Nets A/S: Nets publishes Offering Circular and the indicative price range for its intended IPO

NOT FOR RELEASE OR DISTRIBUTION OR PUBLICATION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN
This announcement does not constitute an offering circular and nothing herein contains an offering of securities. No one should purchase or subscribe for any securities in Nets A/S (the “Company”) except on the basis of information in the offering circular published by the Company in connection with the offering and admission of such securities to trading and official listing on Nasdaq Copenhagen A/S (“Nasdaq Copenhagen”). Copies of the offering circular are available at the Company's registered office and, subject to certain exceptions, through the website of the Company.

Nets publishes Offering Circular and the indicative price range for its intended IPO

Nets, a leading provider of digital payment services and related technology solutions across the Nordic region, today has published an Offering Circular and the indicative price range in connection with its intended initial public offering (“IPO” or the “Offering”) and subsequent admission to trading in and official listing of its shares on Nasdaq Copenhagen.

Highlights

• Indicative offer price range of DKK 130 to DKK 160 per share of nominal value DKK 1 each
• Implied market capitalisation of DKK 26 billion to DKK 32 billion after the issuance of new shares in the Offering.
• The Offering comprises:
  • up to 42,307,693 new shares to be issued by the Company, which would generate gross proceeds of approximately DKK 5.5 billion,
  • a partial sell-down of 37,692,307 to 70,625,000 existing shares by Nets' current shareholders, excluding any shares subject to the overallotment option.
  • an overallotment option of up to 15,750,000 shares has been granted to the managers by certain of Nets' current shareholders
• The Offering is expected to result in a free float between 40% and 60% of Nets A/S share capital after completion of the Offering
• Offer period from 13 September 2016 to 26 September at 11 a.m. CET, but may be closed in whole or in part at the earliest on 22 September 2016 at 00:01 a.m. CET
• Offer price to be announced and first day of admission and trading on Nasdaq Copenhagen on 27 September 2016 unless moved forward if the offer period is closed before 26 September 2016

The intended IPO of Nets marks the next stage in the Company's development, following a period of transformation and building on the platform of the previous owners. Over the past two years, Nets has been repositioned through a combination of operational improvements and over DKK 3.9 billion of investment in IT, existing and new products, and seven strategic acquisitions, transforming Nets into a growth business. Nets sits at the centre of the Nordics digital payments ecosystem and operates a deeply entrenched network that connects merchants, corporate customers, financial institutions and consumers. Its innovative and highly scalable platform, robust financial profile and multiple drivers for future growth all put Nets in a strong position to deliver long-term sustainable value for its current and prospective shareholders.

The Offering is expected to support Nets' operational strategy, advance the Company's public and commercial profile, and provide it with improved access to public capital markets and a diversified base of new Danish and international shareholders. Nets plans to use the proceeds it receives from the Offering, together with amounts drawn under a new banking facilities agreement to be put in place subject to the IPO and potentially also existing cash, to repay existing debt in the Nets group.

Bo Nilsson, CEO of Nets, said:

“I am delighted with the response we have received to the announcement of our intention to float, both from potential investors and other stakeholders. There is clearly a real appreciation of the transformation Nets has undergone in the past two years, with the Company emerging as a highly commercial, customer-centric, innovative leader in the fast-growing digital payments space. There is also an understanding of the well-diversified position Nets has built at the heart of the Nordics payments ecosystem over many years, providing us with a number of exciting opportunities for future growth within the world's most digitised societies. I am proud of what everyone at Nets has achieved, and we look forward to building on our track record of success, continuing to deliver more new products and services for our customers and value for our shareholders.”

Details of the Offering

The Offering comprises between 34,375,000 and 42,307,693 new shares to be issued by the Company, such as would result in gross proceeds of approximately DKK 5.5 billion, and a partial sell-down of between 37,692,307 and 70,625,000 existing shares by the Selling Shareholders (the new shares and the existing shares comprised by the Offering are jointly referred to as the “Offer Shares”), excluding any shares subject to the overallotment option.

