This announcement is informative and does not constitute recommendations and/or advice from Bank Degroof Petercam NV. Investing in the New Shares, the Preferential Subscription Rights and the Scrips involves a high degree of risk. An investor is exposed to the risk of losing all or part of its investment. Before any investment in the New Shares, the Preferential Subscription Rights or the Scrips, investors must read Section D of the Summary, starting on page 17, and Section 3 (Risk factors), starting on page 28, and more specifically, Section 3.1 (Risk factors relating to the Group and its Activities), starting on page 28, and Section 3.2 (Risks relating to the Offering), starting on page 39 of the Prospectus. Each of these risk factors must be carefully studied and assessed before investing in the New Shares, the Preferential Subscription Rights or the Scrips. The Group’s results have in the past and may be in the future substantially affected by the market price fluctuation of its products, in particular palm oil, which generates the majority of the Group’s revenue and profit.
Shareholders who fail to exercise their Preferential Subscription Rights will be diluted. In the context of the Offering, Ackermans & van Haaren NV may increase its shareholding above 30% without triggering the obligation to launch a mandatory public takeover bid.
SIPEF NV/SA (the “Company”) is offering 1,627,588 new ordinary shares without nominal value (the “New Shares”) pursuant to a capital increase with one statutory preferential subscription right granted per ordinary share (the “Preferential Subscription Right”). The New Shares to be issued within the framework of the Offering shall be of the same class as the existing and outstanding Shares of the Company at the moment of their issue. The Scrips will be offered for sale by way of an exempt private placement in the EEA and Switzerland.
Bank Degroof Petercam is in the framework of the Offering appointed as Co-Lead Manager.
Information on the Issuer
SIPEF – the connection to the world of sustainable tropical agriculture - is a Belgian agro-industrial company listed on Euronext Brussels. The Company mainly holds majority stakes in tropical businesses, which it manages and operates.
The Company and its subsidiaries (the “Group”) are active in the production of palm oil, rubber and tea (in Indonesia and Papua New Guinea) and bananas (in the Ivory Coast). The Group sells its own products throughout the world. SIPEF also provides management and marketing services to third parties.
The Group is active in three regions, and produces a number of different commodities. The overview below sets out the principal activities and their size (in hectares) per country as at December 2016.
The acquisition of an additional interest of 47.71% in PT Agro Muko will not increase the Group’s total palm oil area in Indonesia but will increase the Group share with some 8.870 ha (19.570 ha x 47.71% x 95%). The acquisition of PT Dendy Marker, if it occurs, would increase the total palm oil area in Indonesia with some 6.562 hectares and Group share with 6.234 ha (6.562 hectares x 95%).
The Groups’ main activity continues to be the production of palm oil, which is primarily undertaken in Indonesia and Papua New Guinea.
In total, the Groups’ Indonesian palm oil activities consist of a total of 47,016 planted hectares and five palm oil processing mills. The Indonesian rubber activities cover a total of 6,325 planted hectares and include three rubber processing factories. The Indonesian tea activities cover a total of 1,743 planted hectares and include one tea processing factory. The Indonesian palm oil and rubber activities are located in the province of North Sumatra, the province of Bengkulu and in the province of South Sumatra. The tea activities are located in the province of West Java. Activities are spread over a total of 14 companies with differing control and interest percentages, internally divided into four groups: the Tolan Tiga group, the Umbul Mas Wisesa group, the Agro Muko group and the Musi Rawas group.
The palm oil activities in Papua New Guinea cover a total area of 13,621 planted hectares and include three processing mills, all of which are located in the West New Britain province and operated by the company, Hargy Oil Palms Ltd, a wholly-owned subsidiary of the Company.
Besides palm oil from own areas the Group also produces palm oil from fruit purchased from local farmers. The overview below summarizes the split of the 2016 palm oil production from fruit sourced from own areas and fruit sourced from local farmers.
