Kojamo plc: Kojamo announces the preliminary price range for its planned initial public offering

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, THE HONG KONG SPECIAL ADMINISTRATIVE REGION OF THE PEOPLE'S REPUBLIC OF CHINA, JAPAN, SOUTH AFRICA OR THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.

Stock Exchange Release June 1, 2018, at 10:30 a.m. EET

Kojamo plc ("Kojamo" or the "Company") announces the preliminary price range for the share issue and the share sale in connection with its planned initial public offering (the "Offering"). The Company announced on May 21, 2018 that it is planning an initial public offering and listing of its shares on the official list of Nasdaq Helsinki Ltd ("Nasdaq Helsinki"). The subscription period for the Offering is expected to commence on June 4, 2018 at 10:00 a.m. EET.

The Offering in brief:

• The preliminary price range of the Offering is a minimum of EUR 8.50 and a maximum of EUR 10.00 per share (the "Preliminary Price Range"). 
• The market capitalization of the Company calculated based on the Preliminary Price Range would be approximately EUR 2,101 million - 2,445 million assuming that the Company raises gross proceeds of approximately EUR 150 million in the Offering.
• The Offering:
  • The Company aims to raise gross proceeds of approximately EUR 150 million by offering for subscription new shares in the Company (the "New Shares") (the "Share Issue"). The number of New Shares to be issued will be determined based on the final price per share for the Offer Shares (as defined below) (the "Final Offer Price").
  • Ilmarinen Mutual Pension Insurance Company, Varma Mutual Pension Insurance Company, the Finnish Industrial Union, Trade Union for the Public and Welfare Sectors, Finnish Construction Trade Union, Service Union United PAM, Trade Union PRO and Trade Union of Education in Finland (together the "Principal Sellers") and certain other existing shareholders of the Company (the "Other Sellers", and together with the Principal Sellers, the "Sellers")  will offer for purchase initially a minimum  of 39,202,312 and a maximum of 54,304,117 existing shares in the Company (the "Sale Shares").^[1]
  • An Over-allotment Option (as defined below) of in total a maximum of 10,396,510 Shares (as defined below) is expected to be granted by the Principal Sellers to Nordea as stabilizing manager (the "Stabilizing Manager"). The Additional Shares (as defined below) amount to a maximum of 15 percent of the Sale Shares and the New Shares.
  • The Offering consists of (i) private placements to institutional investors in Finland and internationally (the "Institutional Offering"), (ii) a public offering to private individuals and organizations in Finland (the "Public Offering") and (iii) an offering to all employees of Kojamo and to the members of the Management Team of Kojamo (the "Personnel Offering"). Only New Shares will be offered in the Personnel Offering and the final price per Offer Share in the Personnel Offering is 10 percent lower than the Final Offer Price in the Public Offering. Therefore, in the Personnel Offering, the final price per Offer Share may be a maximum of EUR 9.00.
• The value of the Offering based on the mid-point of the Preliminary Price Range is approximately EUR 748 million, assuming that the Company will raise gross proceeds of approximately EUR 150 million, the Sellers will sell the maximum number of Sale Shares and the Over-allotment Option will be exercised in full, and EUR 513 million, assuming that the Company will raise gross proceeds of approximately EUR 150 million, the Sellers will sell the minimum number of Sale Shares and the Over-allotment Option will not be exercised.
• The Offer Shares represent a maximum of approximately 32.9 percent of the shares in the Company (the "Shares") and all votes in the Company after the Share Issue assuming that (i) the Final Offer Price will be at the mid-point of the Preliminary Price Range, (ii) a total of 60,000 New Shares would be subscribed for in the Personnel Offering at the discount applicable to such New Shares, (iii) the Company will raise gross proceeds of EUR 150 million, (iv) the maximum amount of Sale Shares will be sold in the Offering and (v) the Over-allotment Option will be exercised in full. The Offer shares represent approximately 22.6 percent of the Shares and all votes in the Company after the Share Issue assuming that (i) the Final Offer Price will be at the mid-point of the Preliminary Price Range, (ii) a total of 60,000 New Shares would be subscribed for in the Personnel Offering at the discount applicable to such New Shares, (iii) the Company will raise gross proceeds of EUR 150 million, (iv) the minimum amount of Sale Shares will be sold in the Offering and (v) the Over-allotment Option will not be exercised. Unless the context indicates otherwise, the New Shares, the Sale Shares and the Additional Shares (as defined below) are together referred to herein as the "Offer Shares".
• The subscription period for the Institutional Offering will commence on June 4, 2018 at 10:00 a.m. EET and will end on June 14, 2018 at 12:00 p.m. EET.
• The subscription period for the Public Offering will commence on June 4, 2018 at 10:00 a.m. EET and will end on June 12, 2018 at 4:00 p.m. EET.
• The subscription period for the Personnel Offering will commence on June 4, 2018 at 10:00 a.m. EET and will end on June 12, 2018 at 4:00 p.m. EET.
• Trading in the Shares on Nasdaq Helsinki is expected to commence on the pre-list of Nasdaq Helsinki on or about June 15, 2018 and on the official list on or about June 19, 2018 under the trading code "KOJAMO".

