SLM Solutions Group AG: Conclusion of a financing agreement and planned subscription offer of convertible bonds
Disclosure of inside information pursuant to Article 17 of the Regulation (EU) No 596/2014
Lübeck, 26 March 2020 – SLM Solutions Group AG (ISIN DE000A111338 (shares) and DE000A2GSF58 (convertible bond 2017/2022), hereinafter “SLM” or the “Company”) today entered into a financing agreement with its largest shareholder, Cornwall GmbH & Co. KG (“Cornwall”), a company advised by Elliott Advisors (UK) Limited. Under this agreement, Cornwall has undertaken, subject to certain conditions recorded therein, to subscribe for new convertible bonds in a total volume of approx. EUR 60 million that SLM intends to issue starting in June 2020 until 30 September 2023 at the latest, to the extent these are not subscribed for by the Company’s other shareholders or convertible bond holders and provided that these correspond to the terms agreed in the financing agreement. By conclusion of the financing agreement, the Company strengthens its access to liquid funds significantly beyond its current status to ensure that SLM will have sufficient financial resources for its business and to expedite its development projects also in a market setting which is affected by uncertainty due to COVID 19.
To this end, SLM intends to offer its shareholders and the holders of its convertible bond 2017/2022 a first tranche of new convertible bonds with a volume of EUR 15 million (the “New Convertible Bonds”) for subscription in the period from 26 June 2020 to 10 July 2020 (the “Subscription Offer”). The full placement of the New Convertible Bonds will be guaranteed by Cornwall in accordance with the terms of the financing agreement. The initial conversion price at which the holders of the New Convertible Bonds can convert these into shares of the Company will amount to EUR 6.75 for each new share. The New Convertible Bonds will be issued at 100% of its nominal value, will have a coupon of 2% per year and a maturity until 30 September 2026. The New Convertible Bonds will initially be convertible into up to 2,222,222 new SLM shares, which can be issued from the already existing Contingent Capital of the Company.
The terms and conditions of the New Convertible Bonds shall, inter alia, provide that SLM will offer the holders of the New Convertible Bonds up to two further tranches of convertible bonds with essentially identical terms (the “Additional Convertible Bonds”) in a total nominal amount of approx. EUR 45 million for subscription, if certain conditions precedent, which mainly refer to the achievement of the future growth targets of SLM, are met or waived by the holders of the New Convertible Bonds with the required majority. The full placement of the Additional Convertible Bonds will also be guaranteed by Cornwall. The volume of the first Additional Convertible Bond (“Second Tranche”) will amount to EUR 15 million, the volume of the second Additional Convertible Bond (“Third Tranche”) to approx. EUR 30 million. The initial conversion price at which the holders of the Second Tranche can convert these into shares of the Company will amount to EUR 7.75 per New Share, while the initial conversion price of the Third Tranche will amount to EUR 8.75 per New Share.
SLM currently does not intend to apply for listing of the New Convertible Bonds or the Additional Convertible Bonds on any domestic or foreign stock exchange.
Further details of the Subscription Offer will be announced by SLM in due time prior to the start of the subscription period in June 2020. The New Convertible Bonds will be offered only on the basis of a securities prospectus to be approved by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht) and to be published by the Company, which will be made available on the Company’s website at www.slm-solutions.com.
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This release is does not constitute an offer to purchase or subscribe for any securities nor a solicitation to submit an offer to purchase or subscribe for any securities in the Federal Republic of Germany, Japan, Australia, Canada or the United States of America or any other jurisdiction.
The convertible bonds and the subscription rights referred to herein have not been and will not be registered under the Securities Act of 1933, as amended (the “Securities Act”) or with any securities regulatory authority of any state or other jurisdiction in the United States. The convertible bonds and the subscription rights referred to herein may only be sold or offered in the United States pursuant to an exemption from registration under the Securities Act and the securities regulations of any state or other jurisdiction in the United States. The same applies for an offer, a sale or any distribution to any U.S. person within the meaning of the Securities Act.
About the company:
Lübeck-based SLM Solutions Group AG is a leading provider of metal-based additive manufacturing technology. The company's shares are traded in the Prime Standard of the Frankfurt Stock Exchange. SLM Solutions focuses on the development, assembly and sale of machines and integrated system solutions in the field of selective laser melting. SLM Solutions currently employs over 400 members of staff in Germany, Canada, China, France, India, Italy, Russia, Singapore and the USA. The products are utilised worldwide by customers in particular from the aerospace, energy, healthcare and automotive industries.