Kongsberg Gruppen ASA (KONGSBERG) today entered into agreement with Rolls-Royce
plc to acquire Rolls-Royce Commercial Marine, a world leading technology
business within maritime operations. The acquisition will strengthen KONGSBERG's
competitiveness in a global maritime industry. KONGSBERG and Rolls-Royce
Commercial Marine are by and large complementary in terms of products, solutions
and competencies and the acquisition is in line with KONGSBERG's ambitions of
profitable growth as a global leading technology provider.
The transaction is structured as an acquisition by KONGSBERG of the marine
products, systems and aftermarket services businesses carried out by
subsidiaries of Rolls-Royce plc. The transaction does not include Bergen Engines
nor Rolls-Royce's Naval Business.
The parties have agreed a value for Rolls-Royce Commercial Marine of GBP 500
million (on a cash and debt free basis and with working capital at an agreed
level). The final purchase price, will be determined based on Rolls-Royce
Commercial Marine's cash, debt and working capital at time of completion of the
"The maritime industry has over the last years experienced demanding market
conditions and even though there is still uncertainty we expect the market to be
facing growth with technology and innovation being key drivers. For more than
200 years KONGSBERG has been a pioneer for high technology industrial
development with a long term perspective. The acquisition of Rolls-Royce
Commercial Marine is in line with our growth ambitions", says Eivind Reiten,
Chair of the Board of KONGSBERG.
"The acquisition of Rolls-Royce Commercial Marine makes us a more complete
supplier to the maritime industry. The maritime industry is becoming
increasingly globalized and is undergoing considerable technological and market
driven changes. With this acquisition we will strengthening our strategic
position with shipowners, shipyards and other customers and partners", says Geir
Håøy, CEO and President of KONGSBERG.
KONGSBERG is represented in more than 25 countries, whilst Rolls-Royce
Commercial Marine is represented in 34 countries. Rolls-Royce Commercial Marine
has approximately 3,600 employees and an annual turnover of NOK 8.9 billion
(2017), whilst KONGSBERG has approximately 7,000 employees and a turnover of NOK
14.5 billion (2017). Combined, the companies have equipment and deliveries
associated to around 30,000 vessels worldwide, and the installed base and the
global presence strengthens an already world leading position with a
Key financial figures and other information regarding Rolls-Royce Commercial
Marine is attached hereto as "Appendix 1".
"The acquisition strengthens our global presence and will give increased sales
and service volumes. KONGSBERG is a world leader within automation, navigation
and control systems, whilst Rolls-Royce Commercial Marine is complementary with
its deliveries of propellers, propulsion systems, handling systems and ship
design. Both companies hold leading positions within digitalization, ship
intelligence and concepts for autonomy. By bringing together this we are
positioning us as a significant strategic supplier of complete solutions for the
future maritime industry", says Håøy.
"This deal is good news for Rolls-Royce and KONGSBERG and comes at a time when
the maritime industry is at the dawn of a new and exciting era where digital and
electrical technologies will transform shipping. Rolls-Royce has been
responsible for leading many of those technological advancements, and with
combination of great people, market leading technology and a desire by KONGSBERG
to take this business to the next level, I'm sure that this business will
prosper in the years to come", says Mikael Makinen, Rolls-Royce President,
Rolls-Royce Commercial Marine has experienced considerable reductions in
activity levels due to challenging market conditions within offshore related
activity. A main priority going forward is ensuring profitability, and at the
same time being an industry innovation leader. The acquisition will also
strengthen Norwegian ownership in the world leading Norwegian maritime cluster,
whilst the company will have a stronger Nordic and international position.
Financing of the acquisition
KONGSBERG will finance the acquisition of Rolls-Royce Commercial Marine through
a combination of new equity and a new bond loan. The purchase price will be paid
in cash upon completion of the transaction.
The new equity will be raised through an underwritten rights issue of NOK 5.0
billion. The share capital increase is conditional upon approval by the by
KONGSBERG's general assembly with the support from at least two-thirds of the
votes. The Norwegian government has communicated that it is positive that the
state as an owner participates with its 50% ownership share in the rights issue,
pending Parliament consent and acceptable terms of the rights issue in line with
The remaining 50% of the rights issue is underwritten by a syndicate consisting
of DNB Markets, a part of DNB Bank ASA and Danske Bank A/S, Norwegian Branch and
certain larger pre-committing shareholders.