CEO Jani Nieminen:

"The planned listing supports the realization of our growth strategy and increases Kojamo's strategic flexibility. Our goal is to raise approximately EUR 150 million of new capital in the offering, which is intended to be deployed to support our growth strategy.

Kojamo's vision is to be a frontrunner in the rental housing business and the customer's number-one choice.   Our strategy is to offer the best customer experience and increase the value and size of our investment properties in Finnish growth centres. We aim to generate shareholder value by increasing our real estate portfolio. Our goal is to own approximately 38,000 apartments and to have a fair value of investment properties of EUR 6 billion by the end of 2021. Today, Kojamo is Finland's largest private residential real estate company measured by fair value of investment properties."

Background and reasons for listing

Kojamo is the largest private residential real estate company in Finland measured by fair value of investments properties. It offers rental apartments and housing services for tenants primarily in the Helsinki region, the Tampere, Turku, Kuopio and Lahti regions as well as the cities of Oulu and Jyväskylä. As at March 31, 2018, Kojamo's portfolio comprised 35,697 rental apartments offering a wide range of rental housing alternatives. The fair value of Kojamo's investment properties was EUR 4.9 billion as at March 31, 2018. Approximately 98 percent of Kojamo's rental apartment portfolio is situated in the Finnish Growth Centers, approximately 82 percent in the Helsinki, Tampere and Turku regions and approximately 66 percent in the Helsinki region (all measured by fair value).  Kojamo has two business segments: Lumo and VVO. As at March 31, 2018, the Lumo segment included 34,468 apartments and the VVO segment included 1,229 apartments.

The objective of the Offering is to enable Kojamo to pursue its growth strategy and to improve its strategic flexibility. The listing would also allow Kojamo to obtain access to capital markets and broaden its ownership base both with domestic and foreign investors, which would increase the liquidity of the Shares. Furthermore, the Offering is expected to benefit Kojamo operationally (e.g., in recruiting and making Kojamo a stronger and more credible partner), strengthen Kojamo's recognition among customers, prospective employees, investors and the real estate and rental markets in general, and, thus, enhance Kojamo's competiveness. The Listing and increased liquidity would also enable Kojamo to use the Shares more effectively as a means of consideration in potential acquisitions and remuneration of personnel.

Details of the Offering and publication of the Finnish language prospectus

Preliminarily a maximum of 67,897,176 Offer Shares (without the Over-allotment Option) will be offered in the Institutional Offering in private placements to institutional investors in Finland and internationally and preliminary maximum of 4,000,000 Offer Shares will be offered in the Public Offering for subscription by private individuals and corporations in Finland, assuming that the Over-allotment Option will not be exercised. In the Personnel Offering, preliminarily a maximum of 60,000 New Shares will be offered to all employees of Kojamo and to the members of the Management Team of Kojamo.

The Preliminary Price Range is a minimum of EUR 8.50 and a maximum of EUR 10.00 per Share. The final price per Offer Share in the Personnel Offering is 10 percent lower than the Final Offer Price in the Public Offering. Therefore, in the Personnel Offering, the final price per Offer Share may be a maximum of EUR 9.00.

The Company aims to raise gross proceeds of approximately EUR 150 million by offering for subscription the New Shares. The Company will issue 16,222,184 New Shares assuming that (i) the Final Offer Price will be at the mid-point of the Preliminary Price Range, (ii) a total of 60,000 New Shares would be subscribed for in the Personnel Offering at the discount applicable to such New Shares and (iii) the Company will raise gross proceeds of no more than EUR 150 million.

