SRV Group Plc commences directed share issue to holders of its capital notes and publishes prospectus

SRV GROUP PLC   STOCK EXCHANGE RELEASE     4 MAY 2020   AT 18.20 EET

SRV Group Plc commences directed share issue to holders of its capital notes and publishes prospectus

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR TO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.

SRV Group Plc ("SRV") announced on 6 February 2020 that it is planning a directed share issue and a rights issue to strengthen its balance sheet.

Based on an authorisation given by the Annual General Meeting on 26 March 2020, SRV's Board of Directors passed today, on 4 May 2020, a resolution on a directed share issue where SRV offers in deviation from the pre-emptive right of shareholders up to 87,644,557 new shares ("Offer Shares") to the holders of SRV's Capital Notes (as defined below) (the "Offering").

The Offering is part of SRV's recovery programme announced on 31 October 2019, and the purpose of the Offering is to improve SRV's balance sheet, liquidity and financial position.

The Offering in brief:

• In the Offering, SRV offers in deviation of the pre-emptive right of shareholders up to 87,644,557 Offer Shares to the holders of the hybrid notes issued by SRV on 22 March 2016 (ISIN code FI4000198114) and holders of the hybrid notes issued by SRV on 23 May 2019 (ISIN code FI4000384185) (together, the "Capital Notes").
• The Offering consists of a public offering of Offer Shares to private individuals and entities in Finland and of private placements in the European Economic Area and in certain other jurisdictions outside of the United States.
• The subscription price per each Offer Share is EUR 1.05.
• The subscription period for the Offering will commence on 5 May 2020 at 9.30 a.m. (Finnish time) and end on 15 May 2020 at 4.30 p.m. (Finnish time) (estimated).
• The subscription price shall be paid by way of setting off Capital Notes. Each holder of Capital Notes may pay the subscription price for Offer Shares by setting off such holder's receivables based on the Capital Notes in full or in part at their par value. Interest accrued up to 30 April 2020 on units of Capital Notes shall also be used for payment of the subscription price.
• Ilmarinen Mutual Pension Insurance Company, Pohjola Insurance Ltd and OP Life Assurance Company Ltd as well as Pontos Ltd have committed to SRV to subscribe for Offer Shares in the Offering with the Capital Notes for an aggregate amount of approximately EUR 51 million in principal amount of the Capital Notes, and together with the accrued interest, for an aggregate amount of approximately EUR 57 million. The subscription commitments have been given at a subscription price of EUR 1.05 per share. The subscription commitments cover approximately 54,473,565 Offer Shares in aggregate, which corresponds to approximately 62.2 per cent of the maximum number of Offer Shares.
• SRV aims to raise gross proceeds of up to EUR 92 million in the Offering, assuming that all of the holders of the Capital Notes subscribe for their full allocation. SRV will not receive any cash proceeds from the Offering as the subscription price shall be paid by way of setting off Capital Notes.
• The maximum number of Offer Shares offered in the Offering is 87,644,557, representing approximately 59.2 per cent of all the shares in SRV after the completion of the Offering (assuming all of the holders of the Capital Notes subscribe for their full allocation). Assuming that only the parties who have given a subscription commitment to subscribe for Offer Shares in the Offering, the number of Offer Shares offered in the Offering would amount to a total of 54,473,565 Offer Shares, representing approximately 48.7 per cent of all the shares in SRV after the completion of the Offering.
• Danske Bank A/S, Finland Branch, is acting as the lead manager of the Offering (the "Lead Manager").
• The terms and conditions of the Offering are attached to this release in the Finnish language.

SRV's CEO Saku Sipola comments:

"The directed share issue is part of our recovery programme launched towards the end of last year with focus on renewing the organisation and operating culture, bolstering financial position and performance level, and improving profitability. Recovery programme has progressed well, and most of the measures have been implemented. The directed share issue combined with the contemplated subsequent rights issue will strengthen our financial position, enabling us to respond to our customers' needs and to the challenges brought by urbanisation with an even stronger grip."

Reasons for the Offering

The Offering is part of SRV's recovery programme announced on 31 October 2019, and the purpose of the Offering is to improve SRV's balance sheet, liquidity and financial position. In addition to the Offering, SRV is contemplating a subsequent rights issue of up to EUR 50 million during the second quarter of 2020 to further strengthen its balance sheet.

Publication of the prospectus regarding the Offering

SRV has drawn up a prospectus regarding the Offering (the "Prospectus"), which the Finnish Financial Supervisory Authority has approved today, on 4 May 2020. The Prospectus will be made available in the Finnish language on SRV's website today, on 4 May 2020, at www.srv.fi/en/investors/ and at the registered office of SRV at Tarvonsalmenkatu 15, FI-02600 Espoo, Finland on or about 5 May 2020. In addition, the Prospectus will be available in the Finnish language on the Lead Manager's website at www.danskebank.fi/srv-en on or about 5 May 2020. An unofficial English-language translation of the Prospectus is expected to be available upon request from the Lead Manager from 4 May 2020.

