SRV considers the issuance of New Capital Notes...

SRV GROUP PLC     INSIDE INFORMATION       2 MAY 2019, AT 11:00 EET

SRV considers the issuance of New Capital Notes and announces Voluntary Tender Offers for its outstanding Capital Notes issued in 2016 and Senior Notes due March 2021

Not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States, Australia, Canada, Hong Kong, Japan, Singapore or any other countries or otherwise in such circumstances in which the release, publication or distribution would be unlawful.

SRV Group Plc (“SRV”) is considering issuance of new euro-denominated capital notes in the amount of EUR 45-60 million (the “New Notes”). The issuance of New Notes may take place in the near future, subject to market conditions.

In addition, SRV Group Plc (the “Offeror”) invites today the holders of the EUR 45 million 8.875 percent notes issued on 22 March 2016 (ISIN: FI40004198114) (the “2016 Capital Notes”) and the holders of the EUR 100 million 6.875 percent notes due on 23 March 2021 (ISIN: FI4000198122) (the “2021 Notes” and together with the 2016 Capital Notes, the “Notes”) issued by SRV, to tender their Notes for cash on the terms and conditions set out in the tender offer memorandum dated 2 May 2019 (the “Tender Offer Memorandum”) (the “Tender Offer”).

The Offeror proposes to accept for purchase a maximum aggregate principal amount of Notes validly tendered in the Tender Offer of up to EUR 70 million. The Offeror however reserves the right, in its sole discretion, to decide on the 2016 Capital Notes final acceptance amount and the 2021 Notes final acceptance amount, including not to accept any purchase of the Notes. If the Offeror decides to accept for purchase 2016 Capital Notes or 2021 Notes, and the aggregate principal amount of relevant Notes validly tendered pursuant to the Tender Offer is more than the relevant final acceptance amount, the Offeror intends to accept such Notes for purchase on a pro rata basis.

The purchase price of the Notes will be determined pursuant to a modified Dutch auction procedure, as described in the Tender Offer Memorandum. The 2016 Capital Notes minimum offer price is 102.50% and the 2021 Notes minimum offer price is 100.50%. Tendering holders may choose to accept the relevant minimum offer price or to specify a higher price acceptable to them. After the tender period, the Offeror will decide and communicate the final acceptance amount of 2016 Capital Notes and 2021 Notes as well as the final purchase price of 2016 Capital Notes and 2021 Notes. All Notes validly tendered at prices equal to or lower than the relevant Purchase Price will be accepted for purchase, subject to any potential pro rata adjustment. Accrued and unpaid interest will be paid in respect of all the Notes validly tendered and delivered and accepted for purchase.

The completion of the Tender Offer is subject to, without limitation, the pricing and completion of the issue of the New Notes.

The offer period commences on 2 May 2019 and closes at 4:00 p.m. Finnish time (EET) on 15 May 2019. The indicative tender offer results will be announced on or about 16 May 2019, and the final tender offer results and completion date will be announced as soon as feasible, but no later than 23 May 2019. The settlement date of the Tender Offer will in no case be later than 31 May 2019, subject to the completion of the issue of the New Notes.

A holder that wishes to subscribe for New Notes in addition to tendering the Notes for cash pursuant to the Tender Offer may receive priority in the allocation of the New Notes (the “New Issue Allocation”). The New Issue Allocation may be given for an aggregate nominal amount of New Notes up to the aggregate nominal amount of 2016 Capital Notes or 2021 Notes subject to a holder’s valid tender instruction (subject to potential proration), where an allocation of the New Notes is also requested. Such tender instruction must relate to a minimum of EUR 100,000 in aggregate nominal amount of 2016 Capital Notes or 2021 Notes. To be eligible to receive a New Issue Allocation, a holder must request a unique allocation code from the Dealer Manager. If any holder wishes to subscribe for New Notes, it must make an application to subscribe for such New Notes to the lead manager of the issue of the New Notes. OP Corporate Bank plc acts as lead manager for the issue of the New Notes. 

OP Corporate Bank plc acts as dealer manager and tender agent for the Tender Offer. A copy of the Tender Offer Memorandum and information in respect of the Tender Offer may be obtained by qualifying holders from OP Corporate Bank plc: email: [e-mail] / tel. [phone]. 

