Moreld AS: Contemplated private placement and subsequent listing on Euronext Growth Oslo

NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA, THE HONG KONG SPECIAL ADMINISTRATIVE REGION OF THE PEOPLE'S REPUBLIC OF CHINA OR JAPAN, OR ANY OTHER JURISDICTION IN WHICH THE PUBLICATION, DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.

Subject to, among other things, Euronext Oslo Børs' approval of the Company's listing application, expected to be submitted on or about 12 December 2024, completion of the contemplated Reorganisation (as defined below) and a successful completion of the Private Placement, the Company's shares are expected to commence trading on Euronext Growth Oslo on or about 19 December 2024 under the ticker code "MORLD" (the "Listing").

Moreld investment highlights:

– Moreld is an industrial multi-disciplinary engineering group offering full-scope services across the offshore energy and marine industries including subsea installations 
– Moreld is a major player on the Norwegian continental shelf ("NCS") with an international footprint. The Group (as defined below) is located in 19 countries, giving access to all major offshore markets, with over 2,500 employees and contractors
– Long-term agreements with diversified and high-quality exploration & production (E&P) operators with 40+ years of experience on the NCS
– The Company has seen a very strong EBITDA development over the last years and expects EBITDA (excl. IFRS 16) of NOK 1.0-1.1 billion in 2024, has a strong backlog of approx. NOK 10 billion, and a solid financial position with net debt of approx. NOK 0.4 billion post Private Placement
– The Company has an attractive asset-light business model, with strong cash flow and no major capex requirements
– Moreld is led by a management team and organisation with extensive experience from the offshore energy sector, complemented by a highly qualified board of directors with a diverse skill set 

Geir Austigard, CEO of Moreld, comments: "With almost NOK 9 billion in revenue and a customer base of highly respected and ambitious energy companies, Moreld has reached a stage and scale where listing is a logical next step. On Euronext Growth and with a subsequent potential uplisting to a fully regulated marketplace, the Company will benefit from access to capital and market visibility. We will provide investors exposure to our attractive business model and high growth markets. Our asset-light business model results in strong cash flow generation, which means we will be well positioned to pay dividends, providing an attractive balance of growth and direct return for investors."

The Company's board of directors (the "Board") has resolved to pursue an uplisting to a fully regulated marketplace operated by Euronext Oslo Børs within 9 months after the Listing, subject to, inter alia, favourable market conditions and satisfaction of applicable listing requirements.

The Private Placement

The Private Placement will comprise an offering of 64,550,000 new shares in the Company (the "New Shares") at a fixed price of NOK 13.95 per New Share (the "Offer Price"), to raise gross proceeds to the Company of approx. NOK 900 million. The Offer Price represents a pre-money equity value of the Company of approx. NOK 1,550 million based on a total of 111,278,096 shares in the Company (pro forma after completion of the Reorganisation, see below).

The net proceeds from the Private Placement will be used to repay debt (including executing an option to repay up to 40% of Aurora Group's USD 225 million outstanding note at a price of 106.25%), as well as for general corporate purposes. 

In addition to the New Shares, the Managers may elect to over-allot up to 7,200,000 additional shares in the Company at the Offer Price, representing approx. 11.15% of the number of New Shares allocated in the Private Placement (the "Additional Shares", and together with the New Shares, the "Offer Shares"), implying a total offering of up to 71,750,000 Offer Shares and a total transaction size of approx. NOK 1 billion, if over-allotments are made (the "Offer Size"). In order to facilitate such over-allotments, Allard 2 Limited ("McIntyre") and Sona Credit Master Fund Limited, Sona Capital Solutions II SCSp and Sona Blue Peak Ltd (collectively referred to as "Sona") (together, the "Share Lenders") will grant Pareto Securities AS, in its capacity as stabilisation manager on behalf of the Managers (the "Stabilisation Manager"), an option to borrow a number of the then existing shares in the Company equal to the number of Additional Shares allocated in the Private Placement (the "Borrowing Option").

Further, the Company has granted the Stabilisation Manager, on behalf of the Managers, a right to have issued a number of new shares in the Company equal to the number of Additional Shares at a price per new share equal to the Offer Price (the "Greenshoe Option"), to cover the potential short position resulting from any over-allotments of Offer Shares. The Greenshoe Option may be exercised, in whole or in part, by the Stabilisation Manager, on behalf of the Managers, within 30 days commencing at the first day of trading of the Company's shares on Euronext Growth Oslo. Any net profit generated from any stabilisation activities shall be for the benefit of the Share Lenders. Any exercise of the Greenshoe Option will raise additional proceeds to the Company.