The Group’s banana and horticulture activities are all situated in the Ivory Coast and operated by the company, Plantations Jean Eglin, a wholly-owned subsidiary of the Company which includes four estates covering a total of 732 planted hectares: Azaguié, Motobé and St. Thérèse in the “Region des Lagunes” province and Agboville in the “region de l’Agnéby” province.
In addition to these principal activities, the Group also pursues three joint ventures in different sectors:
- The Group holds a 50% interest in the B.D.M. NV and ASCO NV insurance group, which focuses on maritime and industrial insurance. B.D.M. NV is an insurance agent for ASCO NV, among other things, and for a number of large international insurers offering risk coverage in certain niche markets.
- The Group also holds a 38% interest in Verdant Bioscience Singapore PTE Ltd (VBS), a company located in Singapore. VBS is a cooperation between Ultra Oleom PTE Ltd (52%), SIPEF (38%) and Biosing PTE (10%) with the objective of conducting research into and developing high-yielding seeds in order to commercialise these seeds.
Main characteristics of the Offering
The public offering to subscribe to 1,627,588 new shares in a capital increase in cash with statutory preferential subscription rights. Each shareholder will be granted one Preferential Subscription Right per ordinary share it holds at closing of the regulated market of Euronext Brussels on 4 May 2017 (the Record Date). The Preferential Subscription Rights will be represented by Coupon n° 9, which will be detached from the underlying share on 4 May 2017 after closing of the market. An application has been submitted to admit the Preferential Subscription Rights to trading on Euronext Brussels.
Preferential Subscription Rights that are not exercised during the Rights Subscription Period will be converted into an equal number of scrips (the Scrips). The Scrips will be offered for sale by way of an exempt private placement in the EEA and Switzerland, that is expected to start on 22 May 2017 and to end on the same date.
The extraordinary General Shareholders’ Meeting held on 4 April 2017 resolved to increase the Company’s share capital by an amount of up to USD 97,200,000 (including issuance premium), with preferential subscription rights granted to the existing Shareholders, in accordance with articles 592 and 593 of the Belgian Companies Code. The Company reserves the right to proceed with a capital increase for a lower amount.
The Issue Price has been fixed at € 54.65 per New Share.
Currency of the shares
The currency of the existing Shares and the New Shares is USD. The Offering takes place in EUR.
The ratio 2/11, pursuant to which 11 Preferential Subscription Rights or Scrips give the right to subscribe to 2 New Shares as part of the Offering.
Number of shares
Upon successful completion of the Offering, the Company will issue 1,627,588 New Shares, for an aggregate issue price of € 88,947,684.20 (or € 54.65 per new Share). The capital of the Company is expressed in USD. Based on the USD/EUR conversion rate published by the National Bank of Belgium on 3 May 2017, this corresponds to USD 97,121,976.38 (or USD 59.67 rounded per new Share).
Role of Bank Degroof Petercam
The Rights Offering shall start on 5 May 2017 and shall end on 19 May 2017.
The payment for the New Shares subscribed to with Preferential Subscription Rights is expected to take place on 24 May 2017. Delivery of the New Shares will take place on or around 24 May 2017.
Net proceeds and expenses of the Offering
The Company estimates that the expenses in relation to the Offering will be approximately € 2.3m. The net proceeds of the Offering may, therefore, be estimated at approximately € 85.56m.
Use of proceeds
The Company intends to use the net proceeds of the Offering (i) to reimburse part of the bridge loan facility entered into by the Company to finance the acquisition of an additional interest of 47.71% in PT Agro Muko and, as the case may be, (ii) to pay part of the purchase price for the envisaged acquisition of PT Dendy Marker.
Admission to trading and exchange
An application has been submitted to admit the New Shares to listing and trading on Euronext Brussels under the same symbol “SIP” as for the existing Shares. The New Shares are expected to have been separately accepted for clearance through Euroclear Bank NV/SA, as operator of the Euroclear system, under ISIN code BE0003898187. Delivery of the New Shares is expected to take place through the book-entry facilities of Euroclear Belgium against payment therefor in immediately available funds on or about 24 May 2017.
Restrictions on free transferability
There are no provisions limiting the free transferability of the existing Shares and New Shares included in the articles of association of the Company.