The Sellers will offer for purchase preliminarily a minimum of 39,202,312 Sale Shares and a maximum of 54,304,117 Sale Shares in the Share Sale. The Sale Shares represent approximately 22.1 percent of the Shares and votes without the Over-allotment Option (approximately 26.3 percent with the Over-allotment Option) after the Share Issue assuming that the Sellers will sell the maximum amount of Sale Shares and that the Company will issue 16,222,184 New Shares (the number of New Shares has been calculated assuming that (i) the Final Offer Price will be at the mid-point of the Preliminary Price Range, (ii) a total of 60,000 New Shares would be subscribed for in the Personnel Offering at the discount applicable to such New Shares and (iii) the Company will raise gross proceeds of no more than EUR 150 million).

The Principal Sellers are expected to grant to the Stabilizing Manager an option exercisable within 30 days from the commencement of trading in the Shares on Nasdaq Helsinki, to purchase in total a maximum of 10,396,510 additional Shares (the "Additional Shares") solely to cover over-allotments in connection with the Offering (the "Over-allotment Option"). The Additional Shares represent approximately 4.2 percent of the Shares and votes in the Company after the Share Issue assuming that the Sellers will sell the maximum amount of Sale Shares and that the Company will issue 16,222,184 New Shares (the number of New Shares has been calculated assuming that the Final Offer Price will be at the mid-point of the Preliminary Price Range and a total of 60,000 New Shares would be subscribed for in the Personnel Offering at the discount applicable to such New Shares).

The Shares are not subject to public trading before the Offering. The Company will apply for the listing of the Shares on the official list of Nasdaq Helsinki. Trading in the Shares is expected to commence on the pre-list of Nasdaq Helsinki on or about June 15, 2018 and on the official list of Nasdaq Helsinki on or about June 19, 2018.

The Company has submitted a Finnish language prospectus for approval by the Finnish Financial Supervisory Authority. The Finnish language prospectus is expected to be approved on or about June 1, 2018. The Finnish language prospectus will be available through the Company's website, www.kojamo.fi/listautuminen, no later than on June 4, 2018. The Finnish language prospectus will also be available at the websites www.nordea.fi/kojamo and www.op.fi/merkinta. In addition, printed copies of the Finnish language prospectus are expected to be available on or about June 4, 2018 at the headquarters of the Company at Mannerheimintie 168a, FI-00301 Helsinki, as well as at the branch offices of Nordea in Finland (except branch offices with cash services only), at the branch offices of cooperative banks belonging to the OP Financial and at the service point of Nasdaq Helsinki at Fabianinkatu 14, FI-00100 Helsinki.

Goldman Sachs International ("Goldman Sachs"), J.P. Morgan Securities plc and Nordea Bank AB (publ), Finnish branch ("Nordea") have been appointed to act as joint global coordinators and joint bookrunners for the Offering (together the "Joint Global Coordinators"), and OP Corporate Bank plc has been appointed to act as joint bookrunner for the Offering (together with the Joint Global Coordinators, the "Managers"). Goldman Sachs and J.P. Morgan act as Joint Global Coordinators in the Institutional Offering only. Roschier, Attorneys Ltd. and Freshfields Bruckhaus Deringer LLP act as the legal advisers to the Company in the listing. White & Case LLP acts as the legal adviser to the Managers.

Further information about the Offering and places of subscription is available on the websites www.kojamo.fi/IPO, www.nordea.fi/kojamo, www.op.fi/merkinta, the branch offices of Nordea and at the branch offices of cooperative banks belonging to the OP Financial Group.

Important Dates

Additional information

Jani Nieminen, CEO of Kojamo, +358 20 508 3201

Erik Hjelt, CFO of Kojamo, +358 20 508 3225

For interview and other information requests:

Irene Kantor, Marketing and Communications Director of Kojamo, +358 20 508 3589

Important information

The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy, fairness or completeness. The information in this announcement may be subject to change.

The information contained herein is not for publication or distribution, directly or indirectly, in or into the United States. These written materials do not constitute an offer of securities for sale in the United States, nor may the securities be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder. The securities have not been and will not be registered under the U.S. Securities Act of 1933, as amended.

The issue, exercise or sale of securities in the offering are subject to specific legal or regulatory restrictions in certain jurisdictions. Neither the Company nor the Managers assume any responsibility in the event there is a violation by any person of such restrictions.

The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Investors must neither accept any offer for, nor acquire, any securities to which this document refers, unless they do so on the basis of the information contained in the applicable offering document prepared by the Company.

