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Smartoptics Group AS: Contemplated private placement and admission to trading on Euronext Growth Oslo
Oslo, 26 May 2021. Smartoptics Group AS (“Smartoptics” or the “Company”), a leading provider of optical networking solutions, announces today a contemplated private placement of up to approximately NOK 250 million in new and existing shares of the Company (the “Private Placement”) and a subsequent listing of the Company’s shares on Euronext Growth Oslo (the “Listing”).
The Private Placement
The price per Offer Share in the Private Placement has been set to NOK 10.38, equivalent to a pre-money equity value of the Company of approximately NOK 900 million based on the 86,686,593 shares outstanding in the Company (after collapse of the Company's current two share classes into one class of ordinary shares).
The Private Placement will consist of i) a primary offering of up to 9,600,000 new shares, raising gross proceeds to the Company of up to approximately NOK 100 million (the “Primary Offering”) (the “New Shares”) and ii) a secondary offering of up to 12,000,000 existing shares by a consortium of the largest shareholders in the Company, including certain board and management representatives (the “Sale Shares”). There will also be an over-allotment option of up to 2,400,000 shares, (equal to approximately 11% of the total number of New Shares and Sale Shares allocated in the Private Placement) (the “Additional Shares” and, together with the New Shares and the Sale Shares, the “Offer Shares”) to facilitate price stabilisation activities in a period of 30 days from the first day of Listing.
The net proceeds from the Primary Offering will be utilised to pursue organic growth initiatives, in addition to general corporate purposes.
Three cornerstone investors have, subject to certain conditions, undertaken to subscribe for and be allocated shares for approximately NOK 95 million at the Offer Price as follows; (i) Danske Invest for NOK 40 million), (ii) Ålandsbanken for NOK 35 million and (iii) Varner Invest for NOK 20 million.
CEO of Smartoptics Magnus Grenfeldt commented: “There is a tremendous growth in the market for data traffic, driven by video streaming, 5G, IoT and cloud services. This is driving a strong growth in demand for our products and services. Forecasts show 29 percent growth per year in global data traffic during the coming four years, and we are perfectly positioned in this market. Our technology, size and business culture mean that we can maneuver faster than the giants in the industry, and we are a preferred vendor for many small and mid-sized companies.”
In 2020, Smartoptics had operating revenues of USD 34.8 million (+31% Y/Y) with 6 percent EBITDA margin. The Q1 2021 growth was 52 percent.
“Our aspiration is to grow operating revenues to USD 100 million and increase our EBITDA margin to 15-18 percent by 2025/2026. A public listing and improved access to capital will be an important tool to achieve this, said Magnus Grenfeldt.
Timeline and application period
The application period in the Private Placement will commence today, 26 May 2021 at 09:00 CEST and close on 28 May 2021 at 16:30 CEST. The Manager and the Company may, however, at any time resolve to close or extend the application period. If the application period is shortened or extended, any other dates referred to herein may be amended accordingly.
Smarter Holding AS is expected to grant DNB Markets, as stabilisation manager, an option to acquire at the Offer Price a number of shares equal to the number of Additional Shares to cover short positions resulting from any over-allotments made. Such option must be exercised by the Manager no later than the 30th day following commencement of trading on Euronext Growth Oslo. The stabilisation manager may (but will be under no obligation to) effect stabilisation activities in accordance with Commission Delegated Regulation (EU) 2016/1052, as implemented into Norwegian law by Section 3-1 of the Norwegian Securities Trading Regulation, in a period of 30 days from the first day of trading on Euronext Growth Oslo in order to support the market price of the shares. However, stabilisation action may not necessarily occur and may cease at any time. Any stabilisation action may begin on or after the date of commencement of trading of the shares on Euronext Growth Oslo and, if begun, may be ended at any time, but it must end no later than 30 days after that date. Stabilisation may result in a price of the shares that is higher than might otherwise prevail, and the price may reach a level that cannot be maintained on a permanent basis.
The Company, Smarter Holding AS and members of the Company's board of directors and management will enter into customary lock-up arrangements with the Manager that will restrict, subject to certain exceptions, their ability to, without the prior written consent of the Manager, issue, sell or dispose of shares, as applicable, for a period of 12 months for the Company, 6 months for Smarter Holding AS and 12 months for members of the Company's board of directors and management, after the commencement of trading in the shares on Euronext Growth Oslo.
