At announcement, the Offer values each Hemfosa common share at SEK 126.15 and each Hemfosa preference share at SEK 194.63 and the total offer value for all shares in Hemfosa is approximately SEK 23,521 million.
• The total Offer consideration consists of a combination of SBB Class B common shares and cash for Hemfosa common shares and a combination of SBB Class D common shares and cash for Hemfosa preference shares. SBB is offering each Hemfosa shareholder the following consideration alternatives.
Offer for Hemfosa common shares:
▪ in respect of 55 percent of the number of Hemfosa common shares tendered by such shareholder, 5.5 SBB Class B common shares per Hemfosa common share; and
▪ in respect of the remaining 45 percent of the number of Hemfosa common shares tendered by such shareholder, SEK 120.00 in cash per Hemfosa common share.
Offer for Hemfosa preference shares:
▪ in respect of 55 percent of the number of Hemfosa preference shares tendered by such shareholder, 5.6 SBB Class D common shares per Hemfosa preference share; and
▪ in respect of the remaining 45 percent of the number of Hemfosa preference shares tendered by such shareholder, SEK 195.00 in cash per Hemfosa preference share.
• The Total Offer Value of approximately SEK 23,521 million, is comprised of the total offer value for the common shares of approximately SEK 21,380 million and the total offer value for the preference shares of approximately SEK 2,141 million.
• SBB offers Hemfosa shareholders a Mix & Match Facility, whereby each of the Hemfosa common and preference shareholders, subject to the restrictions set out below, may elect to receive as much share consideration or as much cash consideration as possible for tendered Hemfosa shares. In aggregate, up to a total of 512,701,953 SBB Class B common shares and 33,879,996 SBB Class D common shares will be issued as consideration under the Offer, and up to a total of SEK 10,118 million will be paid in cash.6 This proportion will not be varied as a result of elections made under the Mix & Match Facility. In order for the individual shareholders in Hemfosa to receive a higher proportion of a certain requested consideration alternative under the Mix & Match Facility, other shareholders must have made reverse elections to a corresponding extent.
• The Offer represents a premium of:
o In regard to the Common Base Case Consideration:
▪ 22.7 percent compared to the closing price of SEK 102.80 of the Hemfosa common shares on Nasdaq Stockholm on 14 November 2019, the last trading day before the announcement of the Offer.
o In regard to the Preference Base Case Consideration:
▪ 1.1 percent compared to the closing price of SEK 192.50 of the Hemfosa preference shares on Nasdaq Stockholm on 14 November 2019, the last trading day before the announcement of the Offer.
• Hemfosa common shareholders with 50 or less Hemfosa common shares, and Hemfosa preference shareholders with 25 or less Hemfosa preference shares, are entitled to elect an all cash consideration alternative.
• The board of directors of Hemfosa unanimously recommends that Hemfosa shareholders accept the Offer. The recommendation is supported by a fairness opinion provided by Handelsbanken Capital Markets.
• The acceptance period for the Offer is expected to commence around 19 November 2019 and end around 20 December 2019.
Ilija Batljan, founder and CEO of SBB, comments: “With this transaction we are creating the largest social infrastructure property owner in the Nordics. The combined company would have an attractive and stable property portfolio characterised by exposure against the Nordic welfare states with long term leases, high occupancy rates and a diversified tenant base. It is a portfolio with notable low risk due to its unique combination of community service properties with the Swedish and Norwegian state as the largest tenants and Swedish rent-regulated residential properties. Our goal is that SBB will have a BBB+ rating within 12 months and we estimate that the combined group over time will receive an improved credit rating, which has the potential to significantly reduce the cost of funding. Responsible ownership and sustainability as a central part of our business model are an important part of our core philosophy and we believe that in this regard we are the right partner for Hemfosa and that our companies together would have a very exciting future”.
Ilija Batljan concludes: “We believe that the Offer represents an opportunity for the existing shareholders of Hemfosa to realise immediate value while retaining exposure to the development of the combined organisation and the synergy realisation”.
Jens Engwall comments: “I founded Hemfosa over 10 years ago and I am positive about the opportunities that are created by the combination with SBB. Together we are now building the largest player within social infrastructure in the Nordics, and I look forward to continue as a shareholder in the combined company.”
The board of directors of Hemfosa unanimously recommends the shareholders of Hemfosa to accept the public offer made by SBB.