, assets or equity; and
6. that Permascand does not take any measures that typically are intended to impair the prerequisites for the implementation of the Offer.

Altor PC reserves the right to withdraw the Offer in the event that it is clear that any of the above conditions is not satisfied or cannot be satisfied. However, with regard to conditions 2-6, the Offer may only be withdrawn provided that the non-satisfaction of such a condition is of material importance to the Offeror’s acquisition of Permascand.

The Offeror reserves the right to waive, in whole or in part, one, several or all of the conditions set out above, including, with respect to condition 1, to complete the Offer at a lower level of acceptance.

Compulsory redemption and delisting

In the event that the Offeror becomes the owner of more than 90 percent of the shares in Permascand, the Offeror intends to initiate a compulsory redemption procedure under the Swedish Companies Act (Sw. aktiebolagslagen (2005:551)) to acquire all remaining shares in Permascand.

In connection therewith, the Offeror intends to promote a delisting of the shares in Permascand from Nasdaq First North Growth Market.

Applicable law and disputes

The Offer, and the agreements entered into between the Offeror and Permascand’s shareholders as a result of the Offer, shall be governed by and construed in accordance with the laws of Sweden. The courts of Sweden shall have exclusive jurisdiction over any dispute arising out of or in connection with the Offer and the Stockholm District Court (Sw. Stockholms tingsrätt) shall be the court of first instance.

For the Offer, the Takeover Rules and the Swedish Securities Council’s rulings regarding the interpretation and application of the Takeover Rules and, 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 (Sw. Näringslivets Börskommitté) apply.

Advisors

SEB Corporate Finance is acting as financial advisor and White & Case is legal advisor to the Offeror in connection with the Offer.

Stockholm, 19 December 2023

Altor PC AB

The Board of Directors

The information in this press release has been published by Altor PC in accordance with the Takeover Rules. The press release was submitted for publication on 19 December 2023 at 08:00 (CET).

For additional information:

For additional information about the Offer, please see: www.permascandoffer.com and www.sebgroup.com/prospectuses.

For media enquiries, please contact:

Tor Krusell, Head of Communications, Altor

Email: tor.krusell@altor.com

Telephone: +46 705 43 87 47

Altor PC and Altor in brief

Altor PC

Altor PC is a newly formed company controlled by Altor Fund VI. Altor PC has never conducted and at present does not conduct any business, and its sole purpose is owning shares in Permascand, executing the Offer and completing the Offer and subsequent de-listing of the shares in Permascand from Nasdaq First North Growth Market.

Altor in brief

Since inception, the family of Altor funds has raised more than EUR 10 billion in total commitments. The funds have invested in just south of 100 companies. The investments have been made in medium-sized predominantly Nordic and DACH companies with the aim to create value through growth initiatives and operational improvements. Among current and past investments are Trioworld, OX2, FLSmidth, H2 Green Steel, Aira and Vianode.

For more information visit www.altor.com

Permascand in brief

Permascand is an independent technology-driven manufacturer of electrochemical solutions based on proprietary catalytic coatings for clean tech applications. The company has supplied electrodes, electrochemical cells and aftermarket services to a variety of sectors for more than 50 years. Permascand is headquartered in Ljungaverk, Sweden, with operations including research and development, technology development and production and with sales organizations in, Sweden, Germany and North America.

For more information visit: www.Permascand.com. Permascand’s Certified Adviser is FNCA Sweden AB.

Important information

The Offer, pursuant to the terms and conditions presented in this press release, is not being made to persons whose participation in the Offer requires that an additional offer document is prepared or registration effected or that any other measures are taken in addition to those required under Swedish law and regulations or otherwise contemplated in connection with the Offer.

This press release and any other documentation related to the Offer are not being distributed and must not be mailed or otherwise distributed or sent in or into any country in which the distribution or offering would require any such additional measures to be taken or would be in conflict with any law or regulation in such country – any such action will not be permitted or sanctioned by the Offeror. Any purported acceptance of the Offer resulting directly or indirectly from a violation of these restrictions may be disregarded.

The Offer is not being and will not be made, directly or indirectly, in or into, by use of mail or any other means or instrumentality of interstate or foreign commerce of, or any facilities of a national securities exchange of Australia, Hong Kong, Japan, Canada, New Zealand or South Africa. This includes, but is not limited to facsimile transmission, electronic mail, telex, telephone, the internet and other forms of electronic transmission. The Offer cannot be accepted and shares may not be tendered in the Offer by any such use, means, instrumentality or facility of, or from within Australia, Hong Kong, Japan, Canada, New Zealand or South Africa or by persons located or resident in Australia, Hong Kong, Japan, Canada, New Zealand or South Africa. Accordingly, this press release or any other documentation related to the Offer are not being and should not be mailed or otherwise transmitted, distributed, forwarded or sent in or into Australia, Hong Kong, Japan, Canada, New Zealand or South Africa or to any Australian, Hong Kong, Japanese, Canadian, New Zealand or South African persons or any persons located or resident in Australia, Hong Kong, Japan, Canada, New Zealand or South Africa.

Any purported tender of shares in the Offer resulting directly or indirectly from a violation of these restrictions will be invalid and any purported tender of shares made by a person located in Australia, Hong Kong, Japan, Canada, New Zealand or South Africa or any agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from or within Australia, Hong Kong, Japan, Canada, New Zealand or South Africa will be invalid and will not be accepted. Each person who holds shares and participates in the Offer will certify to not being an Australian, Hong Kong, Japanese, Canadian, New Zealand or South African person, not being located or participating in the Offer from Australia, Hong Kong, Japan, Canada, New Zealand or South Africa and not acting on a non-discretionary basis for a principal that is an Australian, Hong Kong, Japanese, Canadian, New Zealand or South African person, or that is located in or giving order to participate in the Offer from Australia, Hong Kong, Japan, Canada, New Zealand or South Africa. the Offeror will not deliver any consideration relating to the Offer to Australia, Hong Kong, Japan, Canada, New Zealand or South Africa.