For further information, please contact:
Juha Pekka Ojala, President and CEO, tel. [phone], [e-mail] 
Ilkka Pitkänen, CFO, tel. [phone], [e-mail] 
Maija Karhusaari, Senior Vice President, Communications and Marketing, tel. [phone], [e-mail] 

www.srv.fi   

IMPORTANT INFORMATION

This announcement must be read in conjunction with the Tender Offer Memorandum, which may be obtained from OP Corporate Bank plc by, and is only available to, qualifying noteholders. This announcement and the Tender Offer Memorandum contain important information that should be read by the qualifying noteholders carefully before any decision is made with respect to the Tender Offer. If any holder is in any doubt as to the contents of this announcement or the Tender Offer Memorandum or the action it should take, it is recommended to seek its own financial and legal advice, including in respect of any tax consequences, from its broker, bank manager, solicitor, accountant or other independent financial, tax or legal adviser. Neither the Dealer Manager nor the Offeror makes any recommendation whether holders should tender Notes pursuant to the Tender Offer.

None of the Offeror or any of its directors, officers, employees, agents or affiliates assumes any responsibility for the accuracy or completeness of the information concerning SRV, the Notes or the Tender Offer contained in this announcement or in the Tender Offer Memorandum. None of the Offeror or any of its directors, officers, employees, agents or affiliates is acting for any holder or will be responsible to any holders for providing the protections afforded to its clients or for advising any other person in connection with the Tender Offer.

MiFID II product governance / Professional Investors, ECPs and retail clients target market

Solely for the purposes of the manufacturer’s product approval process, the target market assessment in respect of the New Notes has led to the conclusion that:

1) the target market for the New Notes is:

(a) eligible counterparties, professional clients and retail clients, each as defined in Directive 2014/65/EU (as amended, “MiFID II”);

(b) informed investors, having average knowledge of relevant financial products (an informed investor can make an informed investment decision based on the regulated and authorised offering documentation, together with knowledge and understanding of the specific factors/risks highlighted with them only) and advanced investors, having one, or more, of the following characteristics; (i) good knowledge of relevant financial products and transactions, or (ii) financial industry experience or accompanied by professional investment advice or included in a discretionary portfolio service;

(c) clients that have the ability to bear losses of up to 100% of the capital invested in the product, and who have a high risk tolerance and therefore do not need a fully guaranteed income or return profile;

(d) clients whose investment objective is to generate growth of the invested capital and have a medium- to long-term investment horizon.

2) all channels for distribution of the New Notes to eligible counterparties and professional clients are appropriate; and

3) the following channels for distribution of the New Notes to retail clients are appropriate: investment advice, portfolio management and non-advised sales or execution with appropriateness test, subject to the distributor’s suitability and appropriateness obligations under MiFID II, as applicable.

Any person subsequently offering, selling or recommending the New Notes (a “distributor”) should take into consideration the manufacturer’s target market assessment; however, a distributor subject to MiFID II is responsible for undertaking its own target market assessment in respect of the New Notes (by either adopting or refining the manufacturers’ target market assessment) and determining appropriate distribution channels. OP Corporate Bank plc is the manufacturer of the New Notes for the purposes of MiFID II product governance rules.

Offer and Distribution Restrictions

The information contained herein is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States, Australia, Canada, Hong Kong, Japan, Singapore or any other countries or otherwise in such circumstances in which the release, publication or distribution would be unlawful. The information contained herein does not constitute an invitation to participate in the Tender Offer, or an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, the New Notes in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Persons into whose possession this announcement may come are required to inform themselves of and observe all such restrictions. None of SRV and OP Corporate Bank plc or their respective representatives accept any legal responsibility for any violation by any person, whether or not the persons contemplating investing in or divesting SRV’s securities, including the New Notes, are aware of such restrictions.

