Gram Car Carriers ASA: Contemplated equity private placement and listing on Euronext Growth Oslo

NOT FOR DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OF AMERICA AND THE DISTRICT OF COLUMBIA) (THE “UNITED STATES”), AUSTRALIA, CANADA, THE HONG KONG SPECIAL ADMINISTRATIVE REGION OF THE PEOPLE'S REPUBLIC OF CHINA OR JAPAN, OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.

Oslo, 12 January 2022; Gram Car Carriers ASA (“GCC” or the “Company”) has engaged the Managers (as defined below) to advise on and effect a contemplated equity private placement in the Company of up to approx. USD 121 million (the “Private Placement”) in conjunction with a listing in Euronext Growth Oslo.

The Company was established in 2021 to serve as the listed holding company for the fleet and operation of the complete Gram Car Carrier fleet of 16 vessels (the “Fleet”) through transfer from a preceding structure in Singapore in connection with the closing of this Private Placement (the “Transfers”).

In connection with the Private Placement, the Company will also complete the acquisition of two additional vessels from subsidiaries of F. Laeisz GmbH (“F. Laeisz”). In exchange for the sale of such vessels, F. Laeisz has pre-committed to subscribe for new shares in the Private Placement for an amount equal to up to approx. USD 61.6 million (the purchase price for the vessels). The pre-subscription by F. Laeisz is subject to certain conditions, including a minimum allocation of no less than the NOK equivalent of approx. USD 49.7 million (i.e. minimum 25.25% ownership upon full exercise of the over-allotment option and the Greenshoe Option as defined below). F. Laeisz will have board representation in the Company and will be subject to a lock-up (see below).

In addition to the pre-subscription by F. Laeisz, five cornerstone investors have, subject to certain customary terms and conditions, undertaken to subscribe for, and will be allocated Offer Shares for, a total amount of USD 37.4 million distributed as follows: USD 12 million from AL Maritime Holdings Pte. Ltd., USD 10 million from J. Lauritzen A/S, USD 6 million from KLP Alfa Global Energy, USD 6 million from AS Clipper and USD 3.4 million from Surfside Holding AS. Further, certain members of the Company’s management and Board, as well as certain existing shareholders, have collectively pre-committed to subscribe for approx. USD 6.75 million.

The Company

GCC is the world’s third-largest tonnage provider within the Pure Car Truck Carriers (PCTCs) segment with 18 vessels, including the two vessels from F. Laeisz, across the Distribution, Mid-size and Panamax segments. The Company serves as a trusted provider of high-quality vessels and logistics solutions ensuring safe, efficient and punctual shipment of vehicles for a network of clients comprising of major global and regional PCTC operators.

The Fleet is rolling off its current short to medium term charter contracts and the Company is in the process of re-contracting the Fleet on longer-term agreements in in a market with highly favourable supply/demand dynamics. The market upcycle underpins increased earnings visibility, improving economics and the Company’s disciplined capital allocation policy focused on direct shareholders returns through attractive dividends. GCC is focused on environmental, social and governance (ESG) performance and will measure, manage and report on material ESG topics.

The Private Placement

The Private Placement will consist of (i) a primary offering with gross proceeds of the NOK equivalent of approx. USD 115.6 million (the “Primary Offering”) by the issuance of new shares in the Company (the “New Shares”) at the Offer Price (as defined below) and (ii) an over-allotment offering of up to the NOK equivalent of approx. USD 5.4 million (i.e. 10% of the New Shares not being pre-subscribed by F. Laeisz) (the "Additional Shares" and together with the New Shares, the "Offer Shares") based on the Offer Price, subject to full exercise of the over-allotment option and the Greenshoe Option (as defined below).

The price per Offer Share will be NOK 53 per share (the "Offer Price"), representing a pre-money equity value of the Company of the NOK equivalent of approx. USD 60 million, assuming completion of the Transfers.

The net proceeds from the Primary Offering (USD 115.6 million) will, in combination with already contributed equity (USD 60 million), proceeds from bank (USD 222 million) and lease financing (USD 116 million), be used to facilitate the Transfers (USD 427 million), complete the acquisition of two vessels from F. Laeisz (USD 61.6 million), acquire a management company (USD 4 million), strengthen the Company’s balance sheet through repayment of debt, and for general corporate purposes.

The book building period in the Private Placement will commence today, 12 January 2022 at 09:00 CET and close on 14 January 2022 at 16:30 CET. The Managers and the Company may, however, at any time resolve to shorten or extend the book building period. If the book building period is shortened or extended, any other dates referred to herein may be amended accordingly.

The following parties have entered into customary lock up arrangements with the Managers in connection with the Private Placement: The Company (6 months), members of the Company’s management and Board (12 months), other existing shareholders (12 months / 3 month for Offer Shares acquired in the Private Placement), F. Laeisz (12 months) and certain minority vessel owners prior to the Transfers (6 months). 100% of the current outstanding shares have been locked up based on these agreements.

