REC proposes separation of REC Silicon and REC Solar
(Thomson Reuters ONE) -
Sandvika, Norway - July 18, 2013: REC (Renewable Energy Corporation ASA), a
leading global provider of solar electricity solutions, announces that it
proposes to separate its silicon and solar businesses.
* REC will establish REC Solar as an independent listed company
* REC will offer all shares in REC Solar to REC shareholders
* An offering of the shares in REC Solar, valued at NOK 800 million, has been
underwritten by the largest shareholders of REC
* All REC ASA shareholders will receive non-tradable subscription rights in
REC Solar
* Shareholders are also invited to join the guarantee consortium
* Both companies will improve their financing, with REC Solar being
established as a debt-free leading provider of solar panels and solutions
The transaction
The Board of Renewable Energy Corporation ASA (REC) has decided to call for an
Extraordinary General Meeting (EGM) to consider a separation of REC Solar from
REC. It will be proposed that REC shareholders are offered to purchase the
shares of REC Solar in an oversubscribed and fully underwritten offering (the
"Offering"), valuing the equity of REC Solar at NOK 800 million. REC Solar will
seek listing on the Oslo Stock Exchange.
All shareholders in REC as of the date of the EGM will receive non-tradable
subscription rights to their portion of the shares of REC Solar. They will thus
be able to maintain the same ownership stake in REC Solar as they currently hold
in REC. Oversubscription will not be possible, but a syndicate established by
some of REC's largest shareholders guarantees subscription for any shares in REC
Solar not subscribed in the Offering. Companies controlled by or parties related
to Jens Ulltveit Moe (44 percent), QVT (20 percent), member of the REC board
Øystein Stray Spetalen (15 percent), Skagen (10 percent), Datum AS (7 percent)
and Holberg (4 percent) have committed to guarantee 100 percent of the offering
and will following sub-guarantee syndication be entitled to guarantee at least
75 percent of the full NOK 800 million placement.
25 percent of the underwriting guarantee will be offered as sub-underwriting to
all REC shareholders, who must register their commitments before the close of
business on July 22, 2013. Sub-underwriters will be required to underwrite at
least NOK 4 million each, and commitments may be reduced relative to their
shareholdings and otherwise on a pro rata basis if the guarantee syndicate is
oversubscribed.
A prospectus describing REC Solar is being prepared, and will be published prior
to the subscription period for the Offering, expected to commence towards the
end of September. REC shareholders will be notified of their subscription rights
in conjunction with the Offering. REC shareholders will receive the right to
subscribe for one new share in REC Solar for each 58 shares they hold in REC at
the EGM date and the subscription price will be NOK 20 per share.
The industrial rationale
Solar is an industry in strong growth and is becoming an increasingly
competitive source of energy. The industry is, however, immature, fragmented and
weakly capitalized, and ripe for significant consolidation. REC recognizes that
it is increasingly demanding to grow and maintain a leading position in a fully
vertically integrated business model. There are only limited operational
synergies between the Silicon and Solar divisions today.
The transaction will allow the two companies to follow separate consolidation
paths as industry leaders in their fields. It also ensures a fundamentally solid
financial base for both companies.
REC Solar
REC Solar is a leading provider of solar panels and solutions. It has a proven
track record of cost reduction and high product quality, and will continue to
invest in the implementation of new technology.
Figures released in the quarterly statement of REC today indicate that the
current spot price is above the Q2 2013 cash cost for REC Solar, with revenues
of NOK 1,070 million and an EBITDA of NOK 75 million. Cell efficiency has
increased steadily, solar panel costs continue to come down, and sales volumes
were up 24 percent from Q1 2013, with selling prices increasing six percent. The
company has a strong market position in Europe and Asia, and will be
headquartered in Singapore under CEO Øyvind Hasaas.
REC will provide REC Solar with a NOK 300 million net cash position, as of June
30, 2013. It will have an additional undrawn credit facility of NOK 200 million
from REC, to potentially be replaced by third party financing. With a pro forma
equity ratio of 67 percent, REC Solar will at the time of listing have a debt
free financial base. This will allow for growth and further investment in new
technology.
REC parent company
REC will after completion of the Offering continue its other current operation
in the polysilicon business. REC has an industry-leading cost position based on
proprietary technology for the production of granular polysilicon. It provides a
diversified product offering through electronic grade and float zone polysilicon
as well as silane gas.
REC will receive the net sales proceeds from the Offering and thus strengthen
its own balance sheet following completion of the transaction. Provided that the
Solar operation is held for sale or disposed of, REC expects in the third
quarter 2013 to report its Solar operations as discontinued operations and
recognize a loss of about NOK 1.3 billion. The amounts are preliminary and
subject to changes.
REC will post transaction have a pro forma nominal net debt of NOK 1.7 billion
and a pro forma equity ratio of 53 percent. REC currently has an undrawn bank
credit facility of NOK 400 million and a guarantee facility of NOK 400 million,
both maturing in April 2014. The transaction will require bondholder approval,
and bondholder meetings will be called as soon as it is practicable.