Smartoptics has applied for, and will, subject to successful completion of the Private Placement and the necessary approvals from the Oslo Stock Exchange, list the shares of the Company on Euronext Growth Oslo (the “Listing”). The first day of trading on Euronext Growth Oslo is expected to be shortly after completion of the Private Placement, and is currently expected to be no later than on or about 9 June 2021.
The Private Placement will be directed towards Norwegian and international investors, in each case subject to an exemption being available from prospectus requirements and any other filing or registration requirements in the applicable jurisdictions and subject to other selling restrictions. The minimum application and allocation amount have been set to the NOK equivalent of EUR 100,000. The Company may, however, at its sole discretion, allocate shares corresponding to an amount below EUR 100,000 to the extent applicable exemptions from the prospectus requirement pursuant to Regulation (EU) 2017/1129, the Norwegian Securities Trading Act and other applicable regulations are available.
Completion of the Private Placement is conditional upon (i) all necessary corporate resolutions for consummating the Private Placement being validly made by the Company and the selling shareholders, including without limitation relevant approvals and resolutions by the Board of Directors and the Company's general meeting, (ii) the allocated Offer Shares having been fully paid and (iii) the New Shares having been validly issued (by registration of the share capital increase pertaining to the issuance of the New Shares in the Norwegian Register of Business Enterprises) and delivered in the VPS.
The Company reserves the right, at any time and for any reason, to cancel, and/or modify the terms of, the Private Placement. Neither the Company nor the Manager will be liable for any losses incurred by applicants if the Private Placement is cancelled, irrespective of the reason for such cancellation.
Smartoptics in brief:
Smartoptics provides innovative optical networking solutions and devices for the new era of open networking. The Company’s customer base includes thousands of enterprises, governments, cloud providers, Internet exchanges as well as cable and telecom operators. Smartoptics has an open networking approach in everything it does which allows our customers to break unwanted vendor lock-in, remain flexible and minimize costs. The solutions are used in metro and regional network applications that increasingly rely on data center services and specifications.
Advisors:
DNB Markets, a part of DNB Bank ASA is acting as Sole Global Coordinator and Bookrunner in connection with the Private Placement (the “Manager”). Advokatfirmaet Schjødt AS is acting as legal advisor to the Company.
For more information, please contact:
Magnus Grenfeldt, CEO
+46 73-366 88 77
Important notice:
These materials do not constitute or form a part of any offer of securities for sale or a solicitation of an offer to purchase securities of the Company in the United States or any other jurisdiction. The securities of the Company may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"). The securities of the Company have not been, and will not be, registered under the U.S. Securities Act. Any sale in the United States of the securities mentioned in this communication will be made solely to "qualified institutional buyers" as defined in Rule 144A under the U.S. Securities Act. No public offering of the securities will be made in the United States.
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).
In the United Kingdom, this communication is only addressed to and is only directed at Qualified Investors who (i) are 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) are persons falling within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations, etc.) (all such persons together being referred to as "Relevant Persons"). These materials are directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this announcement 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 statement contains certain forward-looking statements (as such defined in Section 21E of the U.S. Securities Exchange Act of 1934, as amended) concerning future events, including possible issuance of equity securities of the Company. Forward-looking statements are statements that are not historical facts and may be identified by words such as "anticipate", "believe", "continue", "estimate", "expect", "intends", "may", "should", "will" 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, include, but are not limited to, the possibility that the Company will determine not to, or be unable to, issue any equity securities, and could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice.
This announcement is made by and, and is the responsibility of, the Company. The Managers are acting exclusively for the Company and no one else and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, or for advice in relation to the contents of this announcement or any of the matters referred to herein. Neither the Managers nor any of their respective affiliates makes any representation as to the accuracy or completeness of this announcement and none of them accepts any responsibility for the contents of this announcement or any matters referred to herein.
This announcement is for information purposes only. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. Neither the Managers nor any of their respective affiliates accepts any liability arising from the use of this announcement.
Each of the Company, the Managers and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any statement contained in this announcement whether as a result of new information, future developments or otherwise.
The Private Placement may be influenced by a range of circumstances, such as market conditions, and there is no guarantee that the Private Placement will proceed and that the Admission will occur.
Certain figures contained in this document, including financial information, may have been subject to rounding adjustments. Accordingly, in certain instances, the sum or percentage change of the numbers contained in this document may not conform exactly with the total figure given.
The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions. Specifically, 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, Hong Kong Japan 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 comes 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.