Latour Industries AB announces a recommended cash offer of SEK 10.75 per share to the shareholders of Allgon AB (publ)

This announcement is not an offer, whether directly or indirectly, in Australia, Canada, Hong Kong, Japan, New Zealand or South Africa or in any other jurisdiction where such offer pursuant to legislation and regulations in such relevant jurisdiction would be prohibited by applicable law. Shareholders not resident in Sweden who wish to accept the Offer (as defined below) must make inquiries concerning applicable legislation and possible tax consequences. Shareholders should refer to the offer restrictions included in the section titled "Important information" at the end of this announcement and in the offer document which will be published in connection with the announcement of the Offer. Shareholders in the United States should also refer to the section titled "Special notice to shareholders in the United States" at the end of this announcement.

Latour Industries AB(1) ("Latour Industries") hereby announces a recommended public offer to the shareholders of Allgon AB (publ) ("Allgon" or the "Company") to tender all shares of series B(2) in Allgon to Latour Industries at a price of SEK 10.75(3) in cash per share (the "Offer"). The shares of Series B in Allgon are listed on Nasdaq First North Growth Market.

Summary

  • Latour Industries offers SEK 10.75 in cash per Allgon share of series B, corresponding to a total value of the Offer of approximately SEK 604 million(4).
  • The price of the Offer represents a premium of:
    • 30.5 per cent compared to the closing price on 11 December 2020 (the last day of trading prior to the announcement of the Offer) of SEK 8.24 for the shares;
    • 33.1 per cent compared to the volume-weighted average trading price of SEK 8.08 for the shares during the last 30 trading days ended on 11 December 2020 (the last day of trading prior to the announcement of the Offer); and
    • 41.1 per cent compared to the volume-weighted average trading price of SEK 7.62 for the shares during the last 180 trading days ended on 11 December 2020 (the last day of trading prior to the announcement of the Offer).
  • The board of directors of Allgon unanimously recommends Allgon's shareholders to accept the Offer.
  • Verdane Capital VI K/S, Verdane Capital VI B K/S, Tibia Konsult AB, Bertil Görling and Akei AB , together holding approximately 49.3 per cent of the shares and votes in Allgon, have undertaken to accept the Offer on certain conditions.
  • The Offer is conditional upon the Offer being accepted to such extent that Latour Industries becomes the owner of shares representing more than 90 per cent of the total number of outstanding shares in Allgon.
  • The offer document regarding the Offer will be made public today on 14 December 2020. The acceptance period for the Offer commences today on 14 December 2020 and expires on 22 January 2021.

Björn Lenander, CEO of Latour Industries, comments:

"We have been monitoring the market for industrial radio controls and find Allgon and its subsidiaries well positioned within a fragmented and growing market. The growth is driven by a global increasing demand for safe and reliable radio controls in many industrial activities. We see further opportunity in a consolidation in the market. Latour Industries will support the strategic agenda that the company has initiated and is looking forward working with the management towards the strategic objectives."

Background and reasons for the Offer

Allgon is a global leader in the industrial radio control market. The Company has a long history of developing, manufacturing and supplying critical solutions to its customers around the world. Allgon has about 350 employees in 19 countries with headquarter in Stockholm, Sweden.

Latour Industries has followed Allgon for a long time and is impressed by the Company and its leading position in the market for industrial radio control. Latour Industries is focused on investing in high quality businesses with leading market positions that operate in markets with clear underlying growth, and we see Allgon meeting all our investment criteria. Further, Latour Industries is convinced that Allgon could benefit from having a long-term owner with strong financial resources to accelerate the growth.

Latour Industries consists of six wholly-owned holdings and one part-owned holding, each of them with their own products with high technology content and a clear potential for growth. Allgon will form a new wholly-owned business line and operate as an independent entity within Latour Industries.

Latour Industries fully supports Allgon's strategy to become the market leader in industrial radio control through globalization and continue to invest and develop new technology. Further, Allgon will benefit from accelerated growth initiatives under the Latour Industries umbrella. Latour Industries' plans for the future business and general strategy do not currently include any material changes with regard to the Company's operational sites, and its employees, including their terms of employment.

The Offer

Consideration

The shareholders of Allgon are offered SEK 10.75 in cash per share of series B in Allgon.

Should Allgon, prior to the settlement of the Offer, distribute dividends or in any other way distribute or transfer value to its shareholders, the consideration in the Offer will be adjusted accordingly. In the event of either of the foregoing, Latour Industries reserves the right to determine whether this price adjustment mechanism or condition 7 to completion of the Offer (see below) shall be invoked.

