Klövern AB: Klövern announces a mandatory public cash offer to the shareholders of Tobin

The Offer will not, and this press release may not be distributed, directly or indirectly, forwarded or transmitted to, from or within, and no acceptance forms will be accepted by shareholders or anyone else on behalf of the shareholders in especially Australia, Hong Kong, Japan, Canada, New Zealand, South Africa, Singapore, Switzerland, Taiwan, Brazil or USA (including District of Columbia), or any jurisdiction in where the submission of the Offer, distribution of this press release or the acceptance of the Offer would be contrary to applicable laws or regulations or require further offer document being established or registration occur or that any other measures in addition to those required by Swedish law.

Klövern announces a mandatory public cash offer to the shareholders of Tobin Properties

Klövern AB (publ) (“Klövern“) hereby announces, through its indirectly wholly-owned subsidiary Dagon Sweden AB, registration number 556473-1213, (the “Offeror“) a mandatory public cash offer in accordance with the Takeover Rules for certain trading platforms, effective as of 1 November 2017 by the Swedish Corporate Governance Board (the “Takeover Rules“) to the shareholders of Tobin Properties AB (publ), registration number 556733-4379, (“Tobin Properties“) to tender all outstanding ordinary shares and Class A preference shares in Tobin Properties to the Offeror.

As compensation, the Offeror offers SEK 20 in cash per ordinary share and SEK 108.50 in cash per Class A preference share in Tobin Properties that are not already owned by the Offeror (the “Offer“). The shares in Tobin Properties are traded on Nasdaq First North Premier (“First North Premier“). The Offeror has subscribed for 7,500,000 ordinary shares in Tobin Properties at a price of SEK 20 per ordinary share in a directed share issue (the “Directed Share Issue“), corresponding to issue proceeds in a total amount of SEK 150 million. The Offeror’s ownership in Tobin Properties after the Directed Share Issue amounts to approximately 40 per cent of the total number of outstanding shares and approximately 42 per cent of the total number of outstanding votes in Tobin Properties. The obligation for the Offeror to announce the Offer occurred on 17 January 2018 when the Offeror was entered as owner in Tobin Properties’ share register after the registration of the Directed Share Issue with the Swedish Companies Registration Office. For further information, see press release published by Klövern on 17 January 2018.

On 5 February 2018, Tobin Properties announced the outcome of a rights issue with preferential rights for its shareholders which was fully guaranteed by Klövern. The rights issue had been fully subscribed whereas Klövern will not need to fulfill its guarantee commitment. When the rights issue is registered, which is expected to occur on or about 12 February 2018, the Offeror’s ownership in Tobin Properties will amount to approximately 35 per cent of the total number of outstanding shares and approximately 36 per cent of the total number of outstanding votes in Tobin Properties. Therefore, the Offeror’s obligation to announce the Offer in accordance with the provisions of Section III of the Takeover Rules still applies.

The Offer in brief

• At the announcement of the Offer, the Offeror owns 7,500,000 ordinary shares in Tobin Properties, representing approximately 40 per cent of the total number of outstanding shares and approximately 42 per cent of the total number of outstanding votes in Tobin Properties. The shares were acquired through the Directed Share Issue.
• Following registration by Tobin Properties of its announced rights issue, the Offeror’s ownership in Tobin Properties will amount to approximately 35 per cent of the total number of outstanding shares and approximately 36 per cent of the total number of outstanding votes in Tobin Properties.
• The shareholders in Tobin Properties are offered SEK 20 in cash per ordinary share and SEK 108.50 in cash per Class A preference share in Tobin Properties that are not already owned by the Offeror. The total value of the Offer comprises to approximately SEK 367,764,557 based on a total number of 13,962,157 shares outstanding in Tobin Properties that are not already owned by the Offeror, whereof 12,961,915 are ordinary shares and 1,000,242 are Class A preference shares.
• The Offer corresponds to the following premiums:
  • a negative premium of approximately 2.0 per cent compared to the closing price of SEK 20.40 on First North Premier for the ordinary shares in Tobin Properties and a premium of approximately 0.0 per cent to the closing price of SEK 108.50 on First North Premier regarding the Class A preference shares in Tobin Properties on 8 February 2018; and
  • a negative premium of approximately 7.4 per cent to the volume weighted average price of SEK 21.61 per ordinary share in Tobin Properties and a premium of approximately 0.5 per cent to the volume weighted average price of SEK 107.92 per Class A preference share in Tobin Properties during a period of twenty (20) trading days prior to the announcement of the Offer.
• The Offer is not subject of any conditions for completion of the Offer.
• The Offer will not be subject to any financing condition. The Offer is fully financed by existing and available cash and through available credit facilities.
• An offer document relating to the Offer is expected to be announced on 23 February 2018 and the acceptance period of the Offer is expected to commence on 26 February 2018, and expire on 26 March 2018.
• The preliminary date for settlement is expected to be about 4 April 2018.
• The Offer is governed by the Takeover Rules and the Swedish Securities Council’s rulings regarding interpretation and application of the Takeover Rules.

