BEWi enters into SPA to acquire Synbra; will assess preconditions for a bond issuance; presents prel. financial information for Jan & Febr 2018

Press release 2018-03-22 at 23:00

On 14 February 2018, BEWi Group AB (publ) (“BEWi”), a leading full-line supplier in the Nordic countries of particle foam products, announced its intention to acquire Synbra Holding B.V. (“Synbra”).

Today, BEWi has through a Dutch wholly-owned subsidiary, entered into a share purchase agreement to acquire all the shares in Synbra with certain funds managed by Gilde Buy Out Partners (“Gilde”) and its co-investors as sellers. Completion of the acquisition is subject to financing and regulatory approval.

BEWi further announces that it will assess the preconditions for a bond issuance in an expected amount of EUR 75 million to finance the acquisition of Synbra. BEWi has mandated Nordea Bank AB (publ) as sole arranger and bookrunner for such bond issuance.

In order to present proforma financial information in connection with the transaction and the bond issuance, BEWi presents a preliminary financial information summary for the combined BEWi and Synbra group for January and February 2018.

Summary:

• BEWi announced its intention to acquire Synbra on 14 February 2018
• Today, BEWi has entered into a share purchase agreement to acquire all the shares in Synbra
• Purchase price will be a cash consideration of EUR 117.5 million (approximately SEK 1,165 million) on a cash and debt free basis. BEWi intends to finance the acquisition by cash (including proceeds from a sale and leaseback of properties), a directed share issue and a bond issuance
• BEWi has mandated Nordea as sole arranger and bookrunner for a bond issuance in an expected amount of EUR 75 million
• Closing of the Synbra acquisition is expected to take place during the first half of 2018, subject to customary conditions, regulatory approval and BEWi issuing a bond for the financing of the Synbra acquisition

Preliminary figures for BEWi, Synbra and proforma financials

The below presented financial information for the last 12 month period ending on 28 February 2018 is preliminary and has not been subject to audit or review by BEWi’s or Synbra’s auditors. BEWi reports in accordance with IFRS and Synbra reports in accordance with Dutch GAAP. The Preliminary figures for Synbra below have been converted into IFRS for the purposes of this summary.

Additional financial information about BEWi will be presented in the Q1 2018 report which is scheduled to be issued on 17 May 2018.

Note: The proforma figures are based on preliminary numbers for 2017 and January to February 2018 in BEWi and Synbra excluding lsobouw GmbH to which lost contribution due to operational issues in BEWi has been added as well as contribution related to annualization of pay-off from investments and acquisitions. lncreased rental cost following the divestment of real estates has been included as well as short term net synergies.

The proforma calculation is intended to describe a hypothetical situation if Synbra would have been acquired as per 1 January 2017 and is not indicative of the actual outcome of the operating results in the future.

Synbra’s figures in EUR have been converted to SEK at an exchange rate of EUR/SEK 9.90.

The transaction in brief:
The total purchase price for the shares in Synbra is EUR 117.5 million (approximately SEK 1,165 million) on a cash and debt free basis. BEWi intends to finance the acquisition through cash, a directed share issue and a bond issuance.

Share issue: As communicated on 15 March 2018, Frøya Invest AS and Gjelsten Holding AS have agreed to subscribe for new shares in BEWi in the total amount of SEK 400 million. Frøya Invest AS is owned by the Bekken family and currently owns 48.5% of the shares in BEWi. Gjelsten Holding AS is currently not a shareholder of BEWi.

Cash: As communicated on 14 February 2018, BEWi is about to divest three properties in Denmark and two properties in Sweden. The properties will be divested for a total value of SEK 113 million and leased back to BEWi with an annual rent of approx. SEK 11 million.

Bond issuance: As communicated on 14 February 2018, BEWi intends to finance the acquisition in part by way of a bond issuance. BEWi now announces that it will assess the preconditions for such bond issuance in an expected amount of EUR 75 million. BEWi has mandated Nordea Bank AB (publ) as sole arranger and bookrunner for such bond issuance. The new bonds will share security and rank pari passu with with BEWi’s existing SEK 550 million senior secured bonds 2017/2020.

IsoBouw Disposal: As communicated on 14 February 2018, Synbra announced its intention to dispose 66% of the shares in Synbra’s German subsidiary IsoBouw GmbH to a subsidiary of HIRSCH Servo Group (“HIRSCH”). Today, Synbra has signed an agreement with HIRSCH to dispose 66% of the shares in Synbra’s German subsidiary IsoBouw GmbH to HIRSCH and the remaining 34% of the shares in IsoBouw to BEWi through a wholly owned Swedish subsidiary. The divestment of IsoBouw to HIRSCH is subject to, inter alia, regulatory approval. In addition, HIRSCH has, through its wholly owned subsidiary HIRSCH Porozell GmbH, entered into an agreement with Saint-Gobain Rigips to acquire Saint-Gobain’s isolation operations conducted in three production units in Germany and completion of the disposal of IsoBouw to HIRSCH is conditional upon BEWi obtaining ownership of 34% of the shares in HIRSCH Porozell GmbH.

Following the disposal of 66% of the shares in IsoBouw to HIRSCH and the acquisition of 34% of the shares in HIRSCH Porozell GmbH neither IsoBouw nor HIRSCH Porozell GmbH will be subsidiaries of BEWi or part of the BEWi Group. However, BEWi will be minority owner in both companies and will participate in their further development.

It is anticipated that the Synbra and both IsoBouw and HIRSCH transactions will be concluded simultaneously during the first half of 2018.

About BEWi Group:
The BEWi Group was formed when the Norwegian family firm BEWi AS and Styrochem of Finland merged in 2014. In parallel with the merger, six production units were acquired from the UK packaging company DS Smith: the Danish firm DS Smith Flamingo with operations in Holbæk, Hobro, Tørring and Såby; and DS particle foam operations in Värnamo and Urshult in Sweden. BEWi had a turnover of SEK 1,607 million in 2016, employs approximately 300 people at 14 locations in the Nordic countries, and its headquarters are located in Solna, Sweden.

About Synbra:
Founded in 1957, Synbra has established itself as a market leader in its chosen geographies. Under private equity ownership since 2000, the business has been transformed through continuous product innovation, operational excellence and M&A. Headquartered in Etten-Leur, the Netherlands, Synbra has approximately 900 employees and operates 14 strategically located production facilities in the Netherlands, Denmark, Germany and Portugal.

For further information, please contact:
Christian Bekken, CEO, BEWi Group. Tel: +47 905 55 141
Marie Danielsson, CFO, BEWi Group. Tel: +46 70 661 00 47

Advisors

Arctic Securities has been engaged as financial advisor to BEWi regarding the acquisition of Synbra, the transaction with HIRSCH and the directed share issue and Nordea has been engaged as sole arranger and bookrunner for the bond issuance. Advokatfirman Lindahl has acted as legal advisor to BEWi.

The information is such that BEWi Group AB (publ) is required to disclose in accordance with the EU Market Abuse Regulation (596/2014/EU). The information was submitted for publication, through the agency of the contact persons set out above, at 23:00 CET on 22 March 2018.

BEWi Group manages and controls the entire chain from the manufacture of raw materials to finished products for the construction, packaging, and technical packaging industries. We invest in new techniques and development of innovative environmentally sound products, which creates value across the chain. As the market continues to grow, BEWi will also grow, both organically as well as through acquisitions in order to create positive synergies around purchases, raw material management, marketing information, customer focus, efficient production and administration.
BEWi Group is owned to 48.5% by the Norwegian family Bekken through BeWi Holding, to 48.% by Verdane Capital Advisors and to 3% by Group management.

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