No commission will be charged in respect of the settlement of the Allgon shares tendered to Latour Industries under the Offer.

Premiums

The price of the Offer represents a premium of(6):

  • 30.5 per cent compared to the closing price on Nasdaq First North Growth Market on 11 December 2020 (the last day of trading prior to the announcement of the Offer) of SEK 8.24 for the shares;
  • 33.1 per cent compared to the volume-weighted average trading price of SEK 8.08 for the shares during the last 30 trading days ended on 11 December 2020 (the last day of trading prior to the announcement of the Offer); and
  • 41.1 per cent compared to the volume-weighted average trading price of SEK 7.62 for the shares during the last 180 trading days ended on 11 December 2020 (the last day of trading prior to the announcement of the Offer).

Total value of the Offer

The total value of the Offer, based on all 56,222,597 outstanding shares in Allgon, amounts to approximately SEK 604 million.

Latour Industries' shareholding in Allgon

Neither Latour Industries nor any closely related companies or closely related parties own any shares or financial instruments in Allgon that give financial exposure to Allgon's shares at the time of the announcement of the Offer, nor has Latour Industries acquired or agreed to acquire any shares in Allgon or any financial instruments that give financial exposure to Allgon's shares during the six months preceding the announcement of the Offer.

Latour Industries may acquire, or enter into agreements to acquire, shares in Allgon outside the Offer and any purchases made or arranged will be disclosed in accordance with applicable rules.

Conditions for completion of the Offer

Completion of the Offer is conditional upon:

  1. the Offer being accepted to such extent that Latour Industries becomes the owner of shares representing more than 90 per cent of the total number of outstanding shares in Allgon;
  2. no other party announcing an offer to acquire shares in Allgon on terms that are more favorable to the shareholders of Allgon than the Offer;
  3. with respect to the Offer and completion of the acquisition of Allgon, receipt of all necessary regulatory, governmental or similar clearances, approvals, decisions and other actions from authorities or similar, including from competition authorities, in each case on terms which, in Latour Industries' opinion, are acceptable;
  4. neither the Offer nor the acquisition of Allgon being rendered wholly or partially impossible or significantly impeded as a result of legislation or other regulation, any decision of a court or public authority, or any similar circumstance;
  5. no circumstances having occurred which could have a material adverse effect or could reasonably be expected to have a material adverse effect on Allgon's financial position or operation, including Allgon's sales, results, liquidity, equity ratio, equity or assets;
  6. no information made public by Allgon, or otherwise made available to Latour Industries by Allgon, being inaccurate, incomplete or misleading, and Allgon having made public all information which should have been made public; and
  7. Allgon not taking any action that is likely to impair the prerequisites for making or completing the Offer.

Latour Industries reserves the right to withdraw the Offer in the event that it is clear that any of the above conditions are not satisfied or cannot be satisfied. However, with regard to conditions 2-7 above, the Offer may only be withdrawn where the non-satisfaction of such condition is of material importance to Latour Industries' acquisition of Allgon or if otherwise approved by the Swedish Securities Council (Sw. Aktiemarknadsnämnden).

Latour Industries reserves the right to waive, in whole or in part, one, several or all of the conditions set out above, including, with respect to condition 1 above, to complete the Offer at a lower level of acceptance.

Closely related party

The board member Per Nordlander is a closely related party to Verdane Capital VI K/S and Verdane Capital VI B K/S, that have undertaken to accept the Offer. In accordance with the takeover rules for certain trading platforms (the "Takeover Rules"), Per Nordlander has not participated, and will not participate, in Allgon's handling of or decisions concerning the Offer.(7)(8)  

Information about Latour Industries

Latour Industries is an investment company actively investing in the engineering industry. Latour Industries is owned by Latour-Gruppen Aktiebolag, which in turn is owned by Investmentaktiebolaget Latour (publ) ("Latour"), and represents one of five wholly-owned business areas.

Latour is a mixed investment company consisting primarily of wholly-owned industrial operations and an investment portfolio of listed holdings in which Latour is the principal owner or one of the principal owners. The investment portfolio consists of nine substantial holdings with a market value of about SEK 68 billion. The wholly-owned industrial operations have an annual turnover of about SEK 15 billion. Latour is quoted on Nasdaq Stockholm since 1985.

