DIAG – Signed letter of intent to acquire NEL Hydrogen AS
DIAG – Signed letter of intent to acquire NEL Hydrogen AS
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES
Oslo, 8 September 2014
Diagenic ASA (“Diagenic” or the “Company”, ticker “DIAG”) has entered into a non-binding letter of intent (“LOI”) with the shareholders of NEL Hydrogen AS (“NEL Hydrogen”) to acquire the shares of NEL Hydrogen for a total consideration of approximately NOK 120 million on an enterprise value basis (the “Acquisition”). NEL Hydrogen has limited net debt. The Acquisition will be financed through NOK 40 million in cash and the remainder in new shares of Diagenic. The consideration shares to be issued will be valued at NOK 0.65 per share. The proposed acquisition represents a change in strategic direction for Diagenic to include a new business area. The existing pharmaceutical activities of Diagenic will remain as a separate business area within the Company.
NEL Hydrogen is a global leader in the supply of hydrogen-based electrolyser plants and hydrogen fuelling stations. The company dates back to the 1920s when Norsk Hydro established its first hydrogen generation installation for use in ammonia fertilizer production. The company began commercial sales of electrolysers in the 1970s, and has sold more than 500 electrolysers in a wide array of industries across Europe, South America, Africa and Asia. The company has locations in Notodden, Norway and has a global reach through its own sales representatives and extensive agent network. For further information regarding NEL Hydrogen, please refer to the company’s webpage www.nel-hydrogen.com.
NEL Hydrogen is majority owned by employees and Strata Marine & Offshore AS and associated companies.
In order to secure growth capital for the new business area resulting from the Acquisition, the Board of Directors proposes to raise NOK 70 million through a i) NOK 35 million private placement (“Private Placement”); and ii) NOK 35 million rights issue (“Rights Issue”). The Private Placement and the Rights Issue are both fully underwritten by large existing shareholders on ordinary market terms. Underwriters include existing shareholders Strata Marine & Offshore AS, Storebrand, Alfred Berg, Tigerstaden AS, Alpine Capital, AS, Spar Kapital Investor AS, Håkon Sæther, Dallas Asset Management AS, Kristianro AS and AB Investment.
The subscription price per new share in the Private Placement and the Rights Issue will equal the issue price of the consideration shares to be issued to the NEL Hydrogen shareholders, i.e. NOK 0.65 per new share. The Rights Issue will be directed to the Company’s existing shareholders as of the date of the EGM (defined below). Transferable subscription rights will be issued and listed on the Oslo Stock Exchange. The subscription period in the Rights Issue has tentatively been set to the latter part of October 2014.
The proposed Acquisition is subject to satisfactory due diligence and the signing of a definite share purchase agreement, as well as shareholder approval at an Extraordinary General Meeting in Diagenic expected to be held in the first half of October 2014 (the "EGM"). The Acquisition is expected to be completed in mid-October 2014, given fulfilment of the abovementioned conditions. The proposed share issues are subject to approval of both transactions and the Acquisition by the EGM. A separate notice convening for the EGM will be sent out in due course.
Carnegie AS acts as financial advisor in connection with the Acquisition, the Private Placement and the Rights Issue.
For further information, please contact:
Lars Christian Stugaard
Acting CEO
+47 23 01 49 06
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.