3i to realise £76m in Eltel's IPO
3i Group plc (“3i”) is pleased to report that Eltel AB (publ) (“Eltel” or “the Company”), a leading European provider of technical services to the Infranet industry, has announced the outcome of the Initial Public Offering (“IPO” or “Offering”) of its shares and listing on Nasdaq Stockholm.
NOT FOR DISTRIBUTION OR RELEASE, DIRECTLY OR INDIRECTLY, TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN, OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL
The Offering comprises 36.7 million shares, including 17.2 million from Eltel’s existing shareholders (with key shareholders 3i and funds managed by 3i as well as BNP Paribas holding 62.6% and 29.5% of the Company’s shares prior to the Offering, respectively). The shares were offered at SEK 68 per share, raising SEK 2,493 million, implying a market capitalisation of SEK 4,258 million.
As part of this Offering, 3i and managed funds are reducing their stake in Eltel from 62.6% to 25.2%. Furthermore, Eltel will refinance, inter alia, senior loans held by 3i and funds managed by 3i.
Total gross proceeds to 3i Group plc amount to approximately £76 million and, at the offering price, 3i Group plc's remaining 14.3% stake is worth approximately £49 million. Together this represents a £55 million uplift over the 31 March 2014 valuation of £70 million.
The Offering has an over-allotment of up to 5.5 million additional shares, of which 3i and managed funds have agreed to sell up to 3.3 million shares.
The closing of the Offering is expected to occur on 10 February 2015.
3i, and funds managed by 3i, acquired a majority stake in Eltel in 2007. The investment followed a highly acquisitive period for the Company and 3i has worked closely with the management team to successfully integrate the acquisitions and streamline the organisational structure. Under 3i’s ownership, the Company has implemented the “Eltel Way”, a business service operating model, to provide uniform service throughout the organisation. The “Eltel Way” has changed the Company from a geographically focused business into a global organisation, with specialised international business units including technicians who provide cross border solutions.
Eltel has grown significantly during 3i’s ownership; the Company has increased its sales significantly and improved its margins, with the Company generating €1,154 million of net sales in 2013. It has also consolidated its leading position in its core markets of Finland, Sweden, Norway, the Baltic region and Poland and also entered new markets including expansion in Germany and into the United Kingdom. This growth has been supported by the completion of 16 acquisitions, larger outsourcing deals and Joint Venture formations.
Fredrik Karlsson, Partner and co-head of the Nordic region, 3i Group, commented:
“Eltel has demonstrated significant growth under our ownership developing into an industry leading Infranet services company. The Company has strengthened its leadership position in its core markets and expanded internationally into Germany and the United Kingdom. We are proud to have supported Eltel’s management team during this transformational period and are confident in their continued success.”
Axel Hjärne, CEO of Eltel, said:
“As a result of more than a decade of hard work, Eltel has grown into a leading European player in the Infranet industry today, and we will continue to build on this position. With a specialized service offering, a strong customer base and a dedicated workforce in place, we are focused on achieving further growth in both our core and new markets, as well as maintaining our trend of increased profitability. As a management team, we are determined to take Eltel to the next level of its development. The listing on Nasdaq Stockholm brings multiple benefits and is a natural step in the evolution of the Company.”
For further information, contact:
Kathryn van der Kroft
Tel: +44 20 7975 3021
Tel: +46 70 653 00 93
Notes to editors:
About 3i Group
3i is a leading international investment manager focused on mid-market private equity, infrastructure and debt management across Europe, Asia and North America. For further information, please visit: www.3i.com.
Eltel is a leading European provider of technical services to the Infranet industry, which consist of companies that own and operate critical infrastructure networks in the areas of Power, Communication and Transport & Defence. Eltel offers services related to construction, installation, maintenance and operation of critical infrastructure to its blue-chip customer base. Eltel mainly operates throughout the Nordic and Baltic regions, Poland, Germany, the United Kingdom and Africa.
This transaction involved a recommendation of 3i Investments plc, advised by 3i Sweden.
This announcement is not and does not form a part of any offer for sale of securities.
Copies of this announcement are not being made and may not be distributed or sent into the United States, Australia, Canada, Japan or any other jurisdiction in which such distribution would be unlawful or would require registration or other measures.
The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and accordingly may not be offered or sold in the United States absent registration or an exemption from the registration requirements of the Securities Act and in accordance with applicable U.S. state securities laws. There is no intention to register any part of the offering in the United States or to conduct a public offering of securities in the United States.
Any offering of the securities referred to in this announcement is being made by means of a prospectus. This announcement is not a prospectus for the purposes of Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the “Prospectus Directive”). Investors should not subscribe for any securities referred to in this announcement except on the basis of information contained in the aforementioned prospectus.
In any EEA Member State other than Sweden that has implemented the Prospectus Directive, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State.
This communication is only being distributed to and is only directed at persons in the United Kingdom that are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) or (ii) high net worth entities, and other persons to whom this announcement 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”). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.
Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as “believe,” “expect,” “anticipate,” “intends,” “estimate,” “will,” “may,” "continue," “should” and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although 3i believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors, which are difficult or impossible to predict and are beyond its control. 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 information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice.