KlaraBo announces offering of B-shares and publishes prospectus prior to listing on Nasdaq Stockholm

NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, WITHIN OR INTO THE UNITED STATES, AUSTRALIA, HONG KONG, JAPAN, CANADA, NEW ZEELAND, SWITZERLAND, SINGAPORE, SOUTH AFRICA, OR ANY OTHER JURISDICTION IN WHICH THE PUBLICATION, DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL OR REQUIRE REGISTRATION OR ANY OTHER MEASURES. THIS PRESS RELEASE DOES NOT CONSTITUTE AN OFFER TO ACQUIRE SECURITIES. PLEASE SEE ”IMPORTANT INFORMATION” AT THE END OF THE PRESS RELEASE.

KlaraBo Sverige AB (publ) (”KlaraBo” or the ”Company”) today announces, in accordance with what was communicated by the Company on November 15, 2021, an offer to the general public in Sweden and institutional investors in Sweden and abroad, consisting of newly issued B-shares in KlaraBo corresponding to SEK 750 million (the “Offering”) excluding potential over-allotment option as well as listing of the Company’s class B-shares on Nasdaq Stockholm. Due to the Offering and the listing on Nasdaq Stockholm, the Company has prepared a prospectus, which today has been approved by the Swedish Financial Supervisory Authority (the "SFSA") (Sw. Finansinspektionen) and published on the Company’s website. First day of trading in the Company's class B share is expected to be on 2 December 2021.

The Offering in brief

• The Offering is directed to the general public in Sweden and institutional investors in Sweden and abroad.
• The application period for the general public in Sweden is expected to take place from 23 November to 30 November 2021 and the application period for institutional investors is expected to take place between 23 November to 1 December 2021.
• Price per class B-share in the Offering is SEK 35.
• The Offering consists of 21,428,572 newly issued B-shares, corresponding to proceeds of SEK 750 million before deduction of costs attributable to the Offering.
• Number of shares in KlaraBo before the Offering amounts to 107,185,026, of which 16,815,000 are A-shares and 90,370,026 are B-shares.
• The Offering, assuming it is fully subscribed, excluding potential over-allotment option, corresponds to a post-money equity value of SEK 4,501 million.
• To cover any over-allotments in the Offering, the Company has granted an option to ABG Sundal Collier to issue an additional number of maximum 3,214,285 class B shares, corresponding to proceeds of SEK 112.5 million and maximum 15 per cent of the total number of shares in the Offering (“Over-allotment Option”).
• The newly issued shares in the Offering, provided that the Offering is fully subscribed and that the Over-allotment Option is fully exercised, are expected to provide the Company with proceeds of SEK 862.5 million before deduction of costs attributable to the Offering. The Offering, provided that the Offering is fully subscribed and that the Over-allotment Option is fully exercised, entails a dilution of 18.7 per cent of the total number of shares in the Company.
• KlaraBo intends to use the proceeds from the Offering to repay existing vendor notes from previous property acquisitions as well as for investments in existing properties, new construction and property acquisitions.
• Clearance Capital, Länsförsäkringar Fondförvaltning, M2 Asset Management AB and Fonden Odin Eiendom (the ”Cornerstone Investors”) have, subject to customary conditions and at the same price as other investors, committed to subscribe for shares in the Offering to an aggregate value of SEK 540 million.
• Some existing shareholders in KlaraBo have entered into so-called lock-up undertakings of 360 or 180 days from first day of trading. Based on KlaraBo’s share register as of November 10, 2021 and known changes thereafter, 79.7 per cent of the existing shares in KlaraBo are subject to lock-up commitments.
• First day of trading in the Company’s class B shares on Nasdaq Stockholm is expected to be on 2 December 2021. The Company’s class B shares will trade under the symbol (ticker) KLARA B.
• Expected settlement date is 6 December 2021.
• Complete information about the terms of the Offering can be found in the prospectus that the Company has prepared due to the Offering and the listing of the B-shares on Nasdaq Stockholm. The prospectus has today been approved by the SFSA and published on the Company’s website.

Background and reasons for the Offering
KlaraBo is a real estate company that owns, builds and actively manages attractive housing in Sweden with the aim of long-term ownership. The Company’s business concept is to manage and acquire residential properties in regions with population growth and a strong labour market, preferably with rent potential through value-enhancing renovations, as well as land for new construction of environmentally certified, cost-effective, in-house developed apartments in wooden construction.

KlaraBo was founded in 2017 in Malmö by the Company’s CEO Andreas Morfiadakis and the member of the board Mats Johansson and Anders Pettersson. The business started with developing its own building concept, KlaraBo-hus, which consists of newly built rental apartments with reasonable rents through cost-efficient and space-saving solutions. The business concept also encompassed acquisitions and management of existing properties, of which the management and board possess extensive experience. Through the Company’s ability to identify and complete acquisitions and projects, KlaraBo’s operations have expanded significantly.

