Cidron Intressenter AB[1] (“Cidron Intressenter”), a company indirectly wholly owned by Nordic Capital VII Limited[2] (“Nordic Capital Fund VII”), increases the price in the offer to the shareholders in Munters AB (publ) (“Munters” or the “Company”) to SEK 77 per share (the “Increased Offer”), reduces the required acceptance level to more than 50 per cent and extends the acceptance period up to and including 26 October 2010.

Summary of the Increased Offer:

  • The Offer price is increased from SEK 73 to SEK 77 per share.
  • The acceptance period is extended up to and including 26 October 2010. 
  • Shareholders representing approximately 10.3 per cent of the shares and votes in Munters have irrevocably undertaken to accept the Increased Offer, provided that no competing offer is announced at a price exceeding SEK 82.50 per share.
  • In addition, shareholders together holding approximately 32.6 per cent of the shares and votes in Munters have expressed that they support Cidron Intressenter’s Increased Offer and that they will tender their shares in Munters into the Increased Offer, insofar as no other bidder announces an offer to acquire shares in Munters at a price exceeding SEK 77 per share.
  • Completion of the Increased Offer is conditional upon, inter alia, that the Increased Offer is accepted to the extent that Cidron Intressenter becomes the owner of more than 50 per cent of the total number of shares in Munters.


The Increased Offer
 

On 29 September 2010, Cidron Intressenter announced a recommended offer to the shareholders in Munters, to acquire all the shares in Munters at a price of SEK 73 per share (the “Offer”). In light of the increased offer to the shareholders in Munters made by Alfa Laval AB (publ) (“Alfa Laval”) on 1 October 2010, Cidron Intressenter has decided to increase the price in the Offer to SEK 77 per share. 

The total value of the Increased Offer amounts to approximately SEK 5,693 million.[3] 

The Increased Offer represents an increase of 5.5 per cent compared to Cidron Intressenter’s Offer that was announced on 29 September 2010, and a premium of:

  • 2.7 per cent to the increased offer made by Alfa Laval on 1 October 2010 of SEK 75 per share in Munters;
  • 46.7 per cent to the closing price of SEK 52.50 for the Munters share on 3 September 2010, the last trading day prior to the announcement of Alfa Laval’s initial offer on 6 September 2010;
  • 54.3 per cent to the volume weighted average share price of approximately SEK 50 for the Munters share during the last three months prior to the announcement of Alfa Laval’s initial offer on 6 September 2010; and
  • 0.3 per cent to the closing price of SEK 76.75 for the Munters share on 12 October 2010, the last trading day prior to the announcement of the Increased Offer.

Shareholders who have tendered their shares at SEK 73 in cash per share, and not withdrawn their acceptance, will automatically benefit from the Increased Offer of SEK 77 in cash per share, as well as any Excess Value, as set out below, without further action. The acceptance period is extended up to and including 26 October 2010. The right to withdraw acceptances applies in the same manner as set out in the offer document.

In light of the information in this press release, Cidron Intressenter will prepare and make public a supplement to the offer document that was made public on 30 September 2010. Provided that Cidron Intressenter announces that all conditions for completion of the Increased Offer, as set out below, have been satisfied or waived no later than on 28 October 2010, settlement is expected to begin on or about
1 November 2010. Cidron Intressenter reserves the right to extend the acceptance period, as well as to postpone the settlement date.
 

Undertakings and support from shareholders

Shareholders representing approximately 10.3 per cent of the shares and votes in Munters (the “Undertaking Shareholders”), have through agreements with Cidron Intressenter irrevocably undertaken to accept the Increased Offer and tender their shares to Cidron Intressenter in the Increased Offer. These undertakings are conditional upon that no other public offer is made for all the shares in Munters, prior to the Increased Offer being declared unconditional, at a price exceeding SEK 82.50 per share. These undertakings are further subject to Cidron Intressenter revising the required acceptance level from more than 90 percent to more than 50 per cent of the total number of shares in Munters. 

Cidron Intressenter has agreed with the Undertaking Shareholders that in case Cidron Intressenter,
within twelve months following the acquisition of the shares under the Increased Offer, transfers or agrees to transfer the shares to a third party purchaser (including but not limited to tendering the shares in the offer made by Alfa Laval to the shareholders of Munters) and in such transfer receives a consideration per share which exceeds the price in the Increased Offer (such excess over the price in the Increased Offer the “Excess Value”), then Cidron Intressenter shall pay such Excess Value to the Undertaking Shareholders. Accordingly, Cidron Intressenter offers all shareholders who accept the Increased Offer a corresponding right on the same terms and conditions to receive the Excess Value.
 

In addition, shareholders together holding approximately 32.6 per cent of the shares and votes in Munters have expressed that they support Cidron Intressenter’s Increased Offer and that they will tender their shares in Munters into the Increased Offer, insofar as no other bidder announces an offer to acquire shares in Munters at a price exceeding SEK 77 per share. 

Financing of the Increased Offer 

Provided that the Increased Offer is accepted to such extent that Cidron Intressenter acquires shares in Munters representing more than 90 per cent of the total number of shares in Munters, the Increased Offer will be financed by a combination of equity and debt. Cidron Intressenter has entered into binding agreements regarding (i) contribution of capital from Nordic Capital Fund VII; and (ii) bank financing from Swedbank AB (publ) (“Swedbank”).

Drawdown pursuant to the loan agreements with Swedbank is subject to the conditions for the Increased Offer being satisfied or waived (where such waiver requires consent from the bank under certain circumstances). Besides the aforementioned, the loan agreements do not include any conditions which Cidron Intressenter and its owners in practice do not control (except for the condition that funding will not be provided if it is illegal for Cidron Intressenter to borrow or the lender to effect payment of the loan, which is a customary condition for drawdown pursuant to a loan of this kind).