Rights attaches to the shares
The New Shares shall be of the same class and shall have the same rights as the existing Shares.
All of the existing Shares have the same voting rights except that voting rights are suspended when such Shares are held by the Company as treasury shares.
New Shares will be issued with Coupon n° 11 and following attached and will be entitled to dividend distributions as from the financial year 2017.
The dividend for the financial year 2016 is represented by Coupon n° 10 and will be detached on 4 May 2017.
Ackermans & van Haaren NV has committed to subscribe to (i) the number of New Shares that it is entitled to subscribe for pursuant to the Preferential Subscription Rights arising out of its shares and (ii) the number, if any, New Shares that remain available for subscription after the Subscription Period and the Scrips Private Placement for which no rights have been exercised during the Subscription Period and for which no Scrips could be placed during the Scrips Private Placement. As consideration for that commitment, Ackermans & van Haaren NV has been granted a right of first refusal, in priority to all other participants to the Scrips Private Placement to acquire such number of Scrips as it determines, at the price which results from the Scrips Private Placement bookbuilding, provided that the number of New Shares for which it may decide to subscribe in the Scrips Private Placement shall not exceed the total number of Shares to be placed in accordance with the Scrips Private Placement. Ackermans & van Haaren NV’s obligations under the Shareholder Subscription Commitment are subject to several conditions precedent, including but not limited to no material adverse effect having occurred.
Cabra NV and Gedei NV have committed to subscribe to 146,385 New Shares.
In the Underwriting Agreement, the Company is expected to undertake that during the period commencing on the date of the Underwriting Agreement and ending 180 days after the completion of the capital increase the Company shall not, and the Company shall procure that none of its respective subsidiaries will directly or indirectly (i) issue, offer, sell, transfer, pledge, solicit any offer to buy, attempt to dispose, short sale or otherwise dispose of any financial instruments of the Issuer, whether directly or indirectly, or enter into any agreement to do so, (ii) issue or offer any other securities or grant any options which confer a right to shares of the Issuer (or any interest therein) or which represent the financial instruments of the Issuer (or any interest therein), or enter into any agreement to do so, (iii) enter into any agreement having a similar economic effect (including any derivative transactions), or publicly announce any intention to do any one or more of the above actions, (iv) purchase any of its financial instruments or otherwise reduce its share capital, other than, in each case (i) with the prior written consent of the Sole Global Coordinator, (ii) the issue of the New Shares, or (iii) the issue of shares by the Company to the personnel and directors of the Company in the framework of a personnel incentive plan.
None of the shareholders of the Company has entered into any lock-up undertaking in connection with the Offering.
Dilution for the existing shareholders
If a Shareholder exercises all Preferential Subscription Rights allocated to it, there will be no dilution. Assuming that an existing Shareholder holding 1% of the Company’s share capital prior to the Offering does not subscribe to the New Shares, such Shareholder’s participation in the Company’s share capital would decrease to 0.85% as a result of the Offering.
The Prospectus is available in English and Dutch and the summary is available in French.
Subject to the terms of the Prospectus, the Prospectus will be made available to investors at no cost upon request from the Company on the phone number +32 (0)3 641 97 00. This Prospectus will also be made available to investors at no cost upon request to Degroof Petercam on the following phone number: +32 (0)2 662 82 62.
General: The tax treatment will depend on each investor's individual circumstances and may be subject to change in the future. The general principles are included in the prospectus.
Taxes on stock market transactions: No tax on stock market transactions is due on the new shares. The tax on stock market transactions is due on the acquisition of the existing shares, of which the rate amounts to 0.09% of the offer price, with a ceiling of € 1,300 per transaction and per party.
Tax regime in Belgium: Under the current tax regime, the distributed dividends are subject to a withholding tax of 30% %, or at the relevant progressive personal income tax rate(s), which are currently in the range of 25% to 50%, taking into account the taxpayer’s other declared income (whichever is more beneficial), on the gross amount. Withholding tax is a final tax liability for Belgian natural persons, which means it is not necessary to report revenues earned from the shares in the annual declaration. Some investors, however, subject to certain conditions qualify for an exemption.
Any complaints, insofar addressed to Bank Degroof Petercam NV, must be submitted to van Bank Degroof Petercam NV, Operational Risk Management, Nijverheidsstraat 44, 1040 Brussels, or by e-mail to email@example.com. If you are not satisfied with the complaints service, you can contact the Ombudsman in financial conflicts North Gate II, Koning Albert II laan 8, 1000 Brussels (www.ombudsfin.be ).
The English version of the Prospectus was approved on 3 May 2017 by the Belgian Financial Services and Markets Authority (FSMA) in its capacity as competent authority under article 23 of the Prospectus Law. The Prospectus is available in English and Dutch and the summary is available in French.
The following documents are available here:
More information can be found on de website of SIPEF.
These materials are not for release, distribution or publication, directly or indirectly, in whole or in part, into or in the United States, Australia, Canada or Japan, or in any other jurisdiction in which the release, distribution or publication would be unlawful.
These materials are for information purposes only and are not intended to constitute, and should not be construed as, an offer to sell or a solicitation of any offer to buy ordinary shares in the share capital of SIPEF NV (the Company, and such securities, the Securities) in the United States or in any other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of such jurisdiction, and the distribution of this communication in such jurisdictions may be restricted. Persons into whose possession this communication comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
The Securities are not and will not be registered under the U.S. Securities Act of 1933, as amended (the Securities Act) and may not be offered, exercised or sold in the United States absent registration or an exemption from the registration requirements of the Securities Act. The Company has no intention to register any part of the offering in the United States or make a public offering of Securities in the United States.
In relation to each member state of the European Economic Area which has implemented the Prospectus Directive (except Belgium) (each, a Relevant Member State), with effect from and including the date on which the Prospectus Directive (as defined below) is implemented in that Relevant Member State, none of the Securities may be offered or sold to the public in that Relevant Member State prior to the publication of a prospectus in relation to the Securities, which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive except that an offer of such Securities may be made to the public in that Relevant Member State:
(i) to any legal entity which is a “qualified investor” as defined in the Prospectus Directive;
(ii) to fewer than 100 or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive (as defined below), 150 natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive; or
(iii) in any other circumstances falling within Article 3(2) of the Prospectus Directive,
provided that no such offer of Securities shall require the Company to publish a prospectus or a supplement to an existing prospectus pursuant to Article 3 of the Prospectus Directive or any measure implementing the Prospectus Directive in a Relevant Member State and each person who initially acquires any Securities or to whom any offer is made under the Offering will be deemed to have represented, acknowledged, and agreed that it is a “qualified investor” within the meaning of Article 2(1)(e) of the Prospectus Directive.
For the purposes of this selling restriction, the expression an offer of Securities to the public in relation to any Securities in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Securities to be offered so as to enable an Investor to decide to acquire the Securities varied in that Relevant Member State, and the expression Prospectus Directive means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State, and the expression 2010 PD Amending Directive means Directive 2010/73/EU.
The release, publication or distribution of these materials are in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which they are released, published or distributed, should inform themselves about, and observe, such restrictions.
This announcement is not an advertisement within the meaning of the Prospectus Directive and does not constitute a prospectus. The offer to acquire securities pursuant to the proposed offering will be made, and any investor should make his investment, solely on the basis of information that will be contained in the prospectus to be made generally available in Belgium in connection with such offering. When made generally available, copies of the prospectus may be obtained at no cost through the website of the Company.
No action has been taken by the Company that would permit an offer of Securities or the possession or distribution of these materials are or any other offering or publicity material relating to such Securities in any jurisdiction where action for that purpose is required.
Degroof Petercam NV (Degroof Petercam) acts exclusively for the Company and no-one else in connection with any offering of Securities and will not be responsible to anyone other than the Company for providing the protections afforded to the customers of Degroof Petercam or for providing advice in relation to any offering or any transaction or arrangement referred to herein.