The Nets group's current shareholders include certain funds managed by Advent International Corporation (the “Advent Funds”) (43.0%) and certain funds advised by Bain Capital Private Equity (Europe) L.L.P. (the “Bain Capital Funds”) (43.0%) through a joint holding company established for the IPO, AB Toscana (Luxembourg) Investment S.à r.l. (the “Significant Shareholder”); ATP through ATP Private Equity Partners IV K/S and Via Venture Partners Fond II K/S (jointly referred to as “ATP Investment Vehicles”) (5.0%); members of Nets' management through eInvestments af 23. marts 2014 ApS (“eInvestments”) (8.6%); and the NH Fintech ApS indirectly controlled by the Nets CEO and his related parties (“NH Fintech”) (0.4%).^[1]

The Significant Shareholder, ATP Investment Vehicles, eInvestments and NH Fintech are jointly referred to as the “Selling Shareholders”.

In addition, the Offering includes an overallotment option of 15,750,000 additional shares granted by the Significant Shareholder, the ATP Investment Vehicles and NH Fintech (pro rata to their sale of existing Offer Shares), representing up to 15% of the Offer Shares. The overallotment option is exercisable in whole or in part until 30 calendar days after the first day of trading and official listing on Nasdaq Copenhagen.

The offer price will be determined through a book-building process and is expected to be announced, together with the final number of Offer Shares sold in the Offering through Nasdaq Copenhagen no later than 8:00 a.m. CET on 27 September 2016.

The offer period will commence on 13 September 2016 and will close no later than 11:00 a.m. CET on 26 September 2016, but may be closed in whole or in part at the earliest on  22 September 2016 at 00:01 a.m. CET. The offer period in respect of applications for purchases of amounts up to, and including, DKK 3 million may be closed before the remainder of the Offering is closed. Any such earlier closing in whole or in part will be published through Nasdaq Copenhagen.

Payment for and settlement of the Offer Shares are expected to take place on or around 29 September 2016 (the “Settlement Date”) by way of delivery of temporary purchase certificates under the temporary ISIN DK0060745453 (the “Temporary Purchase Certificates”) against payment in immediately available funds in Danish kroner in book-entry form to investors' accounts with VP SECURITIES A/S (“VP Securities”) and through the facilities of Euroclear Bank S.A./N.A., as operator of the Euroclear System (“Euroclear”) and Clearstream Banking, S.A. (“Clearstream”). Subject to completion of the Offering and registration of the new Offer Shares with the Danish Business Authority, the Temporary Purchase Certificates will automatically be exchanged in VP Securities for a corresponding number of shares in the Company (“Shares”), which are expected to be delivered two business days after the Settlement Date under the permanent ISIN DK0060745370 in book-entry form to the holder of the Temporary Purchase Certificates' account with VP Securities and through the facilities of Euroclear and Clearstream.

Prior to the Offering, there has been no public market for the Temporary Purchase Certificates or the Company's Shares. Application has been made for the Temporary Purchase Certificates to be admitted to trading on Nasdaq Copenhagen (the “Admission”) under the symbol “NETS TEMP” and for the Shares to be admitted to trading and official listing on Nasdaq Copenhagen under the symbol “NETS”.

The Admission is subject to, among other things, completion of the IPO reorganisation (described below), Nasdaq Copenhagen's approval of the distribution of the Offer Shares, the Offering not being withdrawn prior to the settlement of the Offering and the Company making an announcement to that effect.

The first day of trading and official listing on Nasdaq Copenhagen is expected to be 27 September 2016 subject to the Offering not being withdrawn prior to settlement and completion of the Offering or
accelerated. The first day of trading of the Temporary Purchase Certificates on Nasdaq Copenhagen is expected to be 27 September 2016 and the last day of trading of the Temporary Purchase Certificates on Nasdaq Copenhagen is expected to be 29 September 2016. The first day of trading of the Shares on Nasdaq Copenhagen under the permanent ISIN is expected to be 30 September 2016. In connection with the Temporary Purchase Certificates being automatically exchanged for Shares, the Temporary Purchase Certificates will cease to exist.