United States

The Tender Offer is not being made, and will not be made, directly or indirectly in or into, and cannot be accepted, directly or indirectly, from, or by use of the mails of, or by any means or instrumentality of interstate or foreign commerce of or of any facilities of a national securities exchange of, the United States or to any U.S. Person (as defined in Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”) (each a “U.S. Person”)). This includes, but is not limited to, facsimile transmission, electronic mail, telex, telephone, the internet and other forms of electronic communication. The Notes may not be tendered in the Tender Offer by any such use, means, instrumentality or facility from or within the United States or by persons located or resident in the United States or by, or by any person acting for the account or benefit of, a U.S. Person. Accordingly, copies of the Tender Offer Memorandum and any other documents or materials relating to the Tender Offer are not being, and must not be, directly or indirectly mailed or otherwise sent, transmitted, distributed or forwarded (including, without limitation, by custodians, nominees, trustees or agents) in, into or from the United States or to any persons located or resident in the United States or to any U.S. Person and persons receiving the Tender Offer Memorandum must not mail, send, transmit, distribute or forward it or any other documents or materials relating to the Tender Offer in, into or from the United States. Any person accepting the Tender Offer shall be deemed to represent to the Offeror such person’s compliance with these restrictions. Any purported acceptance of Notes in the Tender Offer resulting directly or indirectly from a breach or violation of these restrictions will be invalid and any purported tender of Notes made by, or by any person acting for the account or benefit of, a U.S. Person or by a person located in the United States or any agent, fiduciary or other intermediary acting on a nondiscretionary basis for a principal giving instructions from within the United States will be invalid and will not be accepted.

Each holder of Notes participating in the Tender Offer will represent that it is not a U.S. Person, it is not located in the United States and is not participating in the Tender Offer from the United States, or it is acting on a non-discretionary basis for a principal located outside the United States that is not giving an order to participate in the Tender Offer from the United States and is not a U.S. Person.

This announcement does not constitute an offer of securities for sale in the United States. The New Notes have not been and will not be registered under the Securities Act or under the applicable securities laws of any state of the United States and may not be offered or sold, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. persons except pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

United Kingdom

The communication of this announcement, the Tender Offer Memorandum and any other documents or materials relating to the Tender Offer is not being made, and such documents and/or materials have not been approved, by an authorised person for the purposes of section 21 of the Financial Services and Markets Act 2000, as amended. Furthermore, this announcement does not constitute an offer of New Notes to the public in the United Kingdom. No prospectus has been or will be approved in the United Kingdom in respect of the New Notes. Accordingly, such documents and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of such documents and/or materials as a financial promotion may only be distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons in (i), (ii) and (iii) above together being referred to as “Relevant Persons”). 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 such documents and/or materials or any of their contents.

European Economic Area (including Finland)

This announcement has been prepared on the basis that any offers of the New Notes in the EEA, if and when made, will be made pursuant to an exemption under the Directive 2003/71/EC (as amended) (the “Prospectus Directive”), as implemented in the member states of the EEA, from the requirement to produce a prospectus under the Prospectus Directive for offers of securities, and in particular, any offer of the New Notes will be made pursuant to an exemption set out in Article 3(2) of the Prospectus Directive (in Finland pursuant to an exemption under Chapter 4, Section 3 of the Finnish Securities Markets Act). Accordingly, any person making or intending to make any offer of the New Notes within the EEA should only do so in circumstances in which no obligation arises for SRV or OP Corporate Bank plc to publish a prospectus under the Prospectus Directive for such offer. Neither SRV nor OP Corporate Bank plc has authorized, nor do they authorize, the making of any offer of securities through any financial intermediary.

In relation to each member state of the EEA which has implemented the Prospectus Directive (each a “Relevant Member State”), an offer to the public of any New Notes may not be made in that Relevant Member State, except that an offer of the New Notes to the public in that Relevant Member State may be made at any time under the following exemptions from the Prospectus Directive, if they have been implemented in that Relevant Member State:

1. to any legal entity which is a qualified investor as defined in the Prospectus Directive;

2. to investors who acquire the New Notes for a total consideration of at least EUR 100,000 per investor; and/or

3. in any other circumstances falling within Article 3(2) of the Prospectus Directive,

in each case provided that no such offer of the New Notes shall result in a requirement for the publication of a prospectus pursuant to Article 3 of the Prospectus Directive or the preparation of a key information document in any language other than Finnish pursuant to the PRIIPs Regulation by SRV or OP Corporate Bank plc.

For the purposes of this provision, the expression an “offer to the public” in relation to the New Notes in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer of the New Notes to be offered so as to enable an investor to decide to purchase New Notes, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State.