The Company has not authorized any offer to the public of securities in any Member State of the European Economic Area other than Finland. With respect to each Member State of the European Economic Area other than Finland and which has implemented the Prospectus Directive (each, a "Relevant Member State"), no action has been undertaken or will be undertaken to make an offer to the public of securities requiring publication of a prospectus in any Relevant Member State. As a result, the securities may only be offered in Relevant Member States (a) to any legal entity which is a qualified investor as defined in the Prospectus Directive; or (b) in any other circumstances falling within Article 3(2) of the Prospectus Directive. For the purposes of this paragraph, the expression an "offer of securities to the public" means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to exercise, purchase or subscribe the securities, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU.

This communication does not constitute an offer of the securities to the public in the United Kingdom. No prospectus has been or will be approved in the United Kingdom in respect of the securities. This communication is directed only at (i) persons who are outside the United Kingdom, or (ii) persons who are investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (iii) high net worth entities, and other persons to whom it 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"). Any investment activity to which this communication relates will only be available to and will only be engaged with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

None of the Managers or any of their respective affiliates, directors, officers, employees, advisers or agents accepts any responsibility or liability whatsoever for/or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith.

The Managers are each acting exclusively for the Company and for no-one else in connection with any transaction mentioned in this announcement and will not regard any other person (whether or not a recipient of this announcement) as a client in relation to any such transaction and will not be responsible to any other person for providing the protections afforded to their respective clients, or for advising any such person on the contents of this announcement or in connection with any transaction referred to in this announcement. The contents of this announcement have not been verified by the Managers.

This announcement does not constitute a recommendation concerning the Offering. The price and value of securities and any income from them can go down as well as up. Past performance is not a guide to future performance. Information in this announcement or any of the documents relating to the Offering cannot be relied upon as a guide to future performance. There is no guarantee that the listing on Nasdaq Helsinki will occur and you should not base your financial decisions on the Company's intentions in relation to the listing at this stage. Potential investors should consult a professional advisor as to the suitability of the Offering for the entity concerned.

In connection with the Offering, each of the Managers and any of their respective affiliates, acting as investors for their own accounts, may purchase shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such shares and other securities of the Company or related investments in connection with the Offering or otherwise. Accordingly, references in the prospectus, once published, to the shares being offered, acquired, sold, placed or otherwise dealt in should be read as including any offer, sale, acquisition, placing or dealing in the shares by any of the Managers and any of their affiliates acting as investors for their own accounts. In addition, certain of the Managers or their affiliates may enter into financing arrangements and swaps in connection with which they or their affiliates may from time to time acquire, hold or dispose of shares. None of the Managers intends to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

No representation or warranty, express or implied, is given by or on behalf of the Managers or any of their respective subsidiary undertakings, affiliates, agents or advisers or any of such persons' affiliates, directors, officers or employees or any other person as to the fairness, accuracy, completeness or verification of the information or the opinions contained in this announcement, and no liability is accepted for any such information or opinions. Each of the Managers or any such persons' directors, officers, employees or affiliates or any other person disclaim all and any responsibility and liability whatsoever, whether arising in tort, contract or otherwise, for any errors, omissions or inaccuracies in such information or opinions or for any loss, cost or damage suffered or incurred howsoever arising, directly or indirectly, from any use of this announcement or its contents or otherwise in connection with this announcement.

Forward-looking statements

This announcement includes forward-looking statements, which include statements regarding the Company's business strategy, operating and financial targets, financial condition, profitability, results of operations and market data, as well as other statements that are not historical facts. Words such as "believe," "anticipate," "plan," "expect," "target," "estimate," "project," "predict," "forecast," "guideline," "should," "aim," "continue," "could," "guidance," "may," "potential," "will," as well as similar expressions and the negative of such expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying these statements. By their nature, forward-looking statements are subject to numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those projected. Readers are cautioned not to place undue reliance on these forward-looking statements. Except for any ongoing obligation to disclose material information as required by the applicable law, the Company does not have any intention or obligation to publicly update or revise any forward-looking statements after it distributes this announcement, whether to reflect any future events or circumstances or otherwise.

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 Shares have been subject to a product approval process, which has determined that they each 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 (the "Target Market Assessment"); and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Appropriate Channels for Distribution"). Distributors should note that: the price of the shares may decline and investors could lose all or part of their investment; the shares offer no guaranteed income and no capital protection; and an investment in the shares 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 IPO.

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 (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 shares.

Each distributor is responsible for undertaking its own Target Market Assessment in respect of the shares and determining appropriate distribution channels.

^[1] The Company has on May 30, 2018 effected a share issue without consideration (split) in which 30 new shares were issued for each existing share. Following the share issue, the Company has 229,479,360 shares in total.