Financing of the Offer

The Offer is not subject to any financing condition. The Offer is fully financed by available cash on hand at Latour Industries.

Due diligence

Latour Industries has performed a limited confirmatory due diligence review of Allgon in relation to the preparation of the Offer and has in connection therewith met with Allgon's management team. Allgon has informed Latour Industries that no information has been disclosed to Latour Industries during the due diligence process which has not previously been disclosed and which is reasonably expected to affect the price of the shares in Allgon.

Approvals from authorities

The completion of the Offer is conditional upon, inter alia, all necessary clearances, approvals, decisions and other actions from authorities or similar, including approvals from competition authorities, being obtained, in each case on terms which, in Latour Industries' opinion, are acceptable. According to Latour Industries' assessment, the transaction will require the approval of the competition authority in Germany. Latour Industries has initiated the work on filing of the transaction in the relevant jurisdiction. Latour Industries expects that relevant clearances will be given prior to the end of the acceptance period.

Statement from the board of directors of Allgon and fairness opinion

The board of directors of Allgon has assessed the Offer and informed Latour Industries that the board of directors of Allgon has unanimously resolved to recommend to the shareholders of Allgon to accept the Offer, which is announced by Allgon today in a separate press release. The board of directors of Allgon has enlisted Öhrlings PricewaterhouseCoopers AB ("PwC") to provide a valuation opinion (a so-called fairness opinion) regarding the Offer. According to the fairness opinion, the Offer is fair for Allgon's shareholders from a financial point of view.

Undertakings from shareholders in Allgon

Latour Industries has obtained irrevocable undertakings to accept the Offer from Verdane Capital VI K/S, Verdane Capital VI B K/S, Tibia Konsult AB, Bertil Görling and Akei AB(9), holding in aggregate 27,743,935 Allgon shares, corresponding to approximately 49.3 per cent of the total shares and votes in Allgon.

The undertakings are conditional upon no other party, prior to the date when the Offer is declared unconditional, announcing a competing offer for all outstanding shares in Allgon at an offer price exceeding the price in the Offer by 7.5 per cent and Latour Industries resolving not to match such competing offer (the "Right to Match") within five business days. The Right to Match applies to any and all competing offers.

The irrevocable undertakings are terminated if the Offer is withdrawn or lapses (for whatever reason) and if Latour Industries, or any party acting in concert with Latour Industries, commits a material breach of mandatory applicable laws and regulations relating to the Offer, including the EU Market Abuse Regulation and the Takeover Rules.

Offer document

The offer document is available on Latour Industries' website (www.latourindustries.se/en/recommended-offer) and through Handelsbanken's website (www.handelsbanken.se/prospekt). A copy of the offer document and a pre-printed acceptance form will be sent to shareholders in Allgon whose shares were directly registered with Euroclear Sweden AB on 15 December 2020, except for those domiciled in the excluded jurisdictions (see above).

Preliminary timetable

Publication of the offer document: 14 December 2020
Acceptance period: 14 December 2020 – 22 January 2021
Settlement: 29 January 2021

Latour Industries reserves the right to extend the acceptance period, as well as to postpone the settlement date. A notice of any such extension or postponement will be announced by Latour Industries by means of a press release in accordance with applicable rules and regulations.

Compulsory redemption proceedings and delisting

If Latour Industries, whether in connection with the Offer or otherwise, acquires shares representing more than 90 per cent of the total number of shares in Allgon, Latour Industries intends to commence compulsory redemption proceedings under the Swedish Companies Act (Sw. aktiebolagslagen (2005:551)) to acquire all remaining shares in Allgon and to promote delisting of Allgon's shares from Nasdaq First North Growth Market.

Applicable law and disputes

The Offer, as well as the agreements entered into between Latour Industries and the shareholders in Allgon as a result of the Offer, shall be governed and construed in accordance with substantive Swedish law. Any dispute regarding the Offer, or which arises in connection therewith, shall be settled exclusively by Swedish courts, and the Stockholm District Court (Sw. Stockholms tingsrätt) shall be the court of first instance.The Takeover Rules and the Swedish Securities Council's statements and rulings regarding interpretation and application of these rules, including, where applicable, the Swedish Securities Council's interpretation and application of the formerly applicable Rules on Public Offers for the Acquisition of Shares issued by the Swedish Industry and Commerce Stock Exchange Committee (Sw. Näringslivets Börskommitté), are applicable to the Offer.

