Nets details IPO Offering
13 September 2016 | 5121 views | 0
Nets, a leading provider of digital payment services and related technology solutions across the Nordic region, today has published an Offering Circular and the indicative price range in connection with its intended initial public offering (“IPO” or the “Offering”) and subsequent admission to trading in and official listing of its shares on Nasdaq Copenhagen.
* Indicative offer price range of DKK 130 to DKK 160 per share of nominal value DKK 1 each
* Implied market capitalisation of DKK 26 billion to DKK 32 billion after the issuance of new shares in the Offering.
* The Offering comprises: up to 42,307,693 new shares to be issued by the Company, which would generate gross proceeds of approximately DKK 5.5 billion; a partial sell-down of 37,692,307 to 70,625,000 existing shares by Nets’ current shareholders, excluding any shares subject to the overallotment option; an overallotment option of up to 15,750,000 shares has been granted to the managers by certain of Nets’ current shareholders
* The Offering is expected to result in a free float between 40% and 60% of Nets A/S share capital after completion of the Offering * Offer period from 13 September 2016 to 26 September at 11 a.m. CET, but may be closed in whole or in part at the earliest on 22 September 2016 at 00:01 a.m. CET
* Offer price to be announced and first day of admission and trading on Nasdaq Copenhagen on 27 September 2016 unless moved forward if the offer period is closed before 26 September 2016
The intended IPO of Nets marks the next stage in the Company’s development, following a period of transformation and building on the platform of the previous owners. Over the past two years, Nets has been repositioned through a combination of operational improvements and over DKK 3.9 billion of investment in IT, existing and new products, and seven strategic acquisitions, transforming Nets into a growth business. Nets sits at the centre of the Nordics digital payments ecosystem and operates a deeply entrenched network that connects merchants, corporate customers, financial institutions and consumers. Its innovative and highly scalable platform, robust financial profile and multiple drivers for future growth all put Nets in a strong position to deliver long-term sustainable value for its current and prospective shareholders.
The Offering is expected to support Nets’ operational strategy, advance the Company’s public and commercial profile, and provide it with improved access to public capital markets and a diversified base of new Danish and international shareholders. Nets plans to use the proceeds it receives from the Offering, together with amounts drawn under a new banking facilities agreement to be put in place subject to the IPO and potentially also existing cash, to repay existing debt in the Nets group.
Bo Nilsson, CEO of Nets, said:
“I am delighted with the response we have received to the announcement of our intention to float, both from potential investors and other stakeholders. There is clearly a real appreciation of the transformation Nets has undergone in the past two years, with the Company emerging as a highly commercial, customer-centric, innovative leader in the fast-growing digital payments space. There is also an understanding of the well-diversified position Nets has built at the heart of the Nordics payments ecosystem over many years, providing us with a number of exciting opportunities for future growth within the world’s most digitised societies. I am proud of what everyone at Nets has achieved, and we look forward to building on our track record of success, continuing to deliver more new products and services for our customers and value for our shareholders.”
Details of the Offering
The Offering comprises between 34,375,000 and 42,307,693 new shares to be issued by the Company, such as would result in gross proceeds of approximately DKK 5.5 billion, and a partial sell-down of between 37,692,307 and 70,625,000 existing shares by the Selling Shareholders (the new shares and the existing shares comprised by the Offering are jointly referred to as the “Offer Shares”), excluding any shares subject to the overallotment option.
The Nets group’s current shareholders include certain funds managed by Advent International Corporation (the “Advent Funds”) (43.0%) and certain funds advised by Bain Capital Private Equity (Europe) L.L.P. (the “Bain Capital Funds”) (43.0%) through a joint holding company established for the IPO, AB Toscana (Luxembourg) Investment S.à r.l. (the “Significant Shareholder”); ATP through ATP Private Equity Partners IV K/S and Via Venture Partners Fond II K/S (jointly referred to as “ATP Investment Vehicles”) (5.0%); members of Nets’ management through eInvestments af 23. marts 2014 ApS (“eInvestments”) (8.6%); and the NH Fintech ApS indirectly controlled by the Nets CEO and his related parties (“NH Fintech”) (0.4%).11 The stated ownership stakes are before the completion of the Offering and assumes an offer price at the midpoint of the offer price range and represent indicative approximations of the beneficial ownership in Nets A/S pre-IPO and after a reorganisation of the Nets’ group structure to be carried out in connection with an IPO. The shareholders have invested in different Nets entities and the exact ownership stakes in Nets A/S after the reorganisation will ultimately depend on, among other things, the final offer price.
The Significant Shareholder, ATP Investment Vehicles, eInvestments and NH Fintech are jointly referred to as the “Selling Shareholders”.
In addition, the Offering includes an overallotment option of 15,750,000 additional shares granted by the Significant Shareholder, the ATP Investment Vehicles and NH Fintech (pro rata to their sale of existing Offer Shares), representing up to 15% of the Offer Shares. The overallotment option is exercisable in whole or in part until 30 calendar days after the first day of trading and official listing on Nasdaq Copenhagen. The offer price will be determined through a book-building process and is expected to be announced, together with the final number of Offer Shares sold in the Offering through Nasdaq Copenhagen no later than 8:00 a.m. CET on 27 September 2016.
The offer period will commence on 13 September 2016 and will close no later than 11:00 a.m. CET on 26 September 2016, but may be closed in whole or in part at the earliest on 22 September 2016 at 00:01 a.m. CET. The offer period in respect of applications for purchases of amounts up to, and including, DKK 3 million may be closed before the remainder of the Offering is closed. Any such earlier closing in whole or in part will be published through Nasdaq Copenhagen.
