EQS Group-Ad-hoc: Airopack Technology Group AG / Key word(s): Capital
Reorganisation/Financing
Airopack Technology Group AG announces a comprehensive recapitalisation plan
with a fully underwritten EUR117m rights offering, significant debt
reduction and maturity extension of remaining indebtedness to 2022, and a
new governance structure
30-Nov-2018 / 20:06 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 KR
The issuer is solely responsible for the content of this announcement.
/
THIS DOCUMENT DOES NOT CONTAIN OR CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF ANY OFFER TO BUY SECURITIES IN THE UNITED STATES OR IN ANY
OTHER JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORISED OR
TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE AN OFFER OR SOLICITATION. THE
SECURITIES OF AIROPACK TECHNOLOGY GROUP AG HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE UNITED STATES SECURITIES LAWS AND MAY NOT BE OFFERED OR
SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM
REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED. NEITHER
AIROPACK TECHNOLOGY GROUP AG NOR ITS SHAREHOLDERS INTEND TO REGISTER ANY
PORTION OF THE OFFERING IN THE UNITED STATES OR CONDUCT A PUBLIC OFFERING OF
SECURITIES IN THE UNITED STATES.
Airopack Technology Group AG announces a comprehensive recapitalisation plan
with a fully underwritten EUR117m rights offering, significant debt
reduction and maturity extension of remaining indebtedness to 2022, and a
new governance structure
*- *Comprehensive recapitalisation plan to strengthen Airopack's balance
sheet
- EUR117m Rights Offering, with existing shareholders entitled to receive
subscription rights pro-rata to their existing shareholdings
- Rights offer fully underwritten by funds managed by affiliates of Apollo
Global Management
- Short term liquidity bridge of EUR25m to finance Airopack's working
capital until completion of recapitalisation
- Significant reduction in term debt from EUR127m to EUR51m and extension of
maturities to 2022 upon completion of Rights Offering
- Quint Kelders has decided to step down as CEO; continues serving as a
member of Airopack's Board of Directors and as a strategic advisor
- Antoine Kohler, Chairman of the Board of Directors, is taking over as
interim CEO; new CEO already identified
*Baar, 30 November 2018 - *Airopack Technology Group AG ("Airopack"),
manufacturer of Planet Friendly Aerosols, today announces a comprehensive
recapitalisation programme to restructure its debt and strengthen the
Company's balance sheet (the "Recapitalisation"). Airopack plans to raise
approximately EUR117 million gross proceeds via a discounted rights offering
(the "Rights Offering") currently expected to take place in the first
half-year 2019. Shareholders will receive tradable subscription rights, and
Apollo Funds will also exercise their current existing warrants prior to the
Rights Offering. Shares for which rights have not been validly exercised in
the Rights Offering will be subscribed for in full by funds managed by
affiliates of Apollo Global Management, LLC ("Apollo Funds"). As part of the
proposed Recapitalisation, the transaction further includes a new liquidity
bridge of EUR25m, which will be provided by Apollo Funds in two tranches and
will be repaid using proceeds from the Rights Offering. In addition, Apollo
Funds will extend the maturity of EUR5m of super senior debt provided in
August 2018 with terms in line with the new liquidity bridge to further
enhance liquidity.
Under the terms of the agreement reached today, Apollo Funds will be assured
of controlling, through a voting agreement with Q-Invest (the holding
vehicle for the shares directly owned by Quint Kelders), at least 50% plus
one share of the outstanding share capital after the conclusion of the
Rights Offering. The Company and Apollo Funds intend that this will be
achieved through on-market purchases of rights during the rights trading
period. To the extent that Apollo Funds do not have control over the
requisite number of shares after that period, Airopack will issue, upon
conclusion of the Rights Offering, up to a maximum of approximately 10
million shares to Apollo Funds via a private placement at CHF1.50 per share,
a price broadly consistent with the implied Theoretical Ex Rights Price
following the exercise of the Apollo Funds warrants and rights issue, based
on the closing of Airopack's share price on 29 November 2018. The ultimate
number of shares issued to Apollo Funds under the private placement, if any,
will depend on a number of factors, including the extent to which current
shareholders participate in the Rights Offering, how many rights Apollo
Funds acquires during the rights trading period, and the prevailing foreign
exchange rate at the time. However, Airopack will only issue as many shares
as are required to provide Apollo Funds voting control over 50% plus one
share of the enlarged share capital.
Quint Kelders, Co-Founder, Board member as well as major shareholder and
Chief Executive Officer (CEO) of Airopack has decided to hand over his CEO
responsibilities and will continue to provide his expertise through his
position on Airopack's Board of Directors and as strategic advisor to the
Company for a period of one year.
