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2015-08-24

Bittium Oyj: Bittium Corporation is planning to repurchase its own shares and stock options for a total purchase price of approximately EUR 595 million in a vo

Stock Exchange Release

Free for publication on August 24, 2015 at 8.00 a.m.
Not for release, publication or distribution (in whole or in part) in, into or
from the United States or any judisdiction where to do so would counstitute a
violation of the relevant laws of such jurisdiction.

Bittium Corporation is planning to repurchase its own shares and stock options
for a total purchase price of approximately EUR 595 million in a voluntary
public tender offer directed to all shareholders and holders of stock options
2008C of the Company

The Board of Directors of Bittium Corporation has decided to convene an
Extraordinary General Meeting on September 14, 2015 to decide on a repurchase
of its own shares ("Shares") and stock options 2008C ("Stock Options")
through a voluntary public tender offer directed to all shareholders and
holders of Stock Options of the Company (the "Offer").

Summary:

* The Offer would be made at market price and the consideration offered would
be determined as the volume weighted average price of the Share based on
transactions in NASDAQ OMX Helsinki Ltd over the five days preceding the
acceptance of the offer document rounded to the nearest full EUR cent (the
"Offer Price");
* The Offer would be made for a maximum of 124,747,351 Shares, corresponding
approximately to 94.1 per cent of all the Shares in the Company on the date
of this release. The Offer would also be made for a maximum of 252,648
Stock Options. The Offer would be executed only for the part of the
consideration payable for the Shares amounting up to EUR 593,797,392.67 in
the aggregate and for the Stock Options amounting up to EUR 1,202,607.33 in
the aggregate;
* The maximum number of Shares and Stock Options that the Offer concerns have
been determined on the basis of the numbers of all Shares and Stock Options
in the Company so that the Offer concerns the same proportional share of
all the Shares and Stock Options taking into account the 277,005 new shares
to be registered on or about September 1, 2015 subscribed for pursuant to
the Stock Options, the subscriptions of which the Company has accepted on
August 20, 2015 and the corresponding decrease in the number of Stock
Options;
* A shareholder or a holder of Stock Options may accept the Offer for all the
Shares and/or Stock Options owned by him/her or for a number of Shares
and/or Stock Options of his/her choosing per each book-entry account.
Possible multiple acceptances by the same person of Shares and Stock
Options, respectively, will be combined for each book-entry account;
* The Shares and Stock Options to be repurchased by the Company based on the
accepted offers will become null and void as a part of the settlement of
the Offer's execution so that they will not become in the Company's
possession. Thus, the restriction in the Finnish Limited Liability
Companies Act concerning the purchase of own shares, according to which the
purchase of own shares may not be executed in a way that the number of own
shares held by a company would exceed one tenth (1/10) of all the shares in
such a company, does not restrict the execution of the Offer;
* The completion of the Offer is conditional upon that no such fact or
circumstance has occurred after the date of this release that would
constitute a material adverse change in Bittium or in its subsidiaries,
considered as a whole;
* The price offered for the Stock Options is the Offer Price subtracted with
the share subscription price of the Stock Option, which was EUR 0.55 per
share on August 20, 2015;
* The Company intends to publish an offer document, which includes more
detailed information on the Offer, on or about September 23, 2015;
* The seven largest shareholders and a certain major shaholderof Bittium,
representing in the aggregate approximately 47.4 per cent of all the Shares
and votes in Bittium, have undertaken to vote for accepting the Offer in
the Extraordinary General Meeting;
* In the Offer, the seven largest shareholders and a certain major
shareholder of Bittium have, as described in detail in the following,
undertaken to offer for repurchase at least 70 per cent of the Shares each
of them owns, in the aggregate 43,949,571 Bittium shares, corresponding
approximately to 33,2 per cent of all the shares and votes in Bittium.

Background and reasons for the repurchase

The Company announced the sale of its Automotive business to German
Continental AG for a purchase price of EUR 600 million on May 19, 2015. The
closing of the transaction was announced on July 1, 2015. Further, on August
8, 2015, the Company announced that it plans to distribute the net proceeds
from the sale of its Automotive business to its shareholders in the first
instance by repurchasing own shares in a voluntary public tender offer made
to all shareholders of the Company.

