Norse Atlantic ASA: Fully covered contemplated private placement
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, HONG KONG, JAPAN, SOUTH AFRICA OR THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER OF ANY OF THE SECURITIES DESCRIBED HEREIN.
Arendal, 3 November 2023: Norse Atlantic ASA ("Norse" or the "Company") hereby announces a contemplated private placement of the NOK equivalent of approx. USD 45 million (equal to approx. NOK 501 million) (the "Offer Size") by issue of new shares (the "Offer Shares") in the Company (the "Private Placement"). The subscription price per Offer Share in the Private Placement will be at a fixed price of NOK 11.00 (the "Offer Price"). The Company has received pre-commitments covering the entire Offer Size. In addition, the Company's board of directors (the "Board") may propose a Subsequent Offering (as defined below), see further details below, towards existing shareholders not participating in the Private Placement.
The Company has appointed Pareto Securities AS and SpareBank 1 Markets AS as joint global coordinators and joint bookrunners in the Private Placement (together the "Managers").
The net proceeds to the Company from the Private Placement will be used to improve the liquidity through the shoulder and winter season, until such time as the revenue generated from the seasonally stronger summer program bookings are collected, as well as for general corporate purposes.
The Offer Price has been determined by the Board in discussions with the Managers following a pre-sounding of the Private Placement with selected wall-crossed existing and new investors.
The application period for the Private Placement will commence on 3 November 2023 at 09:00 CET, and is expected to close on 3 November 2023 at 16:30 CET. The Company may, at its sole discretion, extend or shorten the application period at any time and for any reason without notice. If the application period is extended or shortened, the other dates referred to herein might be changed accordingly. Subject to successful completion of the application period, the Company will announce the final number of Offer Shares placed in a stock exchange notice expected to be published following close of trading hours on Euronext Expand Oslo today, 3 November 2023. Thereafter, on or about 6 November 2023, the Board will call for an extraordinary general meeting to be held on or about 27 November 2023 (the "EGM") for the purposes of inter alia resolving to issue the Offer Shares in Tranche 2 (as defined below) and, if applicable, to authorize the Board to issue new shares in the contemplated Subsequent Offering (as defined below).
Scorpio Holdings Limited (“Scorpio”) (the largest shareholder in the Company with approx. 20.5% of the shares outstanding) and B T Larsen & Co Limited (“B T Larsen”) (the second largest shareholder in the Company with approx. 19.9% of the shares outstanding) have pre-committed to subscribe for NOK 150 million each (NOK 300 million in sum) in the Private Placement. In the case of applications from other existing shareholders and/or strong demand in general, B T Larsen's allocation may be scaled back to its respective pro-rata portion of the Private Placement based on its existing shareholding in the Company. Moreover, Scorpio has accepted an invitation to be represented on the Company’s board of directors, and is expected to assume one board seat. Additionally, it is expected that there would be one additional independent board seat such that the Company’s board of directors will comprise a total of five directors. Certain other existing shareholders and new investors have collectively pre-committed to subscribe for more than NOK 200 million in the Private Placement. Accordingly, the Managers have, during the pre-sounding phase of the Private Placement, received pre-commitments which in aggregate cover the full offer Size.
Allocation of Offer Shares, conditional in respect of Tranche 2 (as defined below) will be determined at the end of the application period by the Board, at its sole discretion, in consultation with the Managers. The Board will focus on, but is not limited to, allocation criteria such as pre-commitments, indications from the wall-crossing phase of the Private Placement, current ownership in the Company, timeliness of the application, relative order size, sector knowledge, perceived investor quality and investment horizon. The allocation will observe applicable rules of ownership restrictions under Regulation (EC) No 1008/2008 and provisions to that effect as stipulated in the articles of association of the Company. Notification of allotment and payment instructions are expected to be issued to the applicants on or about 6 November 2023 through a notification to be issued by the Managers.
The Private Placement will be directed towards selected Norwegian and international investors, subject to applicable exemptions from relevant registration, filing and prospectus requirements, and subject to other applicable selling restrictions. The minimum application and allocation amount has been set to the NOK equivalent of EUR 100,000 per investor. However, the Company may, at its sole discretion, allocate an amount below the NOK equivalent of EUR 100,000 to the extent permitted by applicable exemptions from the prospectus requirements pursuant to the Norwegian Securities Trading Act (the "STA") and ancillary regulations. Further selling restrictions and transaction terms will apply.
In connection with the Private Placement, 6-month lock-ups have been agreed for the Company's management and the Board, subject to customary exemptions. The Company's shareholders B T Larsen and Scorpio have also agreed to a 6-month lock-up period in connection with the Private Placement, subject to customary exemptions.
