Investors
Freemelt has carried out a directed share issue of SEK 66 million, partly subject to resolution by an extraordinary general meeting
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Freemelt Holding AB (publ) (”Freemelt” or the ”Company”) has successfully completed a directed share issue of 11 million new ordinary shares, raising gross proceeds of SEK 66 million (the “Directed Share Issue”). The subscription price in the Directed Share Issue was set at SEK 6 per share and was determined through an accelerated book-building procedure carried out by ABG Sundal Collier. 845,000 of the new ordinary shares in the Directed Share Issue is subject to resolution by the extraordinary general meeting, which is expected to be held 13 March 2023. The Company will shortly publish a separate notice to the extraordinary general meeting.
The Directed Share Issue
Freemelt has carried out a directed share issue of 11 million new ordinary shares, partly subject to resolution by an extraordinary general meeting, at a subscription price of SEK 6 per share, consequently raising gross proceeds of SEK 66 million before deduction of transaction costs. The Directed Share Issue is made in two tranches. The Board of Directors of the Company has resolved on the first tranche of 10,155,000 shares, corresponding to approximately SEK 61 million, based on the authorisation granted by the annual general meeting held 24 May 2022 (“Tranche 1”). In accordance with the proposal by the Company’s shareholder Carlbergssjön AB, the Board of Directors has as a part of the Directed Share Issue summoned the shareholders to an extraordinary general meeting to resolve on the second tranche of 845,000 shares, corresponding to approximately SEK 5 million (“Tranche 2”). The Company will shortly publish a separate notice to the extraordinary general meeting that is expected to be held 13 March 2023.
The subscription price has been determined through an accelerated book-building procedure and corresponds to a discount of approximately 9.4 percent in relation to the 30 days’ volume weighted average price (“VWAP”) on Nasdaq First North Growth Market. The Directed Share Issue was directed to selected Swedish and international investors and was subscribed for by, among others, Stiftelsen Industrifonden (“Industrifonden“), Coeli Circulus, Bengt Julander, Carlbergssjön AB and JEQ Capital AB. The subscriptions by Industrifonden, Coeli Circulus, Bengt Julander were conditional on that Per Anell, is elected as a new board member in the Company at the annual general meeting of the Company, which is expected to be held 25 May 2023. As announced in the Company’s press release earlier today, the Board of Directors of Freemelt is positive to Per Anell being elected as a new board member and that a nomination committee is established in the Company ahead of the Company’s annual general meeting in 2023, in which election of board members up until the annual general meeting 2024 will be made. Furthermore, in accordance with the proposal by the Company’s shareholder Carlbergssjön AB, the Board of Directors has resolved to summon the Company’s shareholders to an extraordinary general meeting to resolve on Tranche 2 which in accordance with the proposal comprise a share issue, without preferential rights for the shareholders, directed to the Company’s board members Carl Palmstierna, Staffan Zackrisson, Cecilia Jinert Johansson, Johannes Heinrich Schleifenbaum and Erik Lindeblad representing Lindeblad Ventures AB as well as the Company’s CEO Daniel Gidlund. Subscription in Tranche 2 is subject to the resolution on Tranche 2 by the extraordinary general meeting that is expected to be held 13 March 2023.
Through the Directed Share Issue, the Company’s share capital will increase by SEK 550,000, from SEK 1,830,000 to SEK 2,380,000, by new issue of 11,000,000 ordinary shares, resulting in the total number of shares increasing from 36,600,000 shares to 47,600,000 shares. The Directed Share Issue results in a dilution of approximately 23.1 percent of the capital and votes for existing shareholders based on the total number of shares and votes in the Company after the Directed Share Issue.
Background and reasons
The net proceeds from the Directed Share Issue will be used to accelerate the development of the industrial machine eMELT, strengthening the sales and service organisation, working capital and investments to promote continued organic growth, including, inter alia, development resources and supply capacity.
The Company’s Board of Directors has made an overall assessment and carefully considered the possibility to raise capital through a preferential rights issue, but considers that it, for example, would entail a risk that the Company cannot provide for its capital needs and at the same time maintain an optimal capital structure. The Board of Directors has concluded that a rights issue, compared to the Directed Share Issue, (i) would take significantly longer time to execute and thereby entail increased market risk exposure, (ii) would require significant underwriting commitments from an underwriting syndicate given the current market volatility, which would entail additional costs and/or additional dilution depending on the type of consideration paid for such underwriting commitments, (iii) likely would have had to be made at a lower subscription price given the discount levels in rights issues completed on the market in recent time, and (iv) unlike a rights issue, the Directed Share Issue is to some extent expected to broaden the shareholder base and provide the Company with new reputable institutional owners and strategic investors. Considering the above, the Board of Directors has made the assessment that a directed share issue with deviation from the shareholders’ preferential right is the most favourable alternative for Freemelt and in the best interest of the Company’s shareholders and thus considers that the reasons outweigh the main rule that new issues must be carried out with preferential rights for the shareholders.
As the subscription price in the Directed Share Issue has been determined through a book-building procedure, the Board of Directors assesses that the subscription price reflects current market conditions and demand.
Tranche 2 is resolved on by the extraordinary general meeting that is expected to be held 13 March 2023. Notice to the extraordinary general meeting will be published through a separate press release. The execution of Tranche 1 is not conditional upon Tranche 2 being carried out.
Advisers
ABG Sundal Collier is acting as Sole Bookrunner in connection with the Directed Share Issue and Baker McKenzie is acting as legal advisor to Freemelt.