Timeline
* Sub-underwriting will be accepted from today to the end of business on July
22.
* A bondholder meeting will be called for in due course and is expected to be
held in August 2013.
* An EGM in REC will be called for in due course, and is expected to be held
in August 2013.
* Subscription rights are expected to be received by those who are REC
shareholders on record as of the EGM date.
* The subscription period is expected to run for two weeks and end in October
2013; with the first day of listing shortly after the completion of the
transaction.
The transaction will require approval by Singaporean authorities, and REC Solar
will need approval for listing by the Oslo Stock Exchange.
Actions to be taken by shareholders
Invitations to the EGM will be sent to all shareholders shortly. Shareholders
will also receive a prospectus for the proposed offering, and will be allocated
subscription rights following the EGM. REC shareholders do not need to act prior
to the subscription period for the Offering in September-October in order to use
these subscription rights.
The right to participate in the Offering and sub-underwriting consortium will be
subject to customary selling and transfer restrictions.
Arctic Securities is acting as sole adviser and manager of the offering.
Shareholders in REC who wish to participate in the sub-underwriting should
contact Arctic Securities by telephone (+47 21 01 31 52 / + 47 21 01 30 00) to
be given a copy of the documentation available to underwriters, including a term
sheet. Underwriting will commence immediately, and be accepted until 16:30 CET
on July 22.
Further information
Further information about the transaction and its financial consequences are
available in an investor presentation attached to this press release and at
www.recgroup.com/offering2013.
For additional information, please contact:
Kjell Christian Bjørnsen
EVP & CFO, REC
Telephone: + 47 917 02 097
Email: kjell.bjornsen(at)recgroup.com
Mikkel Tørud,
SVP Investor Relations & Business Development, REC
Telephone: +47 976 99 144
Email: mikkel.torud(at)recgroup.com
Important notice:
This announcement is not an offer for sale of securities in the United States or
any other country in which such offer would be unlawful or would require
prospectus, registration or other measures. The securities referred to herein
have not been registered under the United States Securities Act of 1933, as
amended (the "U.S. Securities Act"), and may not be sold in the United States
absent registration or pursuant to an exemption from registration under the U.S.
Securities Act. REC does not intend to register any portion of the offering of
the securities in the United States or to conduct a public offering of the
securities in the United States. Copies of this announcement are not being made
and may not be distributed or sent into the United States, Canada, Australia,
Hong Kong, Japan or any other jurisdiction in which such distribution would be
unlawful or would require registration or other measures.
In any EEA Member State that has implemented Directive 2003/71/EC (together with
any applicable implementing measures in any member State, 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.
This announcement is only directed at (a) persons who are outside the United
Kingdom; or (b) investment professionals within the meaning of Article 19(5) of
the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005
(the "Order"); or (c) persons falling within Article 49(2)(a) to (d) ("high net
worth companies, unincorporated associations, etc.") of the Order; or (d)
persons to whom any invitation or inducement to engage in investment activity
can be communicated in circumstances where Section 21(1) of the Financial
Services and Markets Act 2000 does not apply.
Certain statements included within this announcement and its appendix contain
forward-looking information, including, without limitation, those relating to
(a) forecasts, projections and estimates, (b) statements of management's plans,
objectives and strategies for REC, such as planned expansions, investments or
other projects, (c) costs, capacities or rates, start-up costs, cost reductions
and profit objectives, (d) various expectations about future developments in
REC's markets, particularly prices, supply and demand and competition, (e)
results of operations, (f) margins, (g) growth rates, (h) risk management, as
well as (i) statements preceded by "expected", "scheduled", "targeted",
"planned", "proposed", "intended" or similar statements. Although we believe
that the expectations reflected in such forward-looking statements are
reasonable, these forward-looking statements are based on a number of
assumptions and forecasts that, by their nature, involve risk and uncertainty.
Various factors could cause our actual results to differ materially from those
projected in a forward-looking statement or affect the extent to which a
particular projection is realized. No assurance can be given that such
expectations will prove to have been correct. REC disclaims any obligation to
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
About REC
REC is a leading global provider of solar electricity solutions. With nearly two
decades of expertise, we offer sustainable, high-performing products, services
and investment opportunities for the solar and electronics industries. Together
with our partners, we create value by providing solutions that better meet the
world's growing electricity needs. Our 2,300 employees worldwide generated
revenues of more than NOK 7 billion in 2012, approximately EUR 1 billion or USD
1.3 billion.
To see more of what REC can offer, visit www.recgroup.com.
This information is subject of the disclosure requirements pursuant to section
5-12 of the Norwegian SecuritiesTrading Act.
REC Solar ASA investor presentation:
http://hugin.info/136555/R/1717217/570924.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Renewable Energy Corporation ASA via Thomson Reuters ONE
[HUG#1717217]
Unternehmensinformation / Kurzprofil:
Datum: 18.07.2013 - 06:56 Uhr
Sprache: Deutsch
News-ID 279488
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contact information:
Town:
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"REC proposes separation of REC Silicon and REC Solar"
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