LumenRadio intends to list its shares on the Nasdaq First North Growth Market

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LumenRadio AB (publ) (”LumenRadio” or ”the Company”), today announces its intention to list the Company’s shares on the Nasdaq First North Growth Market (the ”Listing”). In connection with the Listing, LumenRadio intends to carry out a new issue of shares of around SEK 50 million (the ”Offer”). The Offer is also expected to consist of existing shares in the Company that are offered by certain shareholders. AB Grenspecialisten, Andra AP-fonden, Creades AB (publ) through a capital insurance (Sw. kapitalförsäkring), Fjärde AP-fonden, and Handelsbanken Fonder (”Cornerstone Investors”), have undertaken to acquire shares in the Offer corresponding to a total value of SEK 215 million. Board member Nicolas Hassbjer, CoB Magnus Terrvik, CEO Alexander Hellström and CFO Magnus Holm intend to acquire additional shares in the Offering corresponding to a total value at least SEK five (5) million. Trading in LumenRadio’s shares on the Nasdaq First North Growth Market is expected to begin in December 2022.

LumenRadio is a Gothenburg based technology company focusing on developing and selling reliable wireless product-to-product connections for business-critical applications within the Internet of Things (“IoT”). LumenRadio offers scalable solutions that build on proprietary and patented technology for future-proof wireless data transfer on open frequency bands, replacing traditional cables for control and automation. The Company has around 60 employees and is headquartered in Gothenburg, with two small sales offices in Frankfurt and Boston. Between the period 1 January 2022 – 30 September 2022, the Company’s net sales have amounted to SEK 144 million, corresponding to 65 per cent growth compared to the previous year. During the same period, the EBITDA margin amounted to 24 per cent and the gross margin to 61 percent.

LumenRadio operates through two different business areas: Lighting & Smart Cities (L&SC) as well as Building & Industrial Control Systems (B&ICS). The Company has long-term, solid experience of lighting control in major events, and LumenRadio’s customers have historically mainly consisted of companies that are established within professional lighting. In recent years, the Company has also strengthened its position within building automation as well as solutions for industrial communication. In 2021, the Company achieved sales of approximately SEK 125 million, where the L&SC business area accounted for 77 per cent of sales.

A significant share of LumenRadio’s revenues come from sales to OEMS through so called design wins. This means that the customer integrates LumenRadio’s technology in its products in the form of radio modules or software, generating license revenues for LumenRadio throughout the product’s life cycle.

The Company’s Board of Directors and management consider that the Offer and Listing of the Company’s shares are a logical and important next step in LumenRadio’s continued development building on the positive momentum and accelerating growth. The Listing will provide the Company with a broader base of new shareholders and access to the Swedish and international capital markets, which are expected to contribute positively to the Company’s continued development and growth.

CEO Alexander Hellström comment:     
”This is the beginning of an exciting next step for LumenRadio. During several years, we have invested in proprietary and patented technology for reliable wireless communication and today have a very strong customer base. We now see a great opportunity to grow in both existing and new markets, and at the same time invite new shareholders to join the company. We have an incredible journey behind us, and this listing means that we have the opportunity to accelerate our continued growth journey. Because although we already have achieved a lot, most of it is still in front of us.”

Chairman of the Board Magnus Terrvik comment:         
“I have been Chairman of the Board for LumenRadio since 2010 and have had the honour to see how the dedicated work by the whole team under CEO Alexander Hellström’s leadership has resulted in LumenRadio’s impressive growth and strong market position. Given the company’s long-term ambition to be a leading global player, the listing and broadening the shareholder base is a logical next step. This gives the company the extra strength it needs to reach our ambitious goals. We look forward to welcoming new shareholders to the company for its continuing exciting journey.“

The Offer in brief

Should the Company proceed with the Listing, the Offering is expected to consist of:

• An offering to the general public in Sweden.
• An offering to the institutional investors in Sweden and abroad.

The Offering to institutional investors will only be directed to certain institutional investors outside the United States pursuant to Regulation S in accordance with the S Securities Act of 1933, as amended (”Securities Act”).

The Offering is expected to consist of both newly issued shares and existing shares in the Company. With the newly issued shares the Offering is expected to bring gross proceeds of approximately SEK 50 million to the Company, before issue costs related to the Offering. ALMI Invest, ALMI Invest Västsverige, Chalmers Innovation, Chalmers Ventures and Latour Industries are expected to sell existing shares in the Offer. Further, one or more shareholders will undertake to sell existing shares in order to cover potential over-allotment in connection with the Offering, corresponding to not more than 15 per cent of the total number of shares included in the Offering.

LumenRadio intends to use the net proceeds from the new share issue in the Offering to position the Company for future growth, both organic as well as through acquisitions.

Full terms, conditions and instructions for the Offering will be included in the prospectus intended to be published by the Company in connection with the Listing and will then be available at the Company’s website www.lumenradio.com and Skandinaviska Enskilda Banken AB’s website www.seb.se.

Nasdaq Stockholm AB has made the assessment that LumenRadio fulfils the applicable listing requirements at Nasdaq First North Growth Market. Nasdaq Stockholm AB will approve an application for trading of the Company’s shares on Nasdaq First North Growth Market, provided that certain customary conditions are met, including that the Company submits such an application and that the distribution requirement for its shares is met.

