MIPS announces its intention to list its shares on Nasdaq Stockholm

MIPS announces its intention to list its shares on Nasdaq Stockholm, publishes prospectus and announces the offer price for its initial public offering

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MIPS AB (publ) (”MIPS” or the ”Company”) today announces its intention to list its shares on Nasdaq Stockholm, publishes its prospectus and announces the price for the initial public offering (the ”Offer”). MIPS is a Swedish company which specialises in helmet safety and brain protection. The price is set at SEK 46 per share and Swedbank Robur Fonder, Third Swedish National Pension Fund, Handelsbanken Fonder, C Worldwide Asset Management, Lannebo Fonder and LMK Venture Partners (together the ”Cornerstone Investors”) have undertaken to, subject to certain conditions, acquire approximately 29.6 percent of the total number of shares in the Company following the Offer, corresponding to 52.6 percent of the total number of shares in the Offer, assuming that the over-allotment option is fully exercised.

The Offer in brief

•  The Offer is directed to the general public in Sweden and to institutional investors in Sweden and abroad.
•  The price per share in the Offer is set at SEK 46, corresponding to a value of the total number of shares in the Company before the Offer of MSEK 1,014 and MSEK 1,164 following the Offer.
•  The Offer comprises 12,399,372 shares, of which 9,138,502 shares are existing shares, corresponding to a value of MSEK 420, offered by BTA, HealthCap V L.P., KTH-Chalmers Capital KB and ALMI Invest Stockholm AB (the “Main Shareholders”) and other minority shareholders (together the “Selling Shareholders”[1]), and 3,260,870 are newly issued shares, corresponding to gross proceeds for the Company of approximately MSEK 150. The Offer represents approximately 49 per cent of the total number of shares in the Company following the Offer.
•  In order to cover any over-allotment in the Offer, the Main Shareholders have undertaken to sell an additional 1,859,905 existing shares in the Company (the “Over-allotment option”), upon request from ABG Sundal Collier and Handelsbanken Capital Markets (the “Joint Global Coordinators”)
•  The total value of the Offer amounts to approximately MSEK 570 and approximately MSEK 656 assuming that the Over-allotment option is fully exercised
•  The outcome of the Offer is expected to be announced by way of a press release on or around 23 March 2017
•  The Cornerstone investors have undertaken, subject to certain conditions, to acquire together in total 7,500,000 shares in the Offer, corresponding to approximately 29.6 percent of the total number of shares in the Company following the Offer and to 52.6 percent of the number of shares in the Offer assuming that the Over-allotment option is fully exercised
•  The first day of trading on Nasdaq Stockholm is expected to be on 23 March 2017 and settlement is expected to take place on 27 March 2017

Johan Thiel, CEO of MIPS:
”MIPS has during my time in the Company transformed into a successful ingredient brand company offering the MIPS BPS to leading helmet brands around the world. In 2016, we estimate to have penetrated nearly 4 percent of our current focus market of over 43 million helmets, with approximately 1.7 million units sold. As we move forward, our focus will be to continue growing with current customers through increased penetration of their helmet ranges as well as attracting new customers in current and new helmet categories. With the listing of MIPS’ shares we hope to gain new long-term owners who wish to join us on this journey and to raise further awareness of MIPS BPS and the risks associated with rotational motion.”

Bengt Baron, Chairman of the Board of MIPS:
”Since joining the board of MIPS in 2011, I have seen MIPS grow its unit sales from 14,000 units to nearly 1.7 million units in 2016. Last year 45 helmet brands purchased the MIPS BPS system for implementation in more than 210 helmet models. During the last few years we have spent significant efforts in raising awareness of the risks associated with rotational motion and in marketing the MIPS BPS to leading helmet brands. For our continued journey it is the board’s view that a listing of MIPS’ shares on Nasdaq Stockholm will strengthen the Company’s ability to attract customers and helmet brands, end-users and investors as well as raise awareness of rotational motion in general and of MIPS’ concept in particular.”

Terry Lee, Executive Chairman of Bell Technology Acquisition, LLC (BTA), the Principal Owner in MIPS:
"In 2014, BRG Sports[2]  made an initial investment in MIPS given its ownership of the Bell and Giro brands, which held the number one position in cycling and snow helmets. This industry leadership and expertise in head protection positioned BRG as an ideal partner for MIPS. Since BRG became a shareholder in MIPS, MIPS has taken significant strides in commercializing and extending their customer base. Last year BRG sold the Bell and Giro brands as part of its ongoing portfolio rationalization; however, we made an additional investment in MIPS as a further indication of our belief in MIPS and its technology. Now that MIPS has a solid foundation and has become an important partner with many helmet brands, it is the view of BRG that MIPS should operate as an independent company without significant influence by one shareholder in the industry.”

