Glaston Corporation Stock Exchange Release 1
April 2019 at 15.30 EET
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documents to be completed or registered or require any measure to be undertaken,
in addition to the requirements under Finnish law. For further information, see
“Important notice” below.
Glaston Corporation (“Glaston” or the “Company”) has today completed the
acquisition of Swiss-German based globally operating high-end machinery, systems
and services provider for the processing of glass, Bystronic Maschinen AG and
Bystronic Lenhardt GmbH and their subsidiaries (“Bystronic glass”) for an
enterprise value of EUR 68 million. The acquisition supports Glaston’s ambition
to further strengthen its position in the glass processing value chain, adding
offering in insulation for the architectural market as well as pre-processing
for the automotive and display market. The acquisition was announced on 25
January 2019. The acquisition of a small Russian entity of Bystronic glass
(generating annual revenues of less than EUR 1 million) has not yet been
completed and is subject to the approval of the Russian competition authority
which is expected shortly.
“This acquisition is a major step in the execution of our strategy. It will
further strengthen our position in the glass processing value chain. As a result
of this transformational acquisition, Glaston will have a unique and value
adding offering benefitting its customers. We have fully complementary
offerings, growth potential from cross-selling new equipment and broadening our
services offering, as well as the ability to create further added value to our
customers through product development and best practice sharing. I warmly
welcome Bystronic glass’ employees to Glaston“, comments Arto Metsänen,
President and CEO of Glaston Corporation.
Changes to the Executive Management Group
In connection with the completion of the acquisition, Glaston will make the
following changes to the Executive Management Group. As of 1 April 2019, the
Executive Management Group will consist of CEO Arto Metsänen, COO and
integration lead Sasu Koivumäki, Burghard Schneider who will be responsible for
Bystronic glass, and as of 1 May 2019 Juha Liettyä who will be responsible for
Glaston technologies. Päivi Lindqvist continues in her position as CFO.
New long-term finance agreement and bridge financing
In connection with the acquisition, Glaston has signed a new long-term financing
agreement to be used for the purposes of financing the transaction, refinancing
of Glaston’s existing facilities as well as the group’s general working capital
and guarantee purposes. The package comprises of borrowings by Glaston under
senior secured credit facilities in an aggregate amount of EUR 75 million,
comprising of (i) a term loan amounting to EUR 40 million and (ii) a revolving
credit facility amounting to EUR 35 million, each with 3-year maturity from the
closing of the acquisition. The arrangers of the financing are Nordea Bank Abp
(“Nordea”) and OP Corporate Bank plc (“OP”). The financial covenants used in the
financing agreement are gearing (net debt/equity) and leverage (net
debt/EBITDA). The covenants will be monitored quarterly.
Furthermore, Nordea and OP have provided a bridge financing in an aggregate
amount of EUR 32 million with 6-month maturity from the closing of the
acquisition (the “Bridge Facility”) for the equity financing to be raised
through the rights issue of approximately EUR 32 million (“Rights Issue”).
Ahlstrom Capital B.V. has issued a guarantee for the liabilities of the Company
under the Bridge Facility on market terms. In addition, Ahlstrom Capital B.V.
has agreed to provide necessary financing to refinance the Bridge Facility, in
the event the Rights Issue would not be fully subscribed for.
Shareholder value and financial benefits
The combination of Glaston and Bystronic glass is expected to result in
significant benefits for stakeholders of the combined company, including
creation of significant shareholder value through synergies in services sales
and cross-selling new equipment and estimated annual cost synergies of
approximately EUR 4 million, mainly in cost of goods sold, sales & marketing and
administration, by year 2021. The transaction also provides additional synergy
potential relating to product development, procurement, fixed cost leverage and
best practice sharing. One-time costs and capital expenditure related to the
achievement of synergies are estimated at EUR 7–8 million over the same period,
and the majority of one-time costs is estimated to occur during the first year
of integration.
The acquisition is expected to be accretive to Glaston’s earnings per share
adjusted for transaction related one-time costs in 2019 and accretive to
earnings per share from 2020. As a consequence of the transaction, net debt of
the combined company will increase but remain moderate as the majority of the
transaction will be financed by equity.
Bystronic glass financial information
Bystronic glass will be consolidated as a part of Glaston Corporation as of 1
April 2019 and consequently Glaston will have two reporting segments: Glaston
and Bystronic glass. More detailed information on the impact of the acquisition
to Glaston’s financial information and consolidated accounts will be announced
during the second quarter of 2019. In addition, Glaston Corporation plans to
publish unaudited pro forma financial information at the latest in connection
with the planned Rights Issue, which is expected to be launched during the
second quarter of 2019.
