Bluestart Elkem will purchase 100 percent of the shares in a Luxembourg company, which is yet to be established, which in turn will own REC Solar Holdings AS and all of the assets and liabilities of REC Solar at a cash purchase price equal to NOK 108.50 per share. This transaction represents a premium of 22.6 percent and 27.1 percent to the 1-month and 3-month volume weighted average share price, respectively. The total cash consideration being NOK 4,340 million.
The transaction is subject to approval by an extraordinary general meeting of REC Solar, expected to be held no later than 16 January 2015. The Board of Directors of the Company has unanimously resolved to recommend the Transaction to its shareholders.
Datum AS, Ferncliff Listed DAI AS, Ferncliff TIH 1 AS, Gross Management AS, QVT Fund IV LP I, QVT Fund V LP I, Quintessence Fund LP and Dallas Asset Management AS, holding a total of 20.2 percent of the outstanding shares of the Company, have on certain conditions entered into undertakings not to sell any shares before the EGM and to vote in favour of the Transaction at the EGM.
Ferncliff Listed DAI AS, Ferncliff TIH 1 AS, and Gross Management AS are controlled by Øystein Stray Spetalen, a board member and primary insider of the Company and Dallas Asset Management AS is controlled by Jan Christian Opsahl, a board member and primary insider of the Company.
“This proposed transaction is a result of an extensive and broadly marketed process where the Company has explored opportunities to maximize value for shareholders” said Ole Enger, Chairman of REC Solar. “We are pleased that we today are in position to announce the combination of the Elkem Group and REC Solar. The Board of Directors of REC Solar views the combination as a positive outcome for the Company, its excellent workforce and other stakeholders, and we look forward to working with the Elkem Group to complete the Transaction. The Board believes that a combination with the Elkem Group will provide a strong platform to further develop REC Solar.”
Helge Aasen, the CEO of Elkem AS, added that the Elkem Group has a strategic goal to grow its presence in the solar industry and that the goal is to establish a leading integrated PV player. Ms Aasen said that the Elkem Group and REC Solar have developed a strong business relationship and there is a good strategic match between the companies ensuring that a combined entity will have a strong basis for further development of the business by leveraging REC Solar's leading global brand, strong distribution channels and reputation for quality.
The transaction is not subject to any financing condition, but is subject to other customary conditions including all required regulatory approvals. REC Solar has undertaken not to actively solicit offers from third parties which would compete with the transaction, and has accepted a cost coverage fee of $10 million if the Board of the Company changes its recommendation and the transaction is therefore not completed due to a superior offer.
Completion is expected in March/April 2015. The Board of Directors of REC Solar expects thereafter to delist and liquidate the Company and return all cash, net of transaction costs, to shareholders.
Nomura International plc is acting as financial advisor to REC Solar with Cipriano AS acting as strategic advisor. Advokatfirmaet Schjødt AS is acting as legal advisor. DNB Markets is acting as financial advisor to Bluestar Elkem with Thommessen acting as legal advisors.
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