Advisors

Lazard is acting as sole financial advisor and Roschier Advokatbyrå AB is legal advisor to Latour Industries in connection with the Offer.
 

Latour Industries AB
The board of directors

 

Information about the Offer:
For enquiries, please contact:
Björn Lenander, CEO, Latour Industries
email: bjorn.lenander@latourindustries.se
Fredrik Lycke, Investment Director, Latour
email: fredrik.lycke@latour.se
Tel: +46 (0)31-38 12 899

For administrative questions regarding the Offer, please contact your bank or the nominee registered as holder of your shares.
The information in this press release was submitted for publication by Latour Industries and the contact person above in accordance with the Takeover Rules. The information was submitted for publication on 14 December 2020 at 08:00 a.m. (CET).
 

(1) A Swedish private limited liability company, with corporate registration number 556018-9754, domiciled in Gothenburg.
(2) Shares of series B is the only outstanding share class in Allgon.
(3) Should Allgon, prior to the settlement of the Offer, distribute dividends or in any other way distribute or transfer value to its shareholders, the consideration in the Offer will be adjusted accordingly.
(4) Based on 56,222,597 outstanding shares in Allgon.
(5) A company wholly-owned by Ola Samelius.
(6) Source for Allgon share prices: Nasdaq First North Growth Market.
(7) The board member Anna Stålenbring owns 10,000 shares in Allgon. Anna Stålenbring is also a board member in Troax Group AB (publ) ("Troax"). Latour Industries' indirect shareholder, Investmentaktiebolaget Latour (publ), owns approximately 30.1 of the shares in Troax. Against this background, it shall be noted that Anna Stålenbring has not, in any way, cooperated with Latour Industries in connection with the Offer.
(8) Anders Mörck, board member in Latour Industries and CFO in Investmentaktiebolaget Latour (publ) holds 34,400 shares in Allgon. The shares were acquired well before the work with the Offer commenced.
(9) A company wholly-owned by Ola Samelius.
(10) All dates are preliminary and may be subject to change.

 

Important information

This press release has been published in Swedish and English. In the event of any discrepancy in content between the two language versions, the Swedish version shall prevail.
The Offer is not being made, directly or indirectly, in or into Australia, Canada, Hong Kong, Japan, New Zealand or South Africa by use of mail or any other communication means or instrumentality (including, without limitation, facsimile transmission, electronic mail, telex, telephone and the Internet) of interstate or foreign commerce, or of any facility of national securities exchange or other trading venue, of Australia, Canada, Hong Kong, Japan, New Zealand or South Africa, and the Offer cannot be accepted by any such use or by such means, instrumentality or facility of, in or from, Australia, Canada, Hong Kong, Japan, New Zealand or South Africa. Accordingly, this press release or any documentation relating to the Offer are not being and should not be sent, mailed or otherwise distributed or forwarded in or into Australia, Canada, Hong Kong, Japan, New Zealand or South Africa.
This press release is not being, and must not be, sent to shareholders with registered addresses in Australia, Canada, Hong Kong, Japan, New Zealand or South Africa. Banks, brokers, dealers and other nominees holding shares for persons in Australia, Canada, Hong Kong, Japan, New Zealand or South Africa must not forward this press release or any other document received in connection with the Offer to such persons.
The Offer, the information and documents contained in this press release are not being made and have not been approved by an authorized person for the purposes of section 21 of the UK Financial Services and Markets Act 2000 (the “FSMA”). Accordingly, the information and documents contained in this press release are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of the information and documents contained in this press release is exempt from the restriction on financial promotions under section 21 of the FSMA on the basis that it is a communication by or on behalf of a body corporate which relates to a transaction to acquire day to day control of the affairs of a body corporate; or to acquire 50 per cent or more of the voting shares in a body corporate, within article 62 of the UK Financial Services and Markets Act 2000 (Financial Promotion) Order 2005.
Statements in this press release relating to future status or circumstances, including statements regarding future performance, growth and other trend projections and other benefits of the Offer, are forward-looking statements. These statements may generally, but not always, be identified by the use of words such as "anticipates", "intends", "expects", "believes", or similar expressions. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There can be no assurance that actual results will not differ materially from those expressed or implied by these forward-looking statements due to many factors, many of which are outside the control of Latour Industries. Any such forward-looking statements speak only as of the date on which they are made and Latour Industries has no obligation (and undertakes no such obligation) to update or revise any of them, whether as a result of new information, future events or otherwise, except for in accordance with applicable laws and regulations.
Lazard is not responsible to anyone other than Latour Industries for advice in connection with the Offer.
Special notice to shareholders in the United States
The Offer described in this press release is made for the issued and outstanding shares of Allgon, a company incorporated under Swedish law, and is subject to Swedish disclosure and procedural requirements, which may be different from those of the United States. The Offer is made in the United States pursuant to Section 14(e) of the U.S. Securities Exchange Act of 1934, as amended (the "U.S. Exchange Act") and Regulation 14E thereunder, to the extent applicable, and otherwise in compliance with the disclosure and procedural requirements of Swedish law, including with respect to withdrawal rights, the Offer timetable, notices of extensions, announcements of results, settlement procedures (including as regards to the time when payment of the consideration is rendered) and waivers of conditions, which may be different from requirements or customary practices in relation to U.S. domestic tender offers. Holders of the shares of Allgon domiciled in the United States (the "U.S. Holders") are encouraged to consult with their own advisors regarding the Offer.
Allgon's financial statements and all financial information included herein, or any other documents relating to the Offer, have been or will be prepared in accordance with IFRS and may not be comparable to the financial statements or financial information of companies in the United States or other companies whose financial statements are prepared in accordance with U.S. generally accepted accounting principles. The Offer is made to the U.S. Holders on the same terms and conditions as those made to all other shareholders of Allgon to whom an offer is made. Any information documents, including the offer document, are being disseminated to U.S. Holders on a basis comparable to the method pursuant to which such documents are provided to Allgon's other shareholders.