The property portfolio, with a market value of SEK 7,405 million as of 30 September 2021, consists of investment properties with stable rental revenue as well as land and building rights for new construction. As of 30 September, the property portfolio consists of 5,367 rental apartments under management and 1,397 rental apartments in the project portfolio, of which 173 apartments are under construction. To date, KlaraBo has completed three new construction projects of 164 apartments, all of which have been fully let before completion. The properties are located from Trelleborg in the south to Sundsvall in the north and Visby in the east, and are divided into four administrative regions, South, Central, East and North. KlaraBo works with own staff to ensure good local knowledge, efficient property management and proximity to tenants. The project portfolio is mainly located in region South.

As of 30 September 2021, the lettable area of the investment properties totalled approximately 416,000 square metres and the contracted rental revenue amounted to SEK 454 million, of which residential rents accounted for 85 per cent, community service properties accounted for 8 per cent, commercial premises such as office and retail accounted for 4 per cent and other including storage and parking accounted for 3 per cent. Investments in existing properties and development of the project portfolio are important and value-creative components in KlaraBo’s operations and growth. Approximately 3,500 apartments in the property portfolio are estimated to have rent potential through standard-enhancing renovations, which corresponds to around 66 per cent of the property portfolio excluding new construction.

The board and management of the Company consider the listing of the Company’s B-shares a natural step in KlaraBo’s continued development. The main reason for listing on Nasdaq Stockholm is to create optimal conditions for continued growth. A listing will broaden KlaraBo’s ownership base and provides increased access to the capital market. In addition to more efficient capital raising, listing is expected to increase awareness of KlaraBo, which is expected to strengthen the profile of the Company towards stakeholders such as employees, tenants, municipalities and lenders.

Prospectus and application
The prospectus was approved today by the SFSA and published on KlaraBo’s website, www.klarabo.se. The prospectus will also be published on ABG Sundal Collier’s website (www.abgsc.com), Danske Bank’s website (www.danskebank.se/prospekt), Handelsbanken’s website (www.handelsbanken.se/prospekt) and Avanza’s website (www.avanza.se). Applications can be made on the online platform of Avanza and Handelsbanken.

The SFSA only approves the prospectus as meeting the standards of completeness, comprehensibility and consistency imposed by the Prospectus Regulation. The approval should not be considered as an endorsement of the Company or as an endorsement of the quality of the securities that are the subject of the prospectus and does not indicate that the SFSA guarantees that the facts in the prospectus are correct or complete.

Preliminary timetable

Stabilisation measures
In connection with the Offering, ABG Sundal Collier will act as stabilisation manager (the “Stabilisation Manager”) and may conduct transactions in order to maintain the market price of the Company's class B shares at a price level above that which might otherwise prevail in the open market. Such stabilisation transactions may be carried out on Nasdaq Stockholm, in the over-the-counter market or otherwise, at any time during the period starting on the date of commencement of trading in the Class B shares on Nasdaq Stockholm and ending not later than 30 calendar days thereafter. However, the Stabilisation Manager has no obligation to undertake any stabilisation measures and there is no assurance that stabilisation measures will be undertaken. Under no circumstances will transactions be conducted at a price higher than the one set in the Offering.

The Stabilisation Manager may use the Over-allotment Option to over-allot shares in order to facilitate any stabilisation transaction. The stabilisation transactions, if conducted, may be discontinued at any time without prior notice but must be discontinued no later than within the aforementioned 30-day period. The Stabilisation Manager must, no later than by the end of the seventh trading day after stabilisation transactions have been undertaken, in accordance with article 5(4) of the Market Abuse Regulation (EU) 596/2014 and the Commission Delegated Regulation (EU) 2016/1052, disclose that stabilisation measures have been undertaken. Within one week of the end of the stabilisation period, the Stabilisation Manager will disclose whether or not stabilisation measures were undertaken, the date on which stabilisation started, the date on which stabilisation was last carried out as well as the price range within which stabilisation was carried out for each of the dates when stabilisation measures were conducted.

Advisers
ABG Sundal Collier AB is Sole Global Coordinator and Joint Bookrunner. Danske Bank A/S, Danmark, Sverige Filial and Handelsbanken Capital Markets are Joint Bookrunners. Advokatfirman Lindahl is legal adviser to the Company and Baker McKenzie is legal adviser to the Sole Global Coordinator and the Joint Bookrunners.

For more information, please contact:
Andreas Morfiadakis, CEO KlaraBo
andreas.morfiadakis@klarabo.se
+46 76 133 16 61

About KlaraBo
KlaraBo is a real estate company that acquires, builds, owns and manages attractive residential properties. The company was founded in 2017 and operates throughout the country. The strategy is to acquire existing residential properties as well as land for new construction in regions with population growth and a strong labour market. Our newly constructed apartments are developed in-house and space efficient, which contribute to reasonable rents. Both apartments and buildings are designed in collaboration with the municipality to fit local needs. With wood as the main building material, the new construction holds a high environmental standard. KlaraBo is a long-term property owner.