For more information, please contact:
Daniel Gidlund, CEO
+46 70 246 45 01
daniel.gidlund@freemelt.com
This information is such that Freemelt Holding AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014. The information was submitted for publication, through the agency of the contact person set out above, on 21 February 2023 at 23.30 CET.
About Freemelt
Freemelt is a high-tech company whose ground-breaking solution creates new opportunities for rapid growth in 3D printing, also known as additive manufacturing. The Company’s protected technology enables cost-effective printing to a consistent and high quality. By choosing an open-source solution, the conditions are created for strong growth and expansion towards manufacturing markets. Freemelt was founded in 2017, is listed on Nasdaq First North Growth Market, has 34 employees, head office in Gothenburg and a manufacturing unit in Linköping. Read more at www.freemelt.com.
Important information
The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to restrictions. The recipients of this press release in jurisdictions where this press release has been published or distributed shall inform themselves of and follow such restrictions. The recipient of this press release is responsible for using this press release, and the information contained herein, in accordance with applicable rules in each jurisdiction. This press release does not constitute an offer, or a solicitation of any offer, to buy or subscribe for any securities in the Company in any jurisdiction, neither from the Company nor from someone else.
This announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the new shares. Any investment decision in connection with the Directed Share Issue must be made on the basis of all publicly available information relating to the Company and the Company’s shares. Such information has not been independently verified by ABG Sundal Collier. The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. ABG Sundal Collier is acting for the Company in connection with the transaction and no one else and will not be responsible to anyone other than the Company for providing the protections afforded to its clients nor for giving advice in relation to the transaction or any other matter referred to herein.
This announcement does not constitute a recommendation concerning any investor’s option with respect to the Directed Share Issue. Each investor or prospective investor should conduct his, her or its own investigation, analysis and evaluation of the business and data described in this announcement and publicly available information. The price and value of securities can go down as well as up. Past performance is not a guide to future performance.
This press release does not constitute or form part of an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be sold in the United States absent registration or an exemption from registration under the US Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States. The information in this press release may not be announced, published, copied, reproduced or distributed, directly or indirectly, in whole or in part, within or into Australia, Hong Kong, Japan, Canada, New Zeeland, Singapore, South Africa, the United States or in any other jurisdiction where such announcement, publication or distribution of the information would not comply with applicable laws and regulations or where such actions are subject to legal restrictions or would require additional registration or other measures than what is required under Swedish law. Actions taken in violation of this instruction may constitute a crime against applicable securities laws and regulations.
This press release is not a prospectus for the purposes of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (the “Prospectus Regulation”) and has not been approved by any regulatory authority in any jurisdiction. The Company has not authorized any offer to the public of shares or rights in any member state of the EEA and no prospectus has been or will be prepared in connection with the Directed Share Issue. In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Regulation.
In the United Kingdom, this document and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, “qualified investors” (within the meaning of the United Kingdom version of the EU Prospectus Regulation (2017/1129/ EU) which is part of United Kingdom law by virtue of the European Union (Withdrawal) Act 2018) who are (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.
Forward-looking statements
This press release contains forward-looking statements that reflect the Company’s intentions, beliefs, or current expectations about and targets for the Company’s future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies and opportunities and the markets in which the Company operates. Forward-looking statements are statements that are not historical facts and may be identified by words such as “believe”, “expect”, “anticipate”, “intend”, “may”, “plan”, “estimate”, “will”, “should”, “could”, “aim” or “might”, or, in each case, their negative, or similar expressions. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurances that they will materialize or prove to be correct. Because these statements are based on assumptions or estimates and are subject to risks and uncertainties, the actual results or outcome could differ materially from those set out in the forward-looking statements as a result of many factors. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The Company does not guarantee that the assumptions underlying the forward-looking statements in this press release are free from errors and readers of this press release should not place undue reliance on the forward-looking statements in this press release. The information, opinions and forward-looking statements that are expressly or implicitly contained herein speak only as of its date and are subject to change without notice. Neither the Company nor anyone else undertake to review, update, confirm or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this press release, unless it is not required by law or Spotlight Stock Market’s rules.
Information to distributors
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended (“MiFID II”); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the “MiFID II Product Governance Requirements”), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any “manufacturer” (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the shares in The Company have been subject to a product approval process, which has determined that such shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the “EU Target Market Assessment”). Solely for the purposes of each manufacturer’s product approval process in the United Kingdom, the target market assessment in respect of the shares in the Company has led to the conclusion that: (i) the target market for such shares is only eligible counterparties, as defined in the FCA Handbook Conduct of Business Sourcebook, and professional clients, as defined in Regulation (EU) No 600/2014 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018 (“UK MiFIR“); and (ii) all channels for distribution of such shares to eligible counterparties and professional clients are appropriate (the “UK Target Market Assessment” and, together with the EU Target Market Assessment, the “Target Market Assessment”). Notwithstanding the Target Market Assessment, Distributors should note that: the price of the shares in the Company may decline and investors could lose all or part of their investment; the shares in the Company offer no guaranteed income and no capital protection; and an investment in the shares in the Company is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Directed Share Issue. Furthermore, it is noted that, notwithstanding the Target Market Assessment, ABG Sundal Collier will only procure investors who meet the criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II or UK MiFIR; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the shares in the Company.
Each distributor is responsible for undertaking its own target market assessment in respect of the shares in the Company and determining appropriate distribution channels.