The funds received from the sale of the Automotive business are not needed in
the current business of the Company and distributing such funds to the
shareholders is thus appropriate. As the amount of the funds to be
distributed is exceptionally large in comparison with the size of the
Company, the repurchase of own shares in a voluntary public tender offer is
an appropriate way to execute the distribution. In the voluntary public
tender offer of the Company to repurchase its own Shares, a large number of
shareholders will have an opportunity to sell their Shares, which would not
be possible in ordinary trading in the stock exchange due to a limited
trading volume. The decrease in the number of Shares, due to the Offer and
the Shares becoming null and void as part of the Offer, will further
contribute to maintaining the share price of the Company on an appropriate
level compared to a situation, where the profits to be used for the Offer
would be distributed for the shareholders as dividends while the number of
shares in the Company would remain unchanged.

The Company has received an advance ruling by the Finnish Central Tax Board
regarding the tax treatment of a shareholder participating in the Offer,
should Bittium repurchase its own Shares with the funds received in the sale
of the Automotive business in a public tender offer under certain terms and
conditions. Pursuant to the advance ruling by the Central Tax Board, the
provisions in Section 29 of the Finnish Act on Taxation Procedure regarding
veiled dividend are not applied to the repurchase of own shares and, thus,
the taxation of a shareholder participating in the Offer would be conducted
in accordance with the ordinary provisions on taxation of capital gains under
Finnish tax law.

A shareholder or a holder of Stock Options residing outside of Finland is
advised to contact a financial or legal advisor in their own country to
determine the taxation and any possible securities market consequences for
accepting the Offer.

The Offer Price

The Offer will be made at market price. The Offer Price will be the volume
weighted average price of the Share based on transactions in NASDAQ OMX
Helsinki Ltd. over the five days preceding the acceptance of the offer
document, on or about September 22, 2015, rounded to the nearest full EUR
cent. The Offer Price will be announced separately, in connection with the
publication of the offer document.

The consideration offered for the holders of Stock Options is determined by
subtracting the share subscription price of a Stock Option, which was EUR
0.55 per Share on August 20, 2015 from the Offer Price.

The Offer

The Board of Directors of the Company proposes to the Extraordinary General
Meeting that the maximum total number of Shares to be repurchased could be
124,747,351 Shares, corresponding approximately to 94.1 per cent of all the
Shares in the Company on the date of this release. The Company's Board of
Directors proposes further that the proposed amount of profits to be
distributed to the shareholders in the Offer would be a maximum of EUR
593,797,392.67 in total.

The Board of Directors of the Company proposes to the Extraordinary General
Meeting that the maximum total number of Stock Options to be repurchased in
the Offer would be 252,648 Stock Options. The Board of Directors proposes
further that the maximum total amount of profits distributable to the holders
of Stock Options in the Offer would be EUR 1,202,607.33.

The maximum numbers of Shares and Stock Options pursuant to the Offer have
been determined on the basis of the numbers of all Shares and Stock Options
in the Company so that the Offer concerns the same proportional share of all
Shares and Stock Options taking into account the 277,005 new shares to be
registered on or about September 1, 2015 subscribed for pursuant to the Stock
Options, the subscriptions of which the Company has accepted on August 20,
2015 and the corresponding decrease in the number of Stock Options.

The estimate on the amount of distributable funds is based on the separate
financial statements prepared for the period January 1, - July 1, 2015.

A shareholder or a holder of Stock Options may accept the Offer for all the
Shares and/or Stock Options owned by him/her or for a number of shares and/or
Stock Options of his/her choosing per each book-entry account.

According to the proposal of the Board of Directors, the Company would have a
right to reduce the number of Shares to be repurchased in the Offer in
proportion to the number of Shares offered for repurchase in the Offer
separately for each book-entry account, if the total number of Shares validly
accepted in the Offer would exceed the maximum number of the Shares to be
repurchased, 124,747,351 Shares or the maximum amount of funds to be
distributed EUR 593,797,392.67 (so called pro rata mechanism).

According to the proposal of the Board of Directors, the Company would
correspondingly have a right to reduce the number of Stock Options to be
repurchase in the Offer in proportion to the number of Stock Options offered
for repurchase in the Offer separately for each book-entry account, if the
total number of Stock Options validly accepted in the Offer would exceed the
maximum number of the Stock Options to be repurchased, 252,648 Stock Options
or the maximum amount of funds to be distributed EUR 1,202,607.33 (so called
pro rata mechanism).

The completion of the Offer is conditional upon that no such fact or
circumstance has occurred after the date of this release that would
constitute a material adverse change in Bittium or in its subsidiaries
considered as a whole. Such a material adverse change would especially be a
change which would result in the amount of distributable funds required for
the repurchase of the Shares and Stock Options pursuant to the Offer no
longer being fully available for the Company. The Company may cease, before
the ...

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