The Offer, which is subject to Swedish law, is being made to the U.S. Holders in accordance with the applicable U.S. securities laws, and applicable exemptions thereunder. To the extent the Offer is subject to U.S. securities laws, those laws only apply to U.S. Holders and thus will not give rise to claims on the part of any other person. The U.S. Holders should consider that the price for the Offer is being paid in SEK and that no adjustment will be made based on any changes in the exchange rate.

It may be difficult for Allgon's shareholders to enforce their rights and any claims they may have arising under the U.S. federal or state securities laws in connection with the Offer, since Allgon and Latour Industries are located in countries other than the United States, and some or all of their officers and directors may be residents of countries other than the United States. Allgon's shareholders may not be able to sue Allgon or Latour Industries or their respective officers or directors in a non-U.S. court for violations of U.S. securities laws. Further, it may be difficult to compel Allgon or Latour Industries and/or their respective affiliates to subject themselves to the jurisdiction or judgment of a U.S. court.

To the extent permissible under applicable law or regulations, Latour Industries and its affiliates or its brokers and its brokers’ affiliates (acting as agents for Latour Industries or its affiliates, as applicable) may from time to time and during the pendency of the Offer, and other than pursuant to the Offer, directly or indirectly purchase or arrange to purchase shares of Allgon outside the United States, or any securities that are convertible into, exchangeable for or exercisable for such shares. These purchases may occur either in the open market at prevailing prices or in private transactions at negotiated prices, and information about such purchases will be disclosed by means of a press release or other means reasonably calculated to inform U.S. Holders of such information. In addition, the financial advisors to Latour Industries may also engage in ordinary course trading activities in securities of Allgon, which may include purchases or arrangements to purchase such securities as long as such purchases or arrangements are in compliance with the applicable law. Any information about such purchases will be announced in Swedish and in a non-binding English translation available to the U.S. Holders through relevant electronic media if, and to the extent, such announcement is required under applicable Swedish or U.S. law, rules or regulations.

The receipt of cash pursuant to the Offer by a U.S. Holder may be a taxable transaction for U.S. federal income tax purposes and under applicable U.S. state and local, as well as foreign and other, tax laws. Each shareholder is urged to consult an independent professional adviser regarding the tax consequences of accepting the Offer. Neither Latour Industries nor any of its affiliates and their respective directors, officers, employees or agents or any other person acting on their behalf in connection with the Offer shall be responsible for any tax effects or liabilities resulting from acceptance of this Offer.

NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY U.S. STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THE OFFER, PASSED ANY COMMENTS UPON THE MERITS OR FAIRNESS OF THE OFFER, PASSED ANY COMMENT UPON THE ADEQUACY OR COMPLETENESS OF THIS PRESS RELEASE OR PASSED ANY COMMENT ON WHETHER THE CONTENT IN THIS PRESS RELEASE IS CORRECT OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES

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