About MIPS
MIPS is a Swedish company which specialises in helmet safety and brain protection. MIPS offers its MIPS Brain Protection System (BPS), which is based on patent protected solutions, marketed under the ingredient brand MIPS on the global market for helmet solutions protecting against rotational motion transferred to the brain from angled impacts to the head. MIPS considers itself to be a leader in this market. The MIPS BPS is designed to add protection in helmets against rotational motion. The main component of the MIPS BPS is the MIPS low friction layer, which enables a relative movement between the head and the helmet, mimicking the brain’s own protection system. MIPS’ technology platform is based on more than 20 years of research and development in collaboration with the Royal Institute of Technology (KTH) and the Karolinska Institute. The MIPS BPS is easily implemented into new and existing helmet models, without affecting existing safety properties or design. Adopting the Company’s technology and the ingredient brand MIPS enables helmet brands to offer value-added, differentiated products with premium pricing. Helmets with the MIPS BPS have so far been sold within the helmet categories bicycle, snow, moto and equestrian. The Company estimates the combined annual volume of the consumer and professional helmet markets to exceed 70 million helmets.

During 2016, 45 helmet brands purchased the MIPS BPS, including brands such as Bell, Fox Head, Giro, Scott, Smith and Trek, to 212 helmet models. Between 2011–2016, MIPS delivered more than three million MIPS BPS units, mainly within the helmet categories bicycle and snow.

Background and reasons for the Offer
The board of directors of MIPS believes that now is a suitable time to strengthen MIPS’ profile through a listing of the Company’s shares on Nasdaq Stockholm. The Company believes that doing so will further increase the recognition and awareness of not only the Company, but its operations and its brands. It also believes that it will strengthen the Company’s ability to attract customers and helmet brands, end-users and investors.

Before the Offer, BTA holds 49 percent of the shares in the Company and is now looking to divest 5,399,500 shares, together with the other Selling Shareholders a total of 9,138,502 shares, in the Offer, in order to create a meaningful free float in the Company’s shares. If the Over-allotment option is fully exercised BTA will sell an additional 1,221,277 shares, together with the other Main Shareholders a total of 1,859,905 shares. MIPS seeks to raise approximately MSEK 150 in primary proceeds as part of the Offer. MIPS believes this will provide a strong financial position that will ensure that the Company has the flexibility to continue to invest in marketing, research and development as well as to, if and when deemed of benefit to the overall business, acquire complementary technologies and intellectual property. The Offer will broaden MIPS’ ownership and give MIPS access to the Swedish and international capital markets. A listing on Nasdaq Stockholm also provides additional evidence of the Company’s operational standards and integrity, which is deemed as positive for current and future business relations.

The Offer
The Offer is made to the general public in Sweden as well as to institutional investors in Sweden and abroad. The Offer comprises 3,260,870 new shares in the Company corresponding to gross issue proceeds for the Company of approximately MSEK 150 before costs related to the Offer. Furthermore, the Selling Shareholders have decided to offer the general public in Sweden as well as institutional investors in Sweden and abroad to acquire 9,138,502 existing shares in the Company. The Offer corresponds to approximately 49 per cent of the total number of shares and votes in the Company upon completion of the Offer, if the Offer is fully subscribed. The Offer price is set at SEK 46 per share. The outcome of the Offer is expected to be announced by way of a press release on or around 23 March 2017.

In order to cover any Over-allotment in the Offer, the Main Shareholders have undertaken to sell an additional 1,859,905 existing shares in the Company, upon request from the Joint Global Coordinators. If the Over-allotment option is fully utilised and the Offer is fully subscribed, the Offer will comprise 14,259,277 shares in MIPS, corresponding to approximately 56 percent of the total number of shares in the Company following completion of the Offer.

The total value of the Offer amounts to approximately MSEK 570 and approximately MSEK 656 assuming the Over-allotment option is fully exercised. Based on the Offer price, the market value of all shares in MIPS is approximately MSEK 1,164 following the Offer.