The additional conditions to drawdown in accordance with the loan agreements with Swedbank which Cidron Intressenter and its owners in practice control and thus can not invoke in relation to the Increased Offer essentially relate to:

  • that Cidron Intressenter is capitalized with agreed equity;
  • that Cidron Intressenter acts in compliance with the Increased Offer and laws and regulations relating to the Increased Offer;
  • that Cidron Intressenter perfects the agreed pledge over the shares acquired in Munters; and
  • that Cidron Intressenter is not in breach of any of certain limited key obligations under the loan documentation.

In the event that the Increased Offer is accepted to a lesser extent than what is set out in the first paragraph under the heading “Financing of the Increased Offer” above, the Increased Offer will be financed by equity. Cidron Intressenter has for that purpose entered into a binding agreement regarding contribution of capital from Nordic Capital Fund VII. 

Conditions for completion of the Increased Offer  

Cidron Intressenter has decided to waive the conditions for the Offer relating to the divestment of division Moisture Control Services as well as to revise the condition that the Offer is accepted to the extent that Cidron Intressenter becomes the owner of more than 90 per cent of the total number of shares in Munters. Completion of the Increased Offer is therefore now conditional upon:

(i)            that the Increased Offer is accepted to the extent that Cidron Intressenter becomes the owner of more than 50 per cent of the total number of shares in Munters;

(ii)           that Alfa Laval does not match the Increased Offer (i.e. offers a price that at least corresponds to the Increased Offer) within ten business days;

(iii)          that no other party announces an offer to acquire shares in Munters on terms that are more favourable than the Increased Offer to the shareholders in Munters;

(iv)          that, with respect to the Increased Offer and the acquisition of Munters, all necessary regulatory, governmental or similar clearances, approvals and decisions from relevant authorities and bodies, including competition authorities, have been received, in each case on terms which, in Cidron Intressenter’s opinion, are acceptable, no later than on 30 November 2010;

(v)           that neither the Increased Offer nor the acquisition of Munters is wholly or partly prevented or materially adversely affected by any legislation or other regulation, court decision, public authority decision or similar circumstance, including action by third party, which is actual or could reasonably be anticipated and is outside the control of Cidron Intressenter and which Cidron Intressenter could not reasonably have foreseen at the time of the announcement of the Increased Offer;

(vi)          that, save as publicly announced by Munters prior to the date the Increased Offer was announced or as otherwise disclosed in writing to Cidron Intressenter prior to that date, Cidron Intressenter does not discover that any information publicly disclosed by Munters or otherwise made available to Cidron Intressenter is materially inaccurate or misleading or that any material information which should have been publicly disclosed by Munters has not been so disclosed;

(vii)         there being no circumstances, which Cidron Intressenter did not have knowledge about at the time of the announcement of the Increased Offer, that have occurred that have a material adverse effect or could reasonably be expected to have a material adverse effect upon Munters’ sales, results, liquidity, assets or equity;

(viii)        that Munters does not take any measures that typically are intended to impair the prerequisites for the implementation of the Increased Offer; and

(ix)         that Cidron Intressenter will receive payment in accordance with the loan agreements that Cidron Intressenter has entered into with Swedbank (this condition is only applicable where the acceptance level exceeds 90 per cent, see “Financing of the Increased Offer”).

Cidron Intressenter reserves the right to withdraw the Increased Offer in the event that it is clear that any of the above conditions are not fulfilled or cannot be fulfilled. However, with regard to conditions (ii) – (ix), such withdrawal will only be made provided that the non-fulfilment of such condition is of material importance to Cidron Intressenter’s acquisition of Munters. 

Cidron Intressenter reserves the right to waive, in whole or in part, any or all of the conditions above, including, with respect to condition (i) above, to complete the Increased Offer at a lower level of acceptance.

Advisors 

Bank of America Merrill Lynch and Nordea Corporate Finance are acting as financial advisors and
White & Case and Ashurst as legal advisors to Nordic Capital Fund VII and Cidron Intressenter in connection with the Increased Offer.
 

Stockholm, 13 October 2010

Cidron Intressenter AB

The Board of Directors 

The information in this press release was submitted for publication on 13 October 2010 at 10.30 (CET). 

Additional information: 

For additional information about the Increased Offer, please visit www.cidronintressenter.com or contact Nordea on +46 8 21 27 67. 

All media enquiries to:

Mikael Widell, Communications Manager
+46 8 440 50 70
+46 703 11 99 60  

[1] A newly formed company indirectly wholly owned by Nordic Capital Fund VII, under change of name from Goldcup 5924 AB to Cidron Intressenter AB.
[2] Nordic Capital VII Limited, a limited liability company established under the laws of Jersey, with registered office in St Helier, Jersey, acting, in relation to the Increased Offer, in its capacity as General Partner for and on behalf of Nordic Capital VII Alpha, L.P. and Nordic Capital VII Beta, L.P.
[
3] The offered price is subject to adjustment should Munters pay any dividend or make any other value distribution to shareholders prior to the settlement of the Increased Offer, and will accordingly be reduced by the amount of any such dividend or value distribution per share. It is based on 73,933,050 outstanding shares, which is the total number of outstanding shares in Munters, excluding Munters’ holding of 1,066,950 treasury shares.

Link to PDF:
http://feed.ne.cision.com/wpyfs/00/00/00/00/00/12/7B/C7/wkr0005.pdf

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