                       
Background and reasons for the Offer

The Offer is announced because of the mandatory public offer obligation which the Offeror became subject to after the acquisition of ordinary shares in Tobin Properties through the Directed Share Issue. Thereby, the Offeror became the new main owner of Tobin Properties. The Offer is not motivated by any ambition to acquire the entire Tobin Properties. Klövern does not plan to make any significant changes to Tobin Properties’ business after the Offer. Neither any change regarding Tobin Properties’ management and other employees, including employment conditions are planned.

“In connection with Klövern’s ambition to invest in housing development through Klövern Living, a unique opportunity has arisen for Klövern to position itself on the important Stockholm market. An investment by Klövern in Tobin Properties is not an expression of the housing market having bottomed out, on the contrary it is a way to take advantage of future opportunities which a probably weak market during 2018 will offer. Tobin Properties has a very talented development team which with stronger financial muscles can use opportunities which may arise in the wake of a weaker housing market”, says Rutger Arnhult, CEO of Klövern.

The Offer

The Offer is announced according to the Takeover Rules and the Offeror offers SEK 20 in cash per ordinary share and SEK 108.50 in cash per Class A preference share in Tobin Properties that are not already owned by the Offeror.

No commission will be charged in connection with the Offer.

The offered consideration for the shares will be adjusted if Tobin Properties carries out a dividend or other transfer of value to the shareholders before settlement of the Offer is announced and will consequently be reduced by a corresponding amount per share for each such dividend and transfer of value.

Premium

The Offer represents a negative premium of approximately 2.0 per cent compared to the closing price of SEK 20.40 on First North Premier for the ordinary shares in Tobin Properties and a premium of approximately 0.0 per cent to the closing price of SEK 108.50 on First North Premier regarding the Class A preference shares in Tobin Properties. Further, the Offer represents a negative premium of approximately 7.4 per cent to the volume weighted average price of SEK 21.61 per ordinary share in Tobin Properties and a premium of approximately 0.5 per cent to the volume weighted average price of SEK 107.92 per Class A preference share in Tobin Properties during a period of twenty (20) trading days prior to the announcement of the Offer.

Total value of the Offer

The Offer comprises all outstanding shares in Tobin Properties that are not already owned by the Offeror, i.e. 12,961,915 ordinary shares and 1,000,242 Class A preference shares. The total value of the Offer corresponds to approximately SEK 367,764,557 based on in total 13,962,157 outstanding shares in Tobin Properties.

Conflict of interest

Rutger Arnhult is shareholder, CEO and a member of the board in Klövern, a member of the board and chairman of the Offeror, and is also a member of the board in Tobin Properties. According to Section IV of the Takeover Rules, the board of directors in Tobin Properties is obliged to obtain and announce a fairness opinion from independent expertise regarding the Offer. Further, the acceptance period of the Offer shall lapse for at least four weeks. In addition, Rutger Arnhult is prevented to participate in preparations or decisions of any question related to the Offer as a member of the board in Tobin Properties according to Section II.18 and II.19 of the Takeover Rules.