Important information

The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to restrictions and the recipients of this press release in jurisdictions where this press release has been published or distributed shall inform themselves of and follow such legal restrictions. The recipient of this press release is responsible for using this press release, and the information contained herein, in accordance with applicable rules in each jurisdiction. This press release does not constitute an offer, or a solicitation of any offer, to buy or subscribe for any securities in the Company in any jurisdiction, neither from the Company nor from anyone else.

This press release does not constitute or form part of an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be sold in the United States absent registration or an exemption from registration under the US Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States. The information in this press release may not be announced, published, copied, reproduced or distributed, directly or indirectly, in whole or in part, within or into the United States, Australia, Canada, Hong Kong, Japan, South Africa or in any other jurisdiction where such announcement, publication or distribution of the information would not comply with applicable laws and regulations or where such actions are subject to legal restrictions or would require additional registration or other measures than what is required under Swedish law. Actions taken in violation of this instruction may constitute a crime against applicable securities laws and regulations.

This press release is not a prospectus for the purposes of Regulation (EU) 2017/1129 (the "Prospectus Regulation") and has not been approved by any regulatory authority in any jurisdiction. A prospectus has been prepared and in connection with the Offering scrutinized by the Swedish Financial Supervisory Authority (Sw. Finansinspektionen) which is the national competent authority in Sweden with regard to the Prospectus Regulation and published by the Company thereafter.

In the United Kingdom, this press release and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, "qualified investors" (within the meaning of the United Kingdom version of the EU Prospectus Regulation (2017/1129/ EU) which is part of United Kingdom law by virtue of the European Union (Withdrawal) Act 2018) who are (i) persons having professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.

This press release does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the new securities. Any investment decision to acquire or subscribe for securities in connection with the IPO must be made on the basis of all publicly available information relating to the Company and the Company’s securities. Such information has not been independently verified by the Joint Bookrunners. The Joint Bookrunners are acting for the Company in connection with the transaction and no one else and will not be responsible to anyone other than the Company for providing the protections afforded to its clients nor for giving advice in relation to the transaction or any other matter referred to herein.

The information in this press release may not be forwarded or distributed to any other person and may not be reproduced at all. Any forwarding, distribution, reproduction or disclosure of this information in its entirety or in any part is prohibited. Failure to follow these instructions may result in a breach of the Securities Act or applicable laws in other jurisdictions.

This press release does not constitute an invitation to warrant, subscribe, or otherwise acquire or transfer any securities in any jurisdiction. This press release does not constitute a recommendation for any investors' decisions regarding the IPO. Each investor or potential investor should conduct a self-examination, analysis and evaluation of the business and information described in this press release and any publicly available information. The price and value of the securities can decrease as well as increase. Achieved results do not provide guidance for future results. Neither the contents of the Company's website nor any other website accessible through hyperlinks on the Company's website are incorporated into or form part of this press release.

Forward-looking statements

This press release contains forward-looking statements that reflect the Company's intentions, beliefs, or current expectations about and targets for the Company's and the Group's future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies and opportunities and the markets in which the Company and the Group operates. Forward-looking statements are statements that are not historical facts and may be identified by words such as "believe", "expect", "anticipate", "intend", "may", "plan", "estimate", "will", "should", "could", "aim" or "might", or, in each case, their negative, or similar expressions. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurances that they will materialize or prove to be correct. Because these statements are based on assumptions or estimates and are subject to risks and uncertainties, the actual results or outcome could differ materially from those set out in the forward-looking statements as a result of many factors. 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 guarantee that the assumptions underlying the forward-looking statements in this press release are free from errors and readers of this press release should not place undue reliance on the forward-looking statements in this press release. The information, opinions and forward-looking statements that are expressly or implicitly contained herein speak only as of its date and are subject to change without notice. Neither the Company nor anyone else undertake 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 press release, unless it is not required by law or the Nasdaq Nordic Main Market for Issuers of Shares (Nasdaq Stockholm).

Information to distributors

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Company's securities have been subject to a product approval process, which has determined that such securities are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "EU Target Market Assessment"). Solely for the purposes of each manufacturer's product approval process in the United Kingdom, the target market assessment in respect of the securities in the Company has led to the conclusion that: (i) the target market for such securities is only eligible counterparties, as defined in the FCA Handbook Conduct of Business Sourcebook, and professional clients, as defined in Regulation (EU) No 600/2014 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018 ("UK MiFIR"); and (ii) all channels for distribution of such securities to eligible counterparties and professional clients are appropriate (the "UK Target Market Assessment" and, together with the EU Target Market Assessment, the "Target Market Assessment"). Notwithstanding the Target Market Assessment, Distributors should note that: the price of the Company's securities may decline and investors could lose all or part of their investment; the Company's securities offer no guaranteed income and no capital protection; and an investment in the Company's securities is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Offering. Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Bookrunners will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II or UK MiFIR; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Company's securities.

Each distributor is responsible for undertaking its own target market assessment in respect of the Company's securities and determining appropriate distribution channels.