Cornerstone investors
The Cornerstone Investors have undertaken, subject to certain conditions, to acquire 7,500,000 shares in the Offer corresponding to approximately 29.6 percent of the total number of shares in the Company following the Offer and 52.6 percent of the shares in the Offer assuming that the Over-allotment option is exercised in full.

* Based on full subscription in the Offer and that the Over-allotment option is exercised in full.

Prospectus and preliminary timetable
A prospectus with full terms and conditions and application forms will be published today 13 March 2017, and will be available on MIPS’ website (www.mipscorp.com), ABG Sundal Collier’s website under on-going offerings (www.abgsc.com) and on Handelsbanken’s website under investment offerings (www.handelsbanken.se/investeringserbjudande). Applications can also be made via Avanza (www.avanza.se) and Nordnet (www.nordnet.se).

•  The application period for the general public in Sweden starts on 14 March 2017 and is expected to close on 21 March 2017
•  The book-building period for institutional investors starts on 14 March 2017 and is expected to close on 22 March 2017
•  The outcome of the Offer is expected to be announced on 23 March 2017
•  Trading in MIPS shares on Nasdaq Stockholm is expected to begin on 23 March 2017 and settlement is expected to take place on 27 March 2017
•  The shares will trade under the ticker “MIPS”.

Advisors
ABG Sundal Collier and Handelsbanken Capital Markets are Joint Global Coordinators and Joint Bookrunners. Advokatfirman Cederquist is legal advisor to the Company and Advokatfirman Hammarskiöld & Co is legal advisor to the Joint Global Coordinators and Joint Bookrunners.

For further information, please contact:
Boel Sundvall, Head of Investor Relations at MIPS
Telephone: +46 705 60 60 18
E-mail: boel.sundvall@mipsprotection.com

About Swedbank Robur Fonder
Robur is one of Scandinavia’s largest mutual fund managers and a wholly owned subsidiary of Swedbank. Robur offers savings products for private individuals and institutional clients through investment funds and discretionary investment management.

About Third Swedish National Pension Fund
Third Swedish National Pension Fund is one of five funds that manage capital on behalf of the Swedish state pension system. The Fund had SEK 324.4 billion of assets under management as at 31 December 2016. AP3 is tasked by Parliament with generating maximum possible benefit for the pension system by managing its fund capital in order to deliver strong investment returns at a low level of risk.

About Handelsbanken Fonder
Handelsbanken Fonder is a wholly owned subsidiary of Svenska Handelsbanken and is a significant fund manager in Scandinavia. Handelsbanken Fonder offers funds that are targeted towards private individuals as well as institutional clients.

About C Worldwide Asset Management
C WorldWide Asset Management (former Carnegie Asset Management) offers independent, world-class asset management capabilities for institutional clients, as well as a few selected external distribution channels. Clients of C WorldWide Asset Management have since 1986 achieved some of the world's best investment results at overall risk levels in line with market.

About Lannebo Fonder
Lannebo Fonder is an independent active Swedish fund manager which manages 16 different UCITS and alternative investment funds, predominately focused on Swedish and Nordic equities.

About LMK Venture Partners
LMK Venture Partners is a company within the LMK Group (Lars Mikael Karlsson), a Nordic privately owned investment company with investments in several companies, including Hotel Kungsträdgården, Lapland Resorts and Axis Communications (divested in 2015). The basis of LMK Group’s financial assets originates from Axis Communications, where Mikael Karlsson was one of the co-founders alongside Martin Gren. LMK Group’s investments are focused on contributing to the creation of new successful Swedish companies.

IMPORTANT INFORMATION
This announcement is not and does not form a part of any offer for sale of securities in any jurisdiction in which such offer would be unlawful.

This announcement is not for release, publication or distribution, in whole or in part, directly or indirectly into the United States (including its territories and dependencies, any State of the United States and the District of Columbia), Australia, Canada, Japan or any other jurisdiction in which such distribution would be unlawful or would require registration or other measures. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdiction. 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, sold or transferred, directly or indirectly, within 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 and no public offering of the securities referred to in this announcement is being made in the United States.

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 Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the “Prospectus Directive”). 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 that has implemented the Prospectus Directive, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive, i.e., only to investors who can receive the offer without an approved prospectus in such EEA 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 to 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,” “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.

[1] The Main Shareholders and 15 additional shareholders in the Company
[2] The shares in MIPS were transferred from BRG Sports, Inc. to BTA through an intra-group transfer on 28 February 2017

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