Componenta is preparing to strengthen its financial position by a convertible capital loan of EUR 30 - 40 million and through significant changes in the structure of its balance sheet

Componenta has on 4 December 2015 announced that it has started financial negotiations to secure the company’s liquidity and implementation of the strategy that is being prepared. Componenta published additional information about the progress of the negotiations on 11 March 2016.  Componenta is preparing a financial solution to secure the continuity of its operations and to strengthen its financial position. In the planned solution, Componenta is, among other things, aiming to issue a new convertible capital loan, to negotiate arrangements concerning the current secured loans of the parent company, to negotiate on the financing of the Turkish subsidiary with the Turkish banks and to divest its piston business.

The Board of Directors has decided to convene an extraordinary general meeting on 15 April 2016 to resolve on the authorization for the Board of Directors to resolve on an issue of shares and an issuance of special rights entitling to shares. The aggregate amount of shares to be issued based on the authorization, including shares received based on special rights entitling to shares, would not exceed 100,000,000 shares. The Board of Directors will propose to the same general meeting that it approves a new share-based incentive scheme for top management to incentivize and commit them to the company. A notice to the general meeting will be published as a separate stock exchange release. It is intended that based on the authorization the company will, in the first phase, issue a capital loan that may be converted into shares, amounting tentatively up to a total of EUR 30 - 40 million. The convertible capital loan would be subscribed for by a limited number of selected professional investors. The loan subscriptions could be paid using cash or receivables from the company. The exchange rate for the shares is planned to be 50 cents. The exchange rate is based on the prevailing market price of the company’s shares and on preliminary indications from the investors. In relation to the convertible capital loan, the company has received preliminary conditional indications for more than EUR 20 million from certain institutional investors.

In addition, Componenta is surveying the divestment of its non-core business units. Componenta is currently negotiating the divestment of the Componenta Pistons unit that manufactures pistons and is located in Pietarsaari, Finland.

When realized, the planned arrangement will significantly strengthen the company’s balance sheet and will enable the implementation of the company’s new strategy. 

The planned arrangement is conditional and its implementation is subject to certain uncertainties. The company aims to publish more detailed information on the arrangement by 15 April 2016.

Helsinki, 24 March 2016

COMPONENTA CORPORATION
 

Harri Suutari
President and CEO

For further information, please contact:

Harri Suutari
President and CEO
tel. +358 400 384 937

Markku Honkasalo
CFO
tel. +358 10 403 2710

Componenta is a metal sector company with international operations and production plants located in Finland, Turkey, the Netherlands and Sweden. The net sales of Componenta were EUR 495 million in 2015 and its share is listed on Nasdaq Helsinki. The Group employs approx. 4,250 people. Componenta specializes in supplying cast and machined components and total solutions made of them to its global customers, who are manufacturers of vehicles, machines and equipment.