Antoine Kohler, Chairman of the Board of Directors, said: "As the Co-Founder
and Chief Executive Officer, Quint Kelders has developed and led the Company
in the past 15 years and has, together with his team, built Airopack into a
globally well respected, recognized and unique, Planet Friendly Aerosol
company. Thanks to him we are proud to have many long-standing strategic
relationships with major consumer goods customers. We sincerely thank Quint
for his deep commitment over these many years, which has always been
exemplary and very impressive and we are looking forward to continuing
working with him."
Quint Kelders added: "It has been a great pleasure and honour for me to lead
Airopack as its Co-Founder, shareholder and as CEO. The decision to step
down as CEO was not an easy one. Airopack and all its stakeholders deserve a
healthy and sustainable future which now will become possible with a
strengthened capital base and a better balance sheet. I am convinced that
the contribution to this solution made by my wife and myself as shareholders
to enable this recapitalisation, which is strongly supported by Q-Invest,
will give Airopack the scope to exploit its full business potential. The
team working for me and my family for more than 15 years has done an amazing
job in bringing Airopack to where it is as a technology today, and we have a
great future ahead. I am extremely thankful to have been part of this
amazing team for so many years and I look forward to continuing as a Board
member and strategic advisor."
In addition, Robert Seminara, Head of Apollo Europe, said: "We are excited
to finance the next stage of Airopack's expansion. We thank Quint for his
contributions to date in taking the Company to its current phase. We look
forward to partnering with the new management team and its employee base to
support continued innovation and growth at Airopack."
The Company has already identified and is in final contract negotiations
with a new CEO who is expected to start in the first quarter of 2019. Until
his arrival, Antoine Kohler, Chairman of the Board of Directors, will act as
CEO ad interim. Additional management resources, including the COO André de
Oliveira, are in place to ensure a smooth transition period.
The planned Recapitalisation is expected to provide Airopack with the
liquidity required to continue operating efficiently, including a
normalisation of its trade debt, until the Rights Offering is completed.
After completion of the Rights Offering, Airopack is expected to have a
flexible and deleveraged balance sheet and the operational flexibility
necessary to deliver its medium-term goal of a run rate volume of 300
million Airopack dispensers annually in the existing facilities by 2020.
*Background to the Rights Offering and process*
As outlined in the half year results statement on 30 September 2018, the
Company initiated discussions with its main lenders and its two largest
shareholders on a comprehensive refinancing solution that would be in the
best interest of the Company and its shareholders, and address the
continuing financing needs of the Company. As part of this process, the
Board launched a refinancing process to review and secure a broad range of
comprehensive refinancing and additional liquidity solutions with Airopack's
main shareholders and main lenders, as well as new parties. The Company also
explored and discussed potential solutions with a number of third party
financing providers. No binding agreements have been reached with any of
these parties during this timeframe. The solution announced today is the
result of several weeks of discussions between the company, Apollo Funds and
Q-Invest to reach a consensual solution that is in the best interest of both
the Company and its various stakeholders.
*Transaction structuring, voting agreement and use of funds*
Airopack plans to raise total gross proceeds of approximately EUR119 million
by way of an exercise of warrants currently held by Apollo Funds and a
discounted Rights Offering.
The Board of Directors expects to convene an Extraordinary General Meeting
("EGM") to be held in February 2019 to approve a capital reduction of the
nominal value of Airopack's registered shares from CHF5 per share to a
nominal value of CHF1 per share. Following the completion of the capital
reduction procedures, Apollo Funds will exercise 2,843,596 warrants that
they currently own at the new nominal value of CHF 1 per share. Following
the exercise of their warrants, Apollo Funds will then control approximately
32% of the enlarged share capital of Airopack.
To implement the Rights Offering and the refinancing plan, Airopack's Board
of Directors has further decided to propose to its shareholders an ordinary
capital increase in the context of Airopack's 2019 Annual General Meeting
("AGM") which is expected to be held in April 2019. The capital increase
shall be executed by way of a discounted rights offering following the AGM.
Assuming the approval of the proposed capital increase by the AGM, the new
shares will be offered to the existing Airopack shareholders through
subscription rights and accordingly, the preemptive rights of existing
shareholders will be respected. It is currently expected that Airopack's
Board of Directors will propose to issue approximately 132 million shares in
the context of this ordinary capital increase. In the Rights Offering,
shareholders are expected to be able to subscribe for new shares at the
reduced nominal value of the shares (i.e. CHF1 per share), such that the
gross proceeds amount to approximately EUR117 million. The final number of
shares to be issued and the subscription ratio will be determined
immediately prior to the AGM.