Prior transactions and the ownership of Klövern in Tobin Properties

At the time of the announcement of the Offer, the Offeror owns 7,500,000 ordinary shares in Tobin Properties corresponding to approximately 40 per cent of the total number of shares outstanding and 42 per cent of the total number of outstanding votes in Tobin Properties. The shares were acquired through the Directed Share Issue in Tobin Properties. On 5 February 2018, Tobin Properties announced the outcome of a rights issue with preferential rights for its shareholders which was fully guaranteed by Klövern. The rights issue had been fully subscribed. Thus, Klövern will not need to fulfill its guarantee commitment. When the rights issue is registered, which is expected to occur on 12 February 2018, the Offeror’s ownership in Tobin Properties will amount to approximately 35 per cent of the total number of outstanding shares and approximately 36 per cent of the total number of outstanding votes in Tobin Properties.

During a period of six months prior to the announcement of the Offer, the Offeror has acquired ordinary shares in Tobin Properties at a price of SEK 20 per share through the Directed Share Issue. Thus, the acquisition is a so called pre-transaction according to the Takeover Rules which means that the terms and conditions of the part of the Offer concerning the ordinary shares in Tobin Properties may not be less favorable than the terms and conditions of the pre-transaction. The offered price of the ordinary shares is the lowest possible price that the Offeror can offer according to the provisions on mandatory public offers in the Takeover Rules.

The Offeror owns or control no other financial instruments in Tobin Properties carrying a financial exposure equivalent to a shareholding in Tobin Properties at the time of the announcement of the Offer.

During the acceptance period of the Offer, the Offeror may acquire, or enter into arrangements to acquire shares in Tobin Properties. All such purchases or arrangements will be in accordance with the Takeover Rules and Swedish law and disclosed in accordance with applicable rules.

The financing of the Offer

The Offer will not be subject to any financing conditions. The Offer is fully financed by existing and available cash and through available credit facilities.

Due Diligence

The Offeror has conducted a limited due diligence of Tobin Properties concluding confirmations on commercial, financial and legal information. Tobin Properties has announced that no other information that could possibly affect the share price other than already public information of Tobin Properties has been provided to the Offeror.

Indicative timetable

Publication of the offer document:  23 February 2018

Acceptance period:  26 February 2018 – 26 March 2018

Settlement date: around 4 April 2018

The Offeror reserves the rights to extend the acceptance period for the Offer, as well as to bring forward or postpone the date of settlement. In case the acquisition of shares in Tobin Properties, directly or indirectly, requires the approval or authorization from any authority, the Offeror reserves the right to adjust the Offer with relation to potential regulatory requirements.

Statement from the board of directors in Tobin Properties and fairness opinion

The board of directors of Tobin Properties has informed the Offeror that the work on the statement of the board of directors and the obtaining of a so-called fairness opinion is in progress and that the statement and the fairness opinion will be announced as soon as possible, but no later than two weeks before the expiry of the acceptance period.

Conditions to the Offer

The Offeror does not set any conditions for completion of the Offer.

Compulsory acquisition and de-listing

As mentioned above, Klövern’s ambition is not to acquire the entire Tobin Properties. However, in the event that the Offer is accepted to such extent that Klövern, directly or indirectly, in connection with the Offer or by other means, becomes the owner of more than 90 per cent of all the shares of Tobin Properties, the Offeror may initiate a compulsory acquisition procedure under the Swedish Companies Act (Sw. aktiebolagslagen (2005:551)) to acquire all remaining shares in Tobin Properties. In any such scenario, Klövern intends to promote a de-listing of Tobin Properties’ shares from First North Premier.

Important information about LEI and NID at acceptance

According to MiFID II and starting from 3 January 2018, all investors must have a global identification code in order to conduct a securities transaction. These regulations require legal entities to apply for registration of a Legal Entity Identifier (LEI code) and natural persons need to find their National ID or National Client Identifier (NID number) in order to accept the Offer. Please note that it is the shareholder’s legal status that determines whether a LEI code or NID number is required, and that the issuing agent may be prevented from performing the transaction on behalf of the person in question if a LEI code or NID number (as applicable) is not provided.