Key figures
2018 EUR 2018 CHF 2017 EUR 2017 CHF 2016 EUR 2016 CHF
million million million million million million
Net sales 115.4 133.3 107.3 119.3 98.1 106.9
EBIT 6.6 7.6 5.7 6.3 0.9 1.0
EBIT% 5.9% 5.3% 0.9%
Comparable 6.6 7.6 5.7 6.3 4.2 4.6
EBIT*
Comparable 5.7% 5.3% 4.3%
EBIT%
Net 19.0 21.9 20.8 23.1 17.7 19.3
operating
assets**
Bystronic glass figures include Bystronic glass’ minor Brazil operations, which
is not included in the acquisition.
*Bystronic glass’ 2016 EBIT includes CHF 3.6 million (EUR 3.3 million) related
to restructuring costs in connection with cost-reduction measures in Europe and
global process optimization that are, based on management’s preliminary
assessment, considered to be outside ordinary course of business and which are
considered as adjusting items in accordance with Glaston’s principles.
**Net operating assets include the operating current and fixed assets (not
including cash, cash equivalents and securities, non-operating financial assets
and deferred tax assets) less operating liabilities (not including financial
liabilities and deferred tax liabilities).
Basis of preparation
The selected financial information presented above is based on Bystronic glass’s
financial information consisting of segment information of Bystronic glass
included in the financial statements of Conzzeta AG for the financial years
2018, 2017 and 2016, prepared in accordance with Swiss GAAP FER. Bystronic
glass's financial information above and all other financial figures in CHF in
this release have been converted into EUR using the ECB EUR/CHF average January
-December 2018 exchange rate (1.15491), average January-December 2017 exchange
rate (1.11153) and January-December 2016 exchange rate (1.09018).
Helsinki 1 April 2019
Glaston Corporation
Board of Directors
For further information, please contact:
Arto Metsänen, President and CEO, tel. +358 10 500 6100
Päivi Lindqvist, CFO, tel. +358 10 500 500
Joséphine Mickwitz, VP, IR, Communications and marketing, tel. +358 10 500 5070
This is Glaston
Glaston is the glass processing industry’s innovative technology leader
supplying equipment, services and solutions to the architectural, automotive,
solar and appliance industries. The company also supports the development of
emerging technologies integrating intelligence to glass.
As of April 2019, Bystronic glass is part of Glaston Group. Together we are
committed to providing our clients with both the best know-how and the latest
technologies in glass processing, with the purpose of building a better tomorrow
through safer, smarter, and more energy efficient glass solutions. We operate
globally with manufacturing, services and sales offices in 12 countries.
Glaston’s shares (GLA1V) are listed on NASDAQ Helsinki Ltd.
Distribution: NASDAQ Helsinki Ltd, key media, www.glaston.net
IMPORTANT NOTICE
These materials are 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. Glaston does not
intend to register any part of the rights offering 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, Hong Kong, Japan, South Africa 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 the European Economic Area, with respect to any Member State, other than
Finland, that has implemented Directive 2003/71/EC or Directive 2010/73/EU
(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 communication 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
document or any of its contents.
This release does not constitute a prospectus as defined in the Prospectus
Directive 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. Glaston 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 Glaston, its
subsidiaries, its securities and the transaction, including the merits and risks
involved.
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 Glaston, Bystronic glass and
the transaction identify certain of these forward-looking statements. Other
forward-looking statements can be identified in the context in which the
statements are made. Forward-looking statements are set forth in a number of
places in this release, including wherever this release include information on
the future results, plans and expectations with regard to the combined company’s
business, including its strategic plans and plans on growth and profitability,
and the general economic conditions. 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. Shareholders should not rely on these forward-looking
statements. Numerous factors may cause the actual results of operations or
financial condition of the combined company to differ materially from those
expressed or implied in the forward-looking statements. Glaston 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.
This release includes estimates relating to the synergy benefits expected to
arise from the transaction and the combination of the business operations of
Glaston and Bystronic glass as well as the related integration costs, which have
been prepared by Glaston and are based on a number of assumptions and judgments.
Such estimates present the expected future impact of the transaction and the
combination of the business operations of Glaston and Bystronic glass on the
combined company’s business, financial condition and results of operations. The
assumptions relating to the estimated synergy benefits and related integration
costs are inherently uncertain and are subject to a wide variety of significant
business, economic, and competitive risks and uncertainties that could cause the
actual synergy benefits from the transaction and the combination of the business
operations of Glaston and Bystronic glass, if any, and related integration costs
to differ materially from the estimates in this release.