Shareholders now representing 19.7% of the shares have undertaken to vote in
favour of the rights issue at the KONGSBERG general meeting. Together with the
state, these shareholders represent 69.7% of the shares in the Company.
KONGSBERG is planning to issue a new bond loan. Nordea Bank AB (publ) filial i
Norge has undertaken to provide a bridge loan in the event that the bond loan
has not been issued prior to completion of the acquisition of Rolls-Royce
Condition and timetable
The completion of the acquisition of Rolls-Royce Commercial Marine is subject to
clearance by regulatory authorities in several jurisdictions.
KONGSBERG will publish an information memorandum with further information
regarding the acquisition of Rolls-Royce Commercial Marine within 30 business
The rights issue is expected to take place in the fourth quarter of 2018, and
KONGSBERG will issue a rights issue prospectus prior to the subscription period
for the rights issue.
Subject to such regulatory clearance, the acquisition of Rolls-Royce Commercial
Marine is expected to be completed in first quarter of 2019.
Invitation to investor and analyst presentation in Oslo
An investor and analyst presentation will be held by KONGSBERG's CEO and Chief
Financial Officer at 09:00 CET today at meeting room "Aker" in Vika Atrium,
Munkedamsveien 45, Oslo. The press is welcome. The presentation can also be
viewed live via webcast at:
Invitation to information meeting in Ålesund
An information meeting will be held by leader of Kongsberg Maritime at 11:30 CET
today at Norsk Maritimt Kompetansesenter, Ålesund. The press is also welcome.
Arctic Securities is acting as financial advisor. Thommessen is acting as legal
advisor. Arkwright and PWC is acting as due diligence advisor to KONGSBERG.
For further information, please contact:
Ronny Lie, VP Corporate Communication, Kongsberg Gruppen ASA, Tel.: (+47) 916 10
Jan Erik Hoff, VP Investor Relations, Kongsberg Gruppen ASA, Tel.: (+47) 991 11
KONGSBERG (OSE-ticker: KOG) is an international, knowledge-based group
delivering high technology systems and solutions to clients within the oil and
gas industry, merchant marine, defence and aerospace. KONGSBERG has 7 000
employees located in more than 25 countries and total revenues of NOK 14.5
billion in 2017. Follow us on Twitter: @kongsbergasa.
This detailed announcement has been prepared and published in accordance with
section 3.4 of the Continuing Obligations for Stock Exchange Listed Companies.
This information is subject to disclosure requirements pursuant to §5-12 of the
Norwegian Securities Trading Act.
This announcement is not an offer for sale of securities in the United States or
any other country. The securities referred to herein have not been registered
under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"),
and may not be sold in the United States absent registration or pursuant to an
exemption from registration under the U.S. Securities Act. The Company does not
intend to register any portion of the offering of the securities in the United
States or to conduct a public offering of the securities in the United States.
Any offering of securities will be made by means of a prospectus that may be
obtained from the Company when the subscription period commences and that will
contain detailed information about the Company and management, as well as
financial statements. Copies of this announcement are not being made and may not
be distributed or sent into the United States, Canada, Australia, Japan or any
other jurisdiction in which such distribution would be unlawful or would require
registration or other measures.
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"), this communication is only addressed to and is only directed at
qualified investors in that Member State within the meaning of the Prospectus
This announcement is only directed at (a) persons who are outside the United
Kingdom; or (b) investment professionals within the meaning of Article 19 of the
Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the
"Order"); or (c) persons falling within Article 49(2)(a) to (d) of the Order; or
(d) persons to whom any invitation or inducement to engage in investment
activity can be communicated in circumstances where Section 21(1) of the
Financial Services and Markets Act 2000 does not apply.
Certain statements included within this announcement contain forward-looking
information, including, without limitation, those relating to) forecasts,
projections and estimates, statements of management's plans, objectives and
strategies for the Company, such as planned expansions, investments or other
projects, management, as well as statements preceded by "expected", "scheduled",
"targeted", "planned", "proposed", "intended" or similar statements. Although
KONGSBERG believes that the expectations reflected in such forward-looking
statements are reasonable, these forward-looking statements are based on a
number of assumptions and forecasts that, by their nature, involve risk and
uncertainty. Various factors could cause our actual results to differ materially
from those projected in a forward-looking statement or affect the extent to
which a particular projection is realized.
No assurance can be given that such expectations will prove to have been
correct. KONGSBERG disclaims any obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
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