Legal persons who need to obtain a LEI code may contact one of the suppliers available on the market. Through this link approved institutions for the global LEI system can be found: www.gleif.org/en/about-lei/how-to-get-an-lei-find-lei-issuing-organizations.

For natural persons who only have Swedish citizenship, the NID number consists of the designation “SE” followed by the person’s social security number. If the person in question has more or anything other than Swedish citizenship, the NID number may be any other type of number.

Apply for registration of a LEI code (legal persons) or find out the NID number (natural persons) in good time since this information is required in the application form upon acceptance of the Offer.

Applicable law, disputes etc.

Swedish law is applicable to the Offer. The Takeover Rules and the Swedish Securities Council’s rulings regarding interpretation and application of the Takeover Rules and, if applicable, the Swedish Council’s rulings regarding interpretation and application of the Swedish Industry and Commerce Stock Exchange Committee pre-existing rules on takeover offers on the stock market also applies to the Offer. Disputes relating to the Offer shall be settled exclusively by Swedish court, with the Stockholm District Court as the first instance.

The Offer is not being made (nor will any acceptance by shareholders or anyone else on behalf of the shareholders be approved) in any jurisdiction in where the submission of the Offer or the acceptance of the Offer cannot occur, in accordance with laws and regulations of the jurisdictions.

The Offer is not being made, directly or indirectly, by use of mail or any other means or instrumentality (including, without limitation, facsimile transmission, e-mail, telex, telephone and the Internet) in or into especially Australia, Hong Kong, Japan, Canada, New Zealand, South Africa, Singapore, Switzerland, Taiwan, Brazil or USA, and the Offer cannot be accepted by any such use, means, instrumentality or facility of, or from within especially Australia, Hong Kong, Japan, Canada, New Zealand, South Africa or USA (including the District of Columbia).

As a result, this press release, the offer document, the acceptance form or other documentation relating to the Offer will not, and may not, be sent by mail or in any other way be distributed, forwarded or transmitted to, from or within especially Australia, Hong Kong, Japan, Canada, New Zealand, South Africa, Singapore, Switzerland, Taiwan, Brazil or USA (including the District of Columbia). The Offeror will not offer any consideration in accordance with the Offer to, or accept acceptance forms from especially Australia, Hong Kong, Japan, Canada, New Zealand, South Africa, Singapore, Switzerland, Taiwan, Brazil or USA (including the District of Columbia).

Advisors

MAQS Advokatbyrå Stockholm AB is acting as legal advisor to Klövern in relation to the Offer.

Additional information about the Offer

The information was submitted for publication on 9 February 2018 at 8:00 CET.

For additional information about the Offer, please visit kelly.corem.se. All inquiries related to the Offer should be directed to: Lars Norrby, IR, phone: +46 (0)76-777 38 00, e-mail: lars.norrby@klovern.se.

Klövern in brief

Klövern is one of Sweden’s largest listed real estate companies. Klövern owns and manages more than 400 properties which have a total lettable area of close to three million square meters. Klövern offers its tenants attractive premises not only in Stockholm, Gothenburg and Malmö but also in a number of strong regional cities across the country as well as in Copenhagen. Klövern focuses primarily on office properties, but also offers premises for companies and organizations active in health care, education, retail as well as in warehouse/logistics. Furthermore, Klövern Living is working on a number of residential development projects. For further information about Klövern, see kelly.corem.se.

Klövern AB (publ)

For additional information:
Rutger Arnhult, CEO, +46 70-458 24 70, rutger.arnhult@klovern.se
Lars Norrby, IR, +46 76-777 38 00, lars.norrby@klovern.se

Klövern is a real estate company committed to working closely with customers to offer them efficient premises in growth regions. Klövern is listed on Nasdaq Stockholm. For further information, see kelly.corem.se.

Klövern AB (publ), Bredgränd 4, 111 30 Stockholm. Phone: +46 (0)10-482 70 00. E-mail: info@klovern.se.

This information is information that Klövern AB is obliged to make public pursuant to the Takeover Rules and the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, on 9 February 2018, at 8:00 CET.