Important dates

• The subscription period for the Offering will commence on 5 May 2020 9.30 a.m. (Finnish time).
• The subscription period for the Offering will end on 15 May 2020 at 4.30 p.m. (Finnish time) (estimated).
• The final results of the Offering will be announced on 15 May 2020 (estimated).
• The Offer Shares offered in the Offering will be registered in the book-entry accounts of the investors on 20 May 2020 (estimated).
• Trading in the Offer Shares will commence on the official list of Nasdaq Helsinki Ltd on 20 May 2020 (estimated).

Danske Bank A/S, Finland Branch acts as the Lead Manager of the Offering. Krogerus Attorneys Ltd acts as legal counsel to SRV. Roschier, Attorneys Ltd. acts as legal counsel to the Lead Manager.

For further information, please contact:
Saku Sipola, President & CEO, tel. +358 (0)40 551 5953, saku.sipola@srv.fi
Ilkka Pitkänen, CFO, tel. +358 (0)40 667 0906, ilkka.pitkanen@srv.fi

Distribution:
Nasdaq Helsinki
Main media
www.srv.fi

You can also find us on the social media:

Facebook   LinkedIn   Twitter   Instagram

SRV in brief

SRV is a bold developer and innovator in the construction industry. We want to offer the best customer experience as a constructor of urban city centres, while also being the most attractive employer in the industry. Our genuine cooperation and enthusiasm for our work comes across in every encounter. Sustainability is reflected in all our activities.

Established in 1987, we are a publicly listed company since 2007 in Helsinki Nasdaq stock exchange that operates in selected growth centres in Finland and Russia. Our revenue in 2019 was EUR 1,061 million. Over 1,000 people work for us and we employ a network of almost 4,000 subcontractors in our projects.

SRV - Building for life

IMPORTANT NOTICE

This release is not an offer for sale of securities in the United States. Securities may not be sold in the United States absent registration with the United States Securities and Exchange Commission or an exemption from registration under the U.S. Securities Act of 1933, as amended. SRV does not intend to register any part of the Offering of the subsequent rights issue in the United States or to conduct a public offering of securities in the United States.

The distribution of this release may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restrictions. The information contained herein is not for publication or distribution, directly or indirectly, in or into Australia, Canada, Japan or the United States. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. This release is not directed to, and is not intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction.

In any EEA Member State, other than Finland, and in the United Kingdom, this release is only addressed to and is only directed at qualified investors in that Member State or in the United Kingdom within the meaning of Regulation (EU) 2017/1129 (the "Prospectus Regulation").

This release is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (iii) high net worth companies, and other persons to whom it 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"). Any securities mentioned herein are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this release or any of its contents.

This release does not constitute a prospectus as defined in the Prospectus Regulation and as such, does not constitute or form part of and should not be construed as, an offer to sell, or the solicitation or invitation of any offer to buy, acquire or subscribe for, any securities or an inducement to enter into investment activity.

No part of this release, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. The information contained in this release has not been independently verified. No representation, warranty or undertaking, expressed or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. SRV or any of its respective affiliates, advisors or representatives or any other person, shall have no liability whatsoever (in negligence or otherwise) for any loss however arising from any use of this release or its contents or otherwise arising in connection with this release. Each person must rely on their own examination and analysis of SRV, its subsidiaries, its securities and the transactions, including the merits and risks involved.

The Lead Manager is acting exclusively for SRV and no one else in connection with the Offering. It will not regard any other person as its respective client in relation to the Offering. The Lead Manager will not be responsible to anyone other than SRV for providing the protections afforded to its respective clients nor for giving advice in relation to the Offering or any transaction or arrangement referred to herein.

This release includes "forward-looking statements." These statements may not be based on historical facts, but are statements about future expectations. When used in this release, the words "aims," "anticipates," "assumes," "believes," "could," "estimates," "expects," "intends," "may," "plans," "should," "will," "would" and similar expressions as they relate to SRV and the transactions identify certain of these forward-looking statements. Other forward-looking statements can be identified in the context in which the statements are made. These forward-looking statements are based on present plans, estimates, projections and expectations and are not guarantees of future performance. They are based on certain expectations, which, even though they seem to be reasonable at present, may turn out to be incorrect. Such forward-looking statements are based on assumptions and are subject to various risks and uncertainties. Readers should not rely on these forward-looking statements. Numerous factors may cause the actual results of operations or financial condition of SRV to differ materially from those expressed or implied in the forward-looking statements. SRV or any of its affiliates, advisors or representatives or any other person undertakes no obligation to review or confirm or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise after the date of this release.