The Company has applied for, and will, subject to successful completion of the Private Placement (see below) and the necessary approvals from the Oslo Stock Exchange, list the shares of the Company on Euronext Growth Oslo, with first day of trading expected on or about 31 January 2022 (the “Listing”). The Board has resolved to pursue an up-listing on a regulated market operated by the Oslo Stock Exchange immediately following the Listing, with an ambition to complete the up-listing within 6-12 months, subject to, inter alia, favourable market conditions and the satisfaction of applicable listing requirements.

F. Laeisz has subject to certain conditions granted the Managers an option to acquire, at the Offer Price, a number of new shares in the Company equal to the number of Additional Shares to cover short positions resulting from any over-allotments made in connection with the Private Placement (the “Greenshoe Option”). The Greenshoe Option is exercisable, in whole or in part, within a 30-day period commencing at the first day of Listing.

Completion of the Private Placement is subject to completion of the Transfers and the acquisition of the vessels from F. Laeisz, the gross proceeds from the Private Placement not being less than the NOK equivalent of USD 115.6 million and customary conditions.

The Company reserves the right, at any time and for any reason, to cancel, and/or 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.

GCC investment highlights

  • Unique investment opportunity in leading PCTC tonnage provider
  • Attractive market opportunity with upcycle starting to unfold
  • GCC ideally positioned to capture a strengthening market with 25% and 77% open days in 2022 and 2023, respectively
  • Current market rates indicate net profit of USD 25 million and USD 59 million for 2022 and 2023, respectively, with further upside potential
  • Stated policy of returning minimum 50% of EPS through quarterly dividends

Advisors

Fearnley Securities AS and Pareto Securities AS are acting as joint global coordinators, and, Clarksons Platou Securities AS, Nordea Bank Abp, filial i Norge, Skandinaviska Enskilda Banken AB (publ) (Oslo Branch), and Swedbank Norge, Norwegian branch of Swedbank AB (publ) (in cooperation with Kepler Cheuvreux S.A) are acting as joint bookrunners (together, the “Managers”).

Wikborg Rein Advokatfirma AS is acting as legal advisor to the Company and F. Laeisz and Advokatfirmaet Thommessen AS is acting as legal advisor to the Managers.

For more information, please contact:

CEO Georg A. Whist

Telephone: +47 41 60 16 81

E-mail: georg.whist@gramcar.com

CFO Gunnar S. Koløen

Telephone: +65 9176 6661

E-mail: gunnar.koloen@gramcar.com

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 notice was published by the Oslo Stock Exchange, on GCC's behalf, at the time and date set out above.

Important notice:

This announcement is not and does not form a part of any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. Copies of this announcement are not being made and may not be distributed or sent into any jurisdiction in which such distribution would be unlawful or would require registration or other measures.

The Private Placement will be directed towards Norwegian and international investors, in each case subject to an exemption being available from offer prospectus requirements and any other filing or registration requirements in the applicable jurisdictions and subject to other selling restrictions. The minimum application and allocation amount has been set to the NOK equivalent of EUR 100,000. The Company may, however, at its sole discretion, allocate shares corresponding to an amount below EUR 100,000 to the extent applicable exemptions from the prospectus requirements pursuant to Regulation (EU) 2017/1129 and ancillary legislation are available.

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 applicable 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 part of the offering in the United States or to conduct a public offering of securities in the United States. Any sale in the United States of the securities mentioned in this announcement will be made solely to "qualified institutional buyers" as defined in Rule 144A under the Securities Act. Nordea Bank Abp, filial i Norge, will not participate in the solicitation, offer or sale of any shares within or directed into the United States and will not be involved in any activities relating to the shares within or directed into the United States.

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 Prospectus Regulation, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State. The expression "Prospectus Regulation" means Regulation (EU) 2017/1129 as amended (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 (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 for 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", "strategy", "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 the Company believe 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 their control. Actual events may differ significantly from any anticipated development due to a number of factors, including without limitation, changes in public sector investment levels, changes in the general economic, political and market conditions in the markets in which the Company operates, the Company's ability to attract, retain and motivate qualified personnel, changes in the Company's ability to engage in commercially acceptable acquisitions and strategic investments, and changes in laws and regulation and the potential impact of legal proceedings and actions. 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 Company does not make any guarantee that the assumptions underlying the forward-looking statements in this announcement are free from errors nor does it accept any responsibility for the future accuracy of the opinions expressed in this announcement or any obligation to update or revise the statements in this announcement to reflect subsequent events. You should not place undue reliance on the forward-looking statements in this announcement. The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice. The Company does not undertake any obligation to review, update, confirm, or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this announcement.

Neither the Managers nor any of their affiliates makes any representation as to the accuracy or completeness of this announcement and none of them accepts any responsibility for the contents of this announcement or any matters referred to herein.

This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. Neither the Managers nor any of its affiliates accepts any liability arising from the use of this announcement.

The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions.

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