Cornerstone Investors

The Cornerstone Investors have, subject to certain conditions, undertaken to acquire shares amounting to a total of SEK 215 million in the Offering, at a price of up to SEK 48 per share, corresponding to a market value of up to approximately SEK 544 million for the Company’s total outstanding shares prior to the Offering[1].

Strengths and competitive advantages

• Patent portfolio – The foundation for LumenRadio’s solutions and sales are its patented solutions for dealing with interference and creating reliable wireless solutions for business-critical applications.
• Hardware know-how – The Company’s know-how in the fields of radio technology and semiconductors has been a prerequisite for being able to develop radio modules offering good performance.
• Technology platform – Thanks to the software and the operating system that the Company has developed, it is possible for its customers to build their own IoT applications themselves, with the aid of LumenRadio’s software.
• Comprehensive offering – With an offering that includes both finished end-user products and a technology that can be integrated into a customer’s product, the LumenRadio can meet the customer where they are.
• Stable company – LumenRadio is a profitable growth company that is operating in a growing market driven by clear macrotrends.

A more comprehensive description of the Company’s strengths and competitive advantages will be included in the prospectus expected to be published by LumenRadio.

Financial target and dividend    

LumenRadio’s financial targets includes an average annual organic growth of at least 25 per cent over an economic cycle. In addition, LumenRadio targets an average EBITDA margin of at least 20 per cent on over an economic cycle. LumenRadio is in a growth phase and the Company’s Board of Directors intends to not propose any dividend in the short to medium-term. The cash flow generated by the Company is instead intended to be reinvested in growth, both organically and through strategic acquisitions.

Advisors

Skandinaviska Enskilda Banken AB (”SEB”) is acting as Sole Global Coordinator and Bookrunner in connection with the Offering. Advokatfirman Vinge KB is acting as legal advisor to LumenRadio, and Advokatfirman Cederquist KB is acting as legal advisor to SEB. In connection with the Offering, SEB and Avanza Bank AB (publ) are acting as Retail Distributors.             

For more information, please contact:

Alexander Hellström, CEO          
Phone: +46 (0)70 377 24 15       
Email: alexander.hellstrom@lumenradio.com

Susanne Gerdin, Communications & Marketing Director
Phone: +46(0)70 723 09 30
Email:susanne.gerdin@lumenradio.com

About LumenRadio

LumenRadio is a Swedish technology company offering reliable wireless product-to-product connections for business-critical IoT applications. Our scalable solutions build on patented wireless technology for lighting control, building automation and industrial communication. We have a zero vision when it comes to cables, and offer our customers a wireless alternative that works as well as the traditional cable – or better. With headquarter in Gothenburg, Sweden, and sales offices in Germany and US, our around 60 passionate employees deliver every day – Wireless Without Worries.

Important information

This announcement is not and does not form a part of any offer or invitation to acquire or subscribe for any securities in LumenRadio.

This announcement is not issued to and may not be distributed or sent into the United States, Australia, Canada, Japan or any other jurisdiction in which such distribution would be unlawful or would require registration or any other measures. This announcement does not constitute an offer for sale or purchase of securities in the United States. 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 from time to time (the “Securities Act”), and accordingly may not be offered or sold in the United States absent registration or an 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 offering in the United States or to conduct a public offering of securities in the United States.

The securities described herein have also not been and will not be registered under the applicable securities laws of the United States, Australia, Canada or Japan and, subject to certain exemptions, may not be offered or sold in or into or for the account or benefit of any person having a registered address in, or located or resident in the United States, Australia, Canada or Japan. There will be no public offering of the securities described herein in the United States, Australia, Canada or Japan.

Any offering of the securities referred to in this announcement will be made by means of a prospectus. This announcement is not a prospectus for the purposes of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (together with any related implementing and delegated regulations) and, with respect to the United Kingdom, the regulation implemented as domestic law in the United Kingdom through the European Union (Withdrawal) Act 2018 (the “Prospectus Regulation”). Investors should not invest in any securities referred to in this announcement except on the basis of information contained in the aforementioned prospectus.

In any EEA Member State other than Sweden and the United Kingdom, this communication is only addressed to and is only directed at qualified investors in that Member State and the United Kingdom within the meaning of the Prospectus Regulation (as applicable), i.e., only to investors who can receive any offering without an approved prospectus in such EEA Member State or the United Kingdom.

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 from time to time (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 in (i) and (ii) above together being referred to as “Relevant Persons”). The shares are only available for, and any invitation or offer or agreement to subscribe, acquire or in any other way obtain such securities is only available to Relevant Persons. This communication must not be acted on or relied on by persons who are not 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,” “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 believes 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 its control. 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 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 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.

In connection with the offer or sale of securities referred to herein, SEB may over-allot securities/conduct stabilization or effect transactions with a view to supporting the market price of the securities at a level higher than that which might otherwise prevail. Any stabilization action or over-allotment will be conducted by SEB and/or its subsidiary in accordance with all applicable laws and rules.