If the Offering is terminated or withdrawn: the Offering and any associated arrangements will lapse, all submitted orders will be automatically cancelled, any monies received in respect of the Offering will be returned to the investors without interest (less any transaction costs) and admission to trading and/or official listing of the Temporary Purchase Certificates or the Shares on Nasdaq Copenhagen will be cancelled. Consequently, any trades in the Temporary Purchase Certificates or the Shares effected on or off the market before settlement of the Offering may subject investors to liability for not being able to deliver the Temporary Purchase Certificates and/or the Shares sold and investors who have sold or acquired Temporary Purchase Certificates and/or Shares on or off the market may incur a loss. All dealings in the Temporary Purchase Certificates and/or Offer Shares prior to settlement of the Offering are for the account of, and at the sole risk of, the parties concerned.

The Offering includes an initial public offering in Denmark to institutional and retail investors, a private placement in the United States only to persons who are qualified institutional buyers or QIBs in reliance on Rule 144A under the U.S. Securities Act; and private placements to institutional investors in the rest of the world in compliance with Regulation S under the U.S. Securities Act.

Offering Circulars

An English language Offering Circular and a Danish translation thereof (together, the “Offering Circulars”) have been prepared. Special attention should be given to the risk factors that are described in the beginning of the Offering Circulars.

The Offering Circular will be made available to eligible investors at no cost at the registered office of Nets, Lautrupbjerg 10, DK-2750 Ballerup. The Offering Circular can also be obtained upon request from Nordea Bank Danmark A/S, Asset Services Global DK, PO Box 850, 0900 Copenhagen C, Denmark, phone: +45 55 47 53 38, e-mail: prospekt.ca@nordea.com or Danske Bank A/S, Holmens Kanal 2-12, 1092 Copenhagen K, Denmark, phone: +45 70 23 08 34, e-mail: prospekter@danskebank.dk, and can be requested through Nordea's and Danske Bank's branches in Denmark. The Offering Circular is also available to eligible persons on the Nets website, www.nets.eu.

IPO Reorganisation

Nets A/S has been formed for the purpose of being admitted to trading and official listing on Nasdaq Copenhagen as the parent company of the Nets group by acquiring Nassa Topco AS, the current parent holding company of the Nets operating group, pursuant to an IPO reorganisation, which will be carried out in connection with the IPO. Nets A/S does not currently have any material assets or liabilities and does not conduct any operating activities prior to the effectiveness of the IPO reorganisation and there are no financial statements reflecting the operations of the business conducted by the Company. Accordingly, the financial results included in the Offering Circular relate to consolidated historical financial information of Nassa Topco AS, which reflects the operations of the Nets group, and which is contemplated to be acquired by the Company upon completion of the IPO reorganisation.

Bank syndicate and advisors

Deutsche Bank, Morgan Stanley and Nordea have been appointed to act as Joint Global Co-ordinators and Joint Bookrunners for the intended IPO. Danske Bank, DNB Markets, JPMorgan and UBS Investment Bank have been appointed to act as Joint Bookrunners. Carnegie, OP Corporate Bank, SEB, SpareBank 1 Markets and Sydbank Markets have been appointed to act as Co-Lead Managers. Lazard & Co. Limited is acting as financial advisor to Nets.

- Ends -

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Important notice

This announcement is not an offer to sell or a solicitation of any offer to buy any securities issued by Nets A/S (the “Company”) in any jurisdiction where such offer or sale would be unlawful and the announcement and the information contained herein are not for distribution or release, directly or indirectly, in or into such jurisdictions.