Settlement and conditions
The Private Placement will be divided in two tranches: A first tranche consisting of up to 9,978,161 Offer Shares ("Tranche 1"), which equals the maximum number of shares the Board may issue pursuant to the authorization granted by the annual general meeting in the Company on 15 June 2023 (the "Board Authorization"), and a second tranche with a number of Offer Shares that corresponds to a total transaction (i.e. both tranches) equal to the Offer Size ("Tranche 2"), to be issued by the EGM.
B T Larsen and Scorpio will receive their entire allocation of Offer Shares in Tranche 2. Allocations of Offer Shares to other applicants are expected to be split between Tranche 1 and Tranche 2 on a pro rata basis.
Settlement of Offer Shares in Tranche 1 is expected to take place on or about 8 November 2023, and settlement of Offer Shares in Tranche 2 is expected to take place on or about 29 November 2023, subject to a resolution by the EGM. Delivery of the Offer Shares allocated in Tranche 1 of the Private Placement will, in order to facilitate delivery-versus-payment (“DVP”) settlement, be made by delivery of existing and unencumbered shares in the Company already admitted to trading on Euronext Expand Oslo, pursuant to a share lending agreement between B T Larsen, the Company and the Managers. Delivery of the Offer Shares allocated in Tranche 2 will, in order to facilitate DVP settlement, be made through a combination of: (i) delivery of existing and unencumbered shares in the Company already admitted to trading on Euronext Expand Oslo, pursuant to a share lending agreement between B T Larsen and Scorpio, the Company and the Managers and (ii) through a pre-payment agreement between the Company and the Managers (the "Pre-Payment Agreement”). The share loans will be settled with (i) new shares in the Company to be resolved issued by the Board pursuant to the Board Authorization (Tranche 1), and (ii) new shares in the Company to be issued following, and subject to, a resolution by the EGM (Tranche 2). The Offer Shares allocated to applicants in Tranche 1 will be tradable from notification of allocation, and the Offer Shares allocated to applicants (other than to B T Larsen and Scorpio, as further described below) in Tranche 2 will thus be tradeable subject to a resolution by the EGM to issue the Offer Shares in Tranche 2 and registration of the share capital increase pertaining to the Offer Shares in Tranche 2 by the Norwegian Register of Business Enterprises (the "NRBE"). A portion of the new shares to be redelivered and Offer Shares to be issued to B T Larsen and Scorpio in Tranche 2 will be issued on a separate ISIN and will not be tradable on Euronext Expand Oslo until a prospectus has been approved by the Financial Supervisory Authority of Norway and published by the Company.
The completion of Trance 1 is subject to (i) a resolution by the Board to issue the Offer Shares in Tranche 1 pursuant to the Board Authorization, and (ii) the share lending agreement for Tranche 1 being unmodified and in full force and effect. The completion of Tranche 2 is subject to (i) the completion of Tranche 1, (ii) a resolution by the EGM to issue the Offer Shares in Tranche 2, (iii) the Pre-Payment Agreement and the share lending agreement for Tranche 2 being unmodified and in full force and effect, and (iv) the share capital increase pertaining to the issuance of the Offer Shares in Tranche 2 being validly registered with the NRBE. Further to this, completion of both Tranche 1 and Tranche 2 in the Private Placement is subject to the Board resolving to consummate the Private Placement and allocate the Offer Shares. Completion of Tranche 1 is not conditional upon completion of Tranche 2. The settlement of Offer Shares under Tranche 1 will remain final and binding and cannot be revoked, cancelled or terminated by the respective applicants if Tranche 2 is not completed.
The Company reserves the right in its sole discretion to cancel the Private Placement as a whole (including Tranche 1), or just Tranche 2, if the relevant conditions are not fulfilled.
The Private Placement has been considered by the Board in light of the equal treatment obligations under the STA section 5-14, section 2.1 of the Oslo Rule Book II, and Oslo Børs' Circular no. 2/2014, and the Board is of the opinion that it is in compliance with these requirements and guidelines. The issuance of the Offer Shares is carried out as a private placement in order to improve the liquidity through the shoulder and winter season, until such time as the revenue generated from the seasonally stronger summer program bookings are collected, as well as for general corporate purposes. By structuring the equity raise as a private placement, the Company is able to efficiently raise the necessary capital for the abovementioned purposes. The Company has also conducted an investor pre-sounding process with existing and new investors to obtain the best possible terms for the Private Placement, including a market-based offer price. In addition, the Company has received pre-commitments from the pre-committing investors to reduce transaction risk. In order to limit the dilutive effect of the Private Placement and to facilitate equal treatment, the Board will consider to propose to carry out the Subsequent Offering directed towards shareholders who were not participating in the Private Placement (see details below). Finally, the Private Placement and ancillary corporate resolutions, including the issuance of the Tranche 2 Offer Shares, are subject to approval by the EGM, at which the Company's shareholders will be given an opportunity to express their opinion and vote over the related share capital increase. On the basis of the above, and an assessment of the current equity markets as advised by the Managers, the Company's need for funding, deal execution risk and available alternatives, the Board is of the opinion that the waiver of the preferential rights inherent in the Private Placement is in the common interest of the Company and its shareholders.