Payment for and settlement of the Offer Shares are expected to take place on or around 29 September 2016 (the “Settlement Date”) by way of delivery of temporary purchase certificates under the temporary ISIN DK0060745453 (the “Temporary Purchase Certificates”) against payment in immediately available funds in Danish kroner in book-entry form to investors’ accounts with VP SECURITIES A/S (“VP Securities”) and through the facilities of Euroclear Bank S.A./N.A., as operator of the Euroclear System (“Euroclear”) and Clearstream Banking, S.A. (“Clearstream”). Subject to completion of the Offering and registration of the new Offer Shares with the Danish Business Authority, the Temporary Purchase Certificates will automatically be exchanged in VP Securities for a corresponding number of shares in the Company (“Shares”), which are expected to be delivered two business days after the Settlement Date under the permanent ISIN DK0060745370 in book-entry form to the holder of the Temporary Purchase Certificates’ account with VP Securities and through the facilities of Euroclear and Clearstream.
Prior to the Offering, there has been no public market for the Temporary Purchase Certificates or the Company’s Shares. Application has been made for the Temporary Purchase Certificates to be admitted to trading on Nasdaq Copenhagen (the “Admission”) under the symbol “NETS TEMP” and for the Shares to be admitted to trading and official listing on Nasdaq Copenhagen under the symbol “NETS”.
The Admission is subject to, among other things, completion of the IPO reorganisation (described below), Nasdaq Copenhagen’s approval of the distribution of the Offer Shares, the Offering not being withdrawn prior to the settlement of the Offering and the Company making an announcement to that effect.
The first day of trading and official listing on Nasdaq Copenhagen is expected to be 27 September 2016 subject to the Offering not being withdrawn prior to settlement and completion of the Offering or accelerated. The first day of trading of the Temporary Purchase Certificates on Nasdaq Copenhagen is expected to be 27 September 2016 and the last day of trading of the Temporary Purchase Certificates on Nasdaq Copenhagen is expected to be 29 September 2016. The first day of trading of the Shares on Nasdaq Copenhagen under the permanent ISIN is expected to be 30 September 2016. In connection with the Temporary Purchase Certificates being automatically exchanged for Shares, the Temporary Purchase Certificates will cease to exist.
If the Offering is terminated or withdrawn: the Offering and any associated arrangements will lapse, all submitted orders will be automatically cancelled, any monies received in respect of the Offering will be returned to the investors without interest (less any transaction costs) and admission to trading and/or official listing of the Temporary Purchase Certificates or the Shares on Nasdaq Copenhagen will be cancelled. Consequently, any trades in the Temporary Purchase Certificates or the Shares effected on or off the market before settlement of the Offering may subject investors to liability for not being able to deliver the Temporary Purchase Certificates and/or the Shares sold and investors who have sold or acquired Temporary Purchase Certificates and/or Shares on or off the market may incur a loss. All dealings in the Temporary Purchase Certificates and/or Offer Shares prior to settlement of the Offering are for the account of, and at the sole risk of, the parties concerned.
The Offering includes an initial public offering in Denmark to institutional and retail investors, a private placement in the United States only to persons who are qualified institutional buyers or QIBs in reliance on Rule 144A under the U.S. Securities Act; and private placements to institutional investors in the rest of the world in compliance with Regulation S under the U.S. Securities Act.
An English language Offering Circular and a Danish translation thereof (together, the "Offering Circulars") have been prepared. Special attention should be given to the risk factors that are described in the beginning of the Offering Circulars.
The Offering Circular will be made available to eligible investors at no cost at the registered office of Nets, Lautrupbjerg 10, DK-2750 Ballerup. The Offering Circular can also be obtained upon request from Nordea Bank Danmark A/S, Asset Services Global DK, PO Box 850, 0900 Copenhagen C, Denmark, phone: +45 55 47 53 38, e-mail: email@example.com or Danske Bank A/S, Holmens Kanal 2-12, 1092 Copenhagen K, Denmark, phone: +45 70 23 08 34, e-mail: firstname.lastname@example.org, and can be requested through Nordea's and Danske Bank’s branches in Denmark. The Offering Circular is also available to eligible persons on the Nets website, www.nets.eu.
Nets A/S has been formed for the purpose of being admitted to trading and official listing on Nasdaq Copenhagen as the parent company of the Nets group by acquiring Nassa Topco AS, the current parent holding company of the Nets operating group, pursuant to an IPO reorganisation, which will be carried out in connection with the IPO. Nets A/S does not currently have any material assets or liabilities and does not conduct any operating activities prior to the effectiveness of the IPO reorganisation and there are no financial statements reflecting the operations of the business conducted by the Company. Accordingly, the financial results included in the Offering Circular relate to consolidated historical financial information of Nassa Topco AS, which reflects the operations of the Nets group, and which is contemplated to be acquired by the Company upon completion of the IPO reorganisation.
Bank syndicate and advisors
Deutsche Bank, Morgan Stanley and Nordea have been appointed to act as Joint Global Coordinators and Joint Bookrunners for the intended IPO. Danske Bank, DNB Markets, JPMorgan and UBS Investment Bank have been appointed to act as Joint Bookrunners. Carnegie, OP Corporate Bank, SEB, SpareBank 1 Markets and Sydbank Markets have been appointed to act as Co-Lead Managers. Lazard & Co. Limited is acting as financial advisor to Nets.