This announcement and the information contained herein are not for distribution in or into the United States of America. This document does not constitute, or form part of, an offer to sell, or a solicitation of an offer to purchase, any securities in the United States. The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”) and may not be offered or sold within the United States absent registration or pursuant to an 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. Any securities sold in the United States will be sold only to qualified institutional buyers (as defined in Rule 144A under the Securities Act) in reliance on Rule 144A.

In any member state of the European Economic Area (“EEA Member State”), other than Denmark, that has implemented Directive 2003/71/EC as amended (together with any applicable implementing measures in any member State, the “Prospectus Directive”), this communication is only addressed to and is only directed at investors in that EEA Member State who fulfil the criteria for exemption from the obligation to publish an offering memorandum, including qualified investors, within the meaning of the Prospectus Directive as implemented in each such EEA Member State.

This announcement 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 U.K. Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high net worth entities falling within Article 49(2)(a) - (d) of the Order (the persons described in (i) through (iii) above 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.

This announcement does not constitute an offering memorandum and nothing herein contains an offering of securities. No one should purchase or subscribe for any securities in the Company, except on the basis of information in the Offering Circular published by the Company in connection with the offering and admission of such securities to trading and official listing on Nasdaq Copenhagen A/S. Copies of the Offering Circular are available from the Company's registered office and, subject to certain exceptions, on the website of the Company.

Deutsche Bank AG, London Branch, Morgan Stanley & Co. International plc and Nordea Markets (a division of Nordea Bank Danmark A/S) (together, the “Joint Global Coordinators”), Danske Bank A/S, DNB Markets, a part of DNB Bank ASA, J.P. Morgan Securities plc and UBS Limited (collectively, and together with the Joint Global Coordinators, the “Joint Bookrunners”), Carnegie Investment Bank, filial af Carnegie Investment Bank AB (publ), Sverige, OP Corporate Bank plc, Skandinaviska Enskilda Banken, Danmark, filial af Skandinaviska Enskilda Banken AB (publ), Sverige, SpareBank 1 Markets AS and Sydbank A/S (together, the “Co-Lead Managers” and together with the Joint Global Coordinators and the Joint Bookrunners, the “Managers”) and their affiliates are acting exclusively for the Company and the selling shareholders and no-one else in connection with the offering. They will not regard any other person as their respective clients in relation to the offering and will not be responsible to anyone other than the Company and the selling shareholders for providing the protections afforded to their respective clients, nor for providing advice in relation to the offering, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

In connection with the offering, the Managers and any of their affiliates, acting as investors for their own accounts, may subscribe for or purchase shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such shares and other securities of the Company or related instruments in connection with the offering or otherwise. Accordingly, references in the Offering Circular to the shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, such Managers and any of their affiliates acting as investors for their own accounts. The Managers do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so. 

In connection with the offering, Deutsche Bank AG, London Branch (the “Stabilising Manager”) (or persons acting on behalf of the Stabilising Manager) may over-allot securities or effect transactions with a view to supporting the market price of the securities at a level higher than that which might otherwise prevail.  However, there is no assurance that the Stabilising Manager (or persons acting on behalf of the Stabilising Manager) will undertake stabilisation.  Any stabilisation action may begin on or after the date of commencement of trading and official listing of the securities on  Nasdaq Copenhagen A/S and, if begun, may be ended at any time, but it must end no later than 30 days after the date of commencement of trading and official listing of the securities.

Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and that can be identified by words such as “believe”, “expect”, “anticipate”, “intends”, “estimate”, “will”, “may”, “continue”, “should”, and similar expressions. The forward-looking statements in this announcement are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company 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 that 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.

^[1] The stated ownership stakes are before the completion of the Offering and assumes an offer price at the midpoint of the offer price range and represent indicative approximations of the beneficial ownership in Nets A/S  pre-IPO and after a reorganisation of the Nets' group structure to be carried out in connection with an IPO. The shareholders have invested in different Nets entities and the exact ownership stakes in Nets A/S after the reorganisation will ultimately depend on, among other things, the final offer price.