Subsequent offering
The Company may, subject to completion of the Private Placement, approval by the EGM and certain other conditions, resolve to carry out a subsequent offering of new shares in the Company at the Offer Price (the "Subsequent Offering"). Any such Subsequent Offering, if applicable and subject to applicable securities laws, will be directed towards existing shareholders in the Company as of 3 November 2023 (as registered in the VPS two trading days thereafter), who (i) were not included in the wall-crossing phase of the Private Placement, (ii) were not allocated Offer Shares in the Private Placement, and (iii) are not resident in a jurisdiction where such offering would be unlawful, or would (in jurisdictions other than Norway) require any prospectus, filing, registration or similar action.
Update on strategic review
Reference is further made to the Company's stock exchange announcement made on 31 October 2023, where it was announced that the Company will seek to engage advisers to explore and advise on strategic alternatives for the Company. The Company shall, no later than 10 November 2023, appoint, and announce the appointment of, an internationally recognized industry specialist advisors’ firm to explore and advise it on strategic alternatives.
Advisors
Wikborg Rein Advokatfirma AS acts as legal counsel to the Company, and Advokatfirmaet Wiersholm AS acts as legal counsel to the Managers in connection with the Private Placement.
For further information, please contact:
Investors: CFO, Anders Jomaas, Anders.Jomaas@flynorse.com
Media: SVP Communications, Philip Allport, philip.allport@flynorse.com
About Norse
Norse Atlantic Airways is an airline that offers affordable fares on long-haul flights, primarily between Europe and the United States. The company was founded by CEO and major shareholder Bjørn Tore Larsen in March 2021. Norse has a fleet of 15 modern, fuel-efficient and more environmentally friendly Boeing 787 Dreamliners that serve destinations including New York, Los Angeles, Orlando, Boston, Washington, Boston, Jamaica, Barbados, Bangkok, Miami, Oslo, London, Berlin, Rome and Paris. The company's first flight took off from Oslo to New York on June 14, 2022.
This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to the STA section 5-12.
This stock exchange release was published by Ben Boiling on the time and date provided.
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. None of the Managers or any of their respective affiliates or any of their respective directors, officers, employees, advisors 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. This announcement has been prepared by and is the sole responsibility of the Company.
Neither this announcement nor the information contained herein is for publication, distribution or release, in whole or in part, directly or indirectly, in or into or from the United States (including its territories and possessions, any State of the United States and the District of Columbia), Australia, Canada, Japan, Hong Kong, South Africa or any other jurisdiction where to do so would constitute a violation of the relevant laws of such jurisdiction. The publication, distribution or release of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
This announcement is not an offer for sale 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, and may not be offered or sold in the United States absent registration with the U.S. Securities and Exchange Commission or an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any securities referred to herein in the United States or to conduct a public offering of securities in the United States.
Any offering of the securities referred to in this announcement will be made by means of a set of subscription materials provided to potential investors. Investors should not subscribe for any securities referred to in this announcement except on the basis of information contained in the aforementioned subscription material. In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the EU Prospectus Regulation, i.e. only to investors who can receive the offer without an approved prospectus in such EEA Member State. The expression "EU Prospectus Regulation" means Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (together with any applicable implementing measures in any Member State).
This communication is only being distributed to and is only directed at persons in the United Kingdom that are "qualified investors" within the meaning of the EU Prospectus Regulation as it forms part of English law by virtue of the European Union (Withdrawal) Act 2018 and 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.
This announcement is made by, and is the responsibility of, the Company. The Managers and their respective affiliates are acting exclusively for the Company and no-one else in connection with the Private Placement. They will not regard any other person as their respective clients in relation to the Private Placement and will not be responsible to anyone other than the Company, for providing the protections afforded to their respective clients, nor for providing advice in relation to the Private Placement, the contents of this announcement or any transaction, arrangement or other matter referred to herein.
In connection with the Private Placement, the Managers and any of their respective affiliates, acting as investors for their own accounts, may subscribe for or 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 Private Placement or otherwise. Accordingly, references in any subscription materials to the shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, such Managers and any of their respective affiliates acting as investors for their own accounts. The Managers do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations 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", "aim", "expect", "anticipate", "intend", "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. Forward-looking statements speak only as of the date they are made and cannot be relied upon as a guide to future performance. The Company, each of the Managers and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any forward-looking statement contained in this announcement whether as a result of new information, future developments or otherwise. The information, opinions and forward-looking statements contained in this announcement speak only as at its date and are subject to change without notice.