The proceeds of the Rights Offering will be used to repay an amount of
existing senior debt such that the Company will retain approximately EUR51
million of term debt post-closing (approximately EUR127m currently
outstanding). Further proceeds will be used to repay the liquidity bridge
including accrued interest, Apollo Funds' current super senior debt
including accrued interest, costs related to this transaction, operational
payables that are currently overdue, and fund cash on balance sheet to allow
the business to operate efficiently going forward. The maturity on the
remaining senior debt will be extended to June 2022, while the maturity on
the remaining super senior debt facilities is intended to be extended to
February 2022, subject to certain conditions.
Apollo Funds have also agreed to provide a new liquidity bridge of EUR25
million, which shall be repaid with proceeds from the Rights Offering. The
new liquidity provided will enable the Company to continue operating
efficiently until the completion of the Rights Offering. In addition, the
Company has agreed with Rabobank to enter into a new factoring facility.
Apollo Funds and Q-Invest have separately entered into a voting arrangement
whereby Q-Invest commits to vote shares representing approximately 23% of
the current undiluted share capital[1] at the instruction of Apollo Funds,
but only insofar (and for so long) as required to cause Apollo Funds to
control 50% plus one share of the voting shares in Airopack after the Rights
Offering has been completed. For the shares owned directly by Q-Invest,
Q-Invest has also committed to sell to Apollo Funds the rights attached to
its current shareholding.
In the event that, following the completion of the Rights Offering, Apollo
Funds do not control (including those shares outlined in the preceding
paragraph) at least 50% plus one share, then there shall be a further
capital increase, executed by way of a private placement at CHF1.50 per
share to Apollo Funds, of as many shares as are required for them to control
50% plus one share of the enlarged share capital. Therefore, as part of the
AGM, Airopack's Board of Directors will also propose a second ordinary
capital increase of up to approximately 10 million shares, which will be
conditional on Apollo Funds not reaching the 50% plus one share threshold as
described above.
As part of the consensual solution, Airopack's lenders have also agreed to
waive the covenants for the third quarter of 2018, and have agreed new
covenants with Airopack to reflect management's latest expectation for Q4
2018 and the first half of 2019.
The Recapitalisation is conditional on shareholders' approval of the capital
reduction and the share capital increases in the course of the EGM and the
AGM, respectively, and certain conditions relating to the Super Senior debt.
*Corporate governance changes *
Antoine Kohler, Chairman of the Board of Directors, is taking over the CEO
responsibilities on an ad interim basis until the new CEO will join the
Company in the first quarter 2019.
The Board of Directors of Airopack is planned, from the completion of the
Rights Offering, to contain three directors nominated by Apollo Funds, one
by Q-Invest and one independent non-executive director.
*Financial outlook *
Airopack has continued to grow sales in the second half of 2018 and so far
has made further progress with multiple key prospective customers in the
personal and home care markets in Europe, Asia and the United States.
Management intends to perform essential maintenance works in December
alongside a reinvigoration of the workforce, which combined will lead to
lower than usual output levels for that month. The Board of Directors and
the management team expect that the new proceeds from the liquidity bridge
and ultimately from the Rights Offering will allow the Company to return to
a more normal level of working capital. This, combined with the continued
improvements in operating performance in the Airopack factory, should enable
the business to continue its impressive growth and reach EBITDA breakeven
levels in the first half of 2019.
*For more information:*
Airopack Technology Group AG
Antoine Kohler, Chairman
Blegistrasse 5/1 OG
CH-6340 Baar
TF: +41 41 768 50 50
www.airopackgroup.com [1]
For investors:
Airopack Technology Group AG
Martin Eberhard
martin.eberhard@rimesa.ch
TF: +41 79 209 77 50
For media:
Tolxdorff Eicher Kollektivgesellschaft
Daniel Eicher / Theresia Tolxdorff
partners@tolxdorffeicher.ch
TF: +41 44 718 25 25
Airopack Technology Group AG is a leading developer and supplier
of mechanical and pressure-controlled dispensing packaging
technologies and systems for manufacturers and suppliers of
cosmetics, body care, pharmaceutical and food products. The
revolutionary and worldwide and solely by ATG patented
Airopack(R) technology offers a safe, all-plastic pressurized
dispenser that is environmentally and planet friendly
Airopack Technology Group operates a Airopack Ready to Fill
manufacturing facility in Waalwijk, The Netherlands and a
Full-Service Filling operation in Heist-op-den-Berg Belgium
(Airosolutions) as well as a manufacturing plant for filling
equipment in Houten, The Netherlands (Airofiller Equipment
Solutions), The Global Research and Development Team, the
Airopack Global Management and Customer Service Organisation are
located in Waalwijk, The Netherlands.
The shares of the company are listed on the Swiss Reporting
Standard of the SIX Swiss Exchange since 2010. (Ticker: AIRN /
ISIN: CH0242606942).
www.airopackgroup.com
This document does neither constitute an offer to buy or to subscribe for
securities of Airopack Technology Group AG nor a prospectus within the
meaning of applicable Swiss law (i.e. Art. 652a or Art. 1156 of the Swiss
Code of Obligations or Art. 27 et seq. of the SIX Swiss Exchange Listing
Rules). Investors should make their decision to buy or exercise subscription
rights or to buy or to subscribe to shares of Airopack Technology Group AG
solely based on the official prospectus (the "Prospectus") to be published
by Airopack Technology Group AG. Investors are furthermore advised to
consult their bank or financial adviser before making any investment
decision.
This publication may contain specific forward-looking statements, e.g.
statements including terms like "believe", assume", "expect", "forecast",
"project", "may", "could", "might", "will" or similar expressions. Such
forward-looking statements are subject to known and unknown risks,
uncertainties and other factors which may result in a substantial divergence
between the actual results, financial situation, development or performance
of the company and those explicitly or implicitly presumed in these
statements. Against the background of these uncertainties, readers should
not rely on forward-looking statements. Airopack Technology Group AG assumes
no responsibility to update forward-looking statements or to adapt them to
future events or developments.
The information contained herein shall not constitute an offer to sell or
the solicitation of an offer to buy, in any jurisdiction in which such offer
or solicitation would be unlawful prior to registration, exemption from
registration or qualification under the securities laws of any jurisdiction.
This announcement is not for distribution, directly or indirectly, in or
into the United States (including its territories and dependencies, any
state of the United States and the District of Columbia), Canada, Japan,
Australia or any jurisdiction into which the same would be unlawful. This
announcement does not constitute or form a part of any offer or solicitation
to purchase, subscribe for or otherwise acquire securities in the United
States, Canada, Japan, Australia or any jurisdiction in which such an offer
or solicitation is unlawful. Airopack Technology Group AG shares have not
been and will not be registered under the US Securities Act of 1933, as
amended (the "*Securities Act*") or under any securities laws of any state
or other jurisdiction of the United States and may not be offered, sold,
taken up, exercised, resold, renounced, transferred or delivered, directly
or indirectly, within the United States except pursuant to an applicable
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and in compliance with any applicable
securities laws of any state or other jurisdiction of the United States.
Subject to certain exceptions, the Airopack Technology Group AG shares are
being offered and sold only outside the United States in accordance with
Regulation S under the Securities Act. There will be no public offer of
these securities in the United States.
The information contained herein does not constitute an offer of securities
to the public in the United Kingdom. No prospectus offering securities to
the public will be published in the United Kingdom. This document is only
being distributed to and is only directed at (i) persons who are outside the
United Kingdom or (ii) to investment professionals falling within article
19(5) of the Financial Services and Markets Act 2000 (Financial Promotion)
Order 2005 (the "*Order*") or (iii) high net worth entities, and other
persons to whom it may lawfully be communicated, falling within article
49(2)(a) to (d) of the Order (all such persons together being referred to as
"*relevant persons*"). The securities are only available to, and any
invitation, offer or agreement to subscribe, purchase or otherwise acquire
such securities will be engaged in only with, relevant persons. Any person
who is not a relevant person should not act or rely on this document or any
of its contents.
Any offer of securities to the public that may be deemed to be made pursuant
to this communication in any EEA Member State that has implemented Directive
2003/71/EC (together with any applicable implementing measures in any Member
State, the "*Prospectus Directive*") is only addressed to qualified
investors in that Member State within the meaning of the Prospectus
Directive.
[1] Current undiluted share capital of 19,945,372 registered shares as of 29
November 2018
End of ad hoc announcement
Language: English
Company: Airopack Technology Group AG
Blegistrasse 5
6340 Baar
Switzerland
Phone: +41 417663500
Fax: +41 417663509
E-mail: liebwin.vanlil@airopackgroup.com
Internet: www.airopackgroup.com
ISIN: CH0242606942
Listed: SIX Swiss Exchange
End of Announcement EQS Group News Service
753499 30-Nov-2018 CET/CEST
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(END) Dow Jones Newswires
November 30, 2018 14:06 ET (19:06 GMT)
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