This press release is not being, and must not be, sent to shareholders with registered addresses in Australia, Hong Kong, Japan, Canada, New Zealand or South Africa. Banks, brokers, dealers and other nominees holding shares for persons in Australia, Hong Kong, Japan, Canada, New Zealand or South Africa must not forward this press release or any other document related to the Offer to such persons.

The Offer, the information and documents contained in this press release are not being made, and have not been approved, by an authorised person for the purposes of section 21 of the Financial Services and Markets Act 2000, as amended (the “FSMA”). The communication of the information and documents contained in this press release to persons in the United Kingdom is exempt from the restrictions on financial promotions in section 21 of the FSMA on the basis that it is a communication by or on behalf of a body corporate which relates to a transaction to acquire shares in a body corporate and the object of the transaction may reasonably be regarded as being the acquisition of day to day control of the affairs of that body corporate within article 62 (Sale of body corporate) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005.

This press release has been published in Swedish and English. In the event of any discrepancy in content between the two language versions, the Swedish version shall prevail.

Forward-looking information

Information in this press release relating to future events or circumstances, including information regarding future results, growth and other projections as well as benefits of the Offer, are forward-looking information. Such information may generally, but not always, be identified by the use of words such as “anticipates”, “expects”, “believes”, or similar expressions. By its nature, forward-looking information involves risk and uncertainty, because it relates to events which depend on circumstances that may occur in the future. Due to several factors, of which a number of them are outside the Offeror’s control, there are no guarantees to that actual results will not materially differ from the results expressed or implied by the forward-looking information. Any such forward-looking information only applies as per the date it was given and the Offeror do not have any obligation (and undertake no such obligation) to update or revise it, whether as a result of new information, future events or otherwise, except as required by applicable laws and regulations.

Important information to shareholders in the United States

Shareholders in the United States are advised that Permascand’s shares are not listed on a U.S. securities exchange and that Permascand is not subject to the periodic reporting requirements of the U.S. Securities Exchange Act of 1934, as amended (the “U.S. Exchange Act”), and Permascand is not required to, and does not, file any reports with the U.S. Securities and Exchange Commission (the “SEC”) thereunder.

The Offer described in this press release will be made for the issued and outstanding shares in Permascand, a company incorporated under Swedish law and domiciled in Sweden, and is subject to Swedish disclosure and procedural requirements, which are different from those of the United States. The Offer will be made in the United States in compliance with Section 14(e) of the U.S. Exchange Act and the applicable rules and regulations promulgated thereunder, including Regulation 14E (in each case, subject to any exemptions or relief therefrom, if applicable) and otherwise in accordance with the disclosure and procedural requirements of Swedish law, including with respect to the Offer timetable, settlement procedures, withdrawal, waiver of conditions and timing of payments, which are different from those of the United States.

 The Offer is made to Permascand’s shareholders resident in the United States on the same terms and conditions as those made to all other shareholders of Permascand to whom an offer is made. Any information documents, including this press release, are being disseminated to U.S. shareholders on a basis comparable to the method that such documents are provided to Permascand’s other shareholders. Financial statements and financial information included in the information documents are prepared in accordance with IFRS that may not be comparable to the financial statements or financial information of U.S. companies.

In accordance with, and subject to the restrictions under, applicable laws, rules and regulations, including Rule 14e-5 under the U.S. Exchange Act, the Offeror and its affiliates or its brokers and its broker’s affiliates (acting as agents for, on behalf of or in concert with, the Offeror or its affiliates, as applicable) may from time to time after the date of this press release and during the pendency of the Offer, and other than pursuant to the Offer, directly or indirectly, purchase, or arrange to purchase, outside the United States, shares in Permascand that are the subject of the Offer or any securities that are convertible into, exchangeable for or exercisable for such shares before or during the period in which the Offer remains open for acceptance. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices. To the extent information about such purchases or arrangements to purchase is made public in Sweden, such information will be disclosed by means of a press release or other means reasonably calculated to inform U.S. shareholders of Permascand of such information. In addition, the financial advisors to the Offeror may also engage in ordinary course trading activities in securities of Permascand, which may include purchases or arrangements to purchase such securities.

To the extent required in Sweden, any information about such purchases will be made public in Sweden in the manner required by Swedish law.

Neither the SEC nor any U.S. state securities commission has approved or disapproved the Offer, passed upon the merits or fairness of the Offer, or passed any comment upon the adequacy, accuracy or completeness of the disclosure in this press release. Any representation to the contrary is a criminal offence in the United States.

The receipt of cash pursuant to the Offer by a U.S. holder of shares in Permascand may be a taxable transaction for U.S. federal income tax purposes and under applicable U.S. state and local, as well as foreign and other, tax laws. Each holder of shares in Permascand is urged to consult its independent professional advisor regarding the tax consequences of accepting the Offer.

It may be difficult for Permascand’s shareholders to enforce their rights and any claims they may have arising under U.S. federal securities laws since the Offeror and Permascand are located in non-U.S. jurisdictions, and some or all of their respective officers and directors may be residents of non-U.S. jurisdictions. Permascand’s shareholders may not be able to sue the Offeror or Permascand or their respective officers or directors in a non-U.S. court for violations of the U.S. securities laws. It may be difficult to compel the Offeror and Permascand and their respective affiliates to subject themselves to a U.S. court’s judgment.