REC - SUCCESSFUL PRIVATE PLACEMENT ON REVISED T...

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REC - SUCCESSFUL PRIVATE PLACEMENT ON REVISED TERMS AND CONTEMPLATED SUBSEQUENT OFFERING

Sandvika, July 4, 2012

Reference is made to the stock exchange notices of June 22, 2012, June 27, 2012 and July 3, 2012. The board of directors (the "Board of Directors") of Renewable Energy Corporation ASA ("REC" or the "Company") has today resolved to withdraw the current notice of the extraordinary general meeting dated June 29, 2012 and make a revised proposal to the Company's extraordinary general meeting to be held on or about July 27, 2012 (the "EGM") consisting of i) an issue of a total of 866,666,667 new shares at a subscription price of NOK 1.50 per share, raising gross proceeds of NOK 1,300 million in a private placement (the "Private Placement") and ii) an authorisation to the Board of Directors to conduct a subsequent offering with gross proceeds of up to NOK 375 million to the existing shareholders of the Company as of July 3, 2012 who were not invited to participate in the Private Placement (the "Subsequent Offering"). This proposal replaces the previously proposed private placement, convertible bond refinancing and subsequent offering. The private placement was signifcantly oversubsribed.

"I am pleased with the new equity and the revised bank financing that are now in place, and grateful that shareholders continue to show us support in what is a demanding time both within the solar industry and in the financial markets. The combination of a solid balance sheet and a strong market- and cost position gives us financial sustainability in a situation where our industry is under severe pressure", says Ole Enger CEO.

The subscription price in the Private Placement was determined by the Board of Directors based on a bookbuilding process conducted by Arctic Securities ASA (Coordinator), DNB Markets, a part of DNB Bank ASA and Nordea Markets, a part of Nordea Bank Norge ASA, who act as joint lead managers and bookrunners for the Private Placement (collectively, the "Managers").

The proceeds from the Private Placement and the Subsequent Offering will be used for investments related to sustaining a leading industry position, strengthening of the balance sheet and general corporate purposes.

The subscribers will be notified of their conditional allocation today.

The following primary insiders were allocated new shares in the Private Placement:

1. Umoe AS (controlled and represented on the Board of Directors by the Chairman of the Board of Directors Jens Ulltveit-Moe) was allocated 186,666,666 new shares. Umoe AS currently holds 59,497,211 shares and will hold 246,163,877 shares after completion of the Private Placement. 

2. Orkla ASA was allocated 133,333,333 new shares. Orkla ASA currently holds 396,236,635 shares and will hold 529,569,968 shares after completion of the Private Placement. 

3. Canica AS (represented on the Board of Directors by board member Peter Ruzicka) was allocated 76,666,666 new shares. Canica AS currently holds 0 shares and will hold 76,666,666 shares after completion of the Private Placement. 

The members of the Board of Directors and REC group management (primary insiders) were not given the opportunity to participate in the Private Placement.

The completion of the Private Placement is conditional upon the following conditions being satisfied by August 17, 2012:

1. the corporate resolutions of the Board of Directors and the EGM required to implement the Private Placement and the Subsequent Offering being validly made; 

2. registration of the share capital increase in the Company pertaining to the Private Placement with the Norwegian Register of Business Enterprises; and 

3. the Bank Debt Refinancing (as defined below) being completed, subject only to completion of the Private Placement and customary conditions precedent for such bank financing. 

The settlement of the Private Placement is expected to take place on or around July 30, 2012. In the event that the prospectus for listing of the new shares in the Private Placement is not approved by the Financial Supervisory Authority of Norway and published upon issuance of the new shares, the new shares will be assigned a separate securities number (ISIN) and will not be listed or tradable on Oslo Børs pending approval and publication of such prospectus. The prospectus is expected to be published as soon as it is approved by the Financial Supervisory Authority of Norway.

Following the registration of the share capital increase pertaining to the Private Placement with the Norwegian Register of Business Enterprises, the Company will have an issued share capital of NOK 1,863,748,785, divided into 1,863,748,785 shares, each with a nominal value of NOK 1.00.

The Refinancing

In conjunction with the Private Placement, the Board of Directors has undertaken to:

1. refinance the Company's bank debt facilities into a new NOK 2,000 million bank debt facility with maturity in April 2014 (the "Bank Debt Refinancing"); and 

2. subject to completion of the Private Placement, the Company will propose to the EGM that the EGM authorises the Board of Directors to conduct the Subsequent Offering (together with the Bank Debt Refinancing and the Private Placement, the "Refinancing") with gross proceeds of up to NOK 375 million to the existing shareholders of the Company as of July 3, 2012 who were not invited to participate in the Private Placement. 

Arctic Securities ASA has been engaged as financial advisor to the Company in relation to the Refinancing.

The Subsequent Offering

The Subsequent Offering will be directed towards existing shareholders of the Company as of July 3, 2012 (as documented by the shareholders' register in the Norwegian Central Securities Depository (the "VPS") as of July 6, 2012), who were not invited to participate in the Private Placement. Such existing shareholders will be granted non-tradable subscription rights that provide right to subscribe for, and be allocated, subject to applicable securities laws, shares in the Subsequent Offering. Over-subscription will be allowed, but no shareholder will be allocated more shares than required to maintain its relative ownership in the Company as of July 3, 2012. There can be no assurance that shares will be allocated based on over-subscription.

The subscription price in the Subsequent Offering will be NOK 1.50 per share, and the number of shares offered will hence be 250 million. The subscription period for the Subsequent Offering is expected to commence in August/September 2012. The Subsequent Offering is conditional upon completion of the Private Placement and hence also on satisfaction of the conditions for the completion of the Private Placement.

Please see attached presentation material.

For further information, please visit www.recgroup.com/refinancing2012 or contact:

Bjørn Brenna, EVP & CFO, phone: [phone]
Mikkel Tørud, VP & IRO, phone: [phone]

About REC

REC is a leading vertically integrated solar energy company. REC produces polysilicon, wafers, cells and modules for the solar industry, and silicon materials for the electronic industry. REC also engages in project development in selected PV segments. Founded in Norway in 1996, REC employs around 3,200 people globally with revenues of more than EUR 1.7 billion in 2011, approximately USD 2.4 billion. Please visit www.recgroup.com to learn more about REC.

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Important notice:

This announcement is not an offer for sale of securities in the United States or any other country in which such offer would be unlawful or would require prospectus, registration or other measures. The securities referred to herein have not been registered under the United States 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. REC 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. Copies of this announcement are not being made and may not be distributed or sent into the United States, Canada, Australia, Hong Kong, Japan or any other jurisdiction in which such distribution would be unlawful or would require registration or other measures.

In any Member State of the European Economic Area 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 Directive.

This announcement is only directed at (a) persons who are outside the United Kingdom; or (b) investment professionals within the meaning of Article 19(5) 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) ("high net worth companies, unincorporated associations, etc.") 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 and its appendix contain forward-looking information, including, without limitation, those relating to (a) forecasts, projections and estimates, (b) statements of management's plans, objectives and strategies for REC, such as planned expansions, investments or other projects, (c) costs, capacities or rates, start-up costs, cost reductions and profit objectives, (d) various expectations about future developments in REC's markets, particularly prices, supply and demand and competition, (e) results of operations, (f) margins, (g) growth rates, (h) risk management, as well as (i) statements preceded by "expected", "scheduled", "targeted", "planned", "proposed", "intended" or similar statements. Although we believe 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. REC disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

Investor Presentation

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Source: Renewable Energy Corporation ASA via Thomson Reuters ONE

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