The Private Placement will be directed towards Norwegian and international investors, in each case subject to an exemption being available from offer prospectus requirements and any other filing or registration requirements in the applicable jurisdictions and subject to other selling restrictions. The minimum application and allocation amount have been set to the NOK equivalent of EUR 100,000. The Board may, however, at its sole discretion in consultation with the Managers, offer and allocate Offer Shares for an amount below the NOK equivalent of EUR 100,000 to the extent exemptions from prospectus requirements pursuant to Regulation (EU) 2017/1129 and ancillary regulations, as amended and as implemented by the Norwegian Securities Trading Act, are available. 

Pre-commitments and indications

 – McIntyre, which is represented on the Board by Julian McIntyre, has pre-committed to subscribe for, and will be allocated, Offer Shares for approx. USD 12 million at the Offer Price in the Private Placement.
– Annapurna Worldwide Services Pte Ltd ("Siva"), which is represented on the Board by Venkat Siva, has pre committed to subscribe for, and will be allocated, Offer Shares for approx. USD 4.5 million at the Offer Price in the Private Placement.
 – In addition, the Managers have, during the pre-sounding phase of the Private Placement, received indications from certain new investors and existing shareholders which in aggregate covers the entire Offer Size at the Offer Price in the Private Placement.

Timeline and application period

The application period in the Private Placement will commence today, 9 December 2024 at 09:00 CET and close on 11 December 2024 at 16:30 CET (the "Application Period"). The Board may, however, at its sole discretion in consultation with the Managers, shorten or extend the Application Period at any time and for any reason on short notice. If the Application Period is shortened or extended, the other dates referred to herein might be changed accordingly.

Allocation and settlement

The allocation of Offer Shares will be determined following the application period, and the final allocation will be made at the sole discretion of the Board (in consultation with the Managers). The Board will focus on criteria such as (but not limited to) pre-commitments and indications from the pre-sounding phase of the Private Placement, current ownership in the Company, timeliness of the application, relative order size, sector knowledge, perceived investor quality and investment horizon. Notification of allocation is expected to be sent to the applicants by the Managers on or about 12 December 2024.

The Offer Shares allocated in the Private Placement are expected to be settled on a delivery versus payment (DvP) basis on or about 19 December 2024, following completion of the Conditions. The DvP settlement will be facilitated by pre-funding and share lending arrangements between the Company, the Managers, and the Share Lenders.

Lock-up

The Company, McIntyre, Sona, Siva, Velocity Aurora LLP, Modro Holdings LLC, as well as members of the Company's management and Board, will enter into customary lock-up arrangements with the Managers in connection with the Private Placement that will restrict, subject to certain exemptions, their ability to issue, sell or dispose of any shares in Moreld, as applicable, for a period of 6 months after the date of the Listing, without the prior written consent of the Managers. 

In addition, a total of approx. 6.76% of the Company's shares outstanding (pro forma post Reorganisation, which includes certain shares held by members of the Company's Board, management and workforce) is subject to the Group's management incentive plan ("MIP") and will in accordance with the terms thereof be subject to a 6-month lock-up, with a lock-up schedule relating to certain MIP shares continuing for a period of 24 months and 36 months respectively after the date on which the relevant participant initially acquired the MIP shares. 

In total, approx. 92.56% of the Company's shares outstanding (pro forma post Reorganisation) will be locked up based on the agreements referred to above.

Conditions for completion of the Private Placement

Completion of the Private Placement by settlement of Offer Shares towards investors is conditional upon: (i) All corporate resolutions of the Company required to implement the Reorganisation, the Private Placement and the Listing being validly made, including, without limitation, the Board approving the allocation of Offer Shares and the sole shareholder of the Company (Moreld Holding AS) resolving to issue the New Shares; (ii) registration of the share capital increases pertaining to the Reorganisation and the issuance of the New Shares with the Norwegian Register of Business Enterprises; (iii) the issuance of the new shares relating to the Reorganisation as well as the Offer Shares in the Norwegian Central Securities Depository (Euronext Securities Oslo), (iv) completion of the Reorganisation; (v) Euronext Oslo Børs approving the application for Listing and the satisfaction of any conditions for Listing set by Euronext Oslo Børs, and (vi) the agreement pertaining to a pre-funding and share lending arrangements to be entered into between the Company, the Managers and the Share Lenders remaining in full force and effect (jointly, the “Conditions”). There can be no assurance that these Conditions will be satisfied. If the Conditions are not satisfied, the Private Placement may be revoked or suspended, and the Listing may not take place. 

The Company reserves the right, at any time and for any reason, to cancel and/or modify the terms of the Private Placement. Neither the Company nor the Managers will be liable for any losses incurred by applicants if the Private Placement is cancelled and/or modified, irrespective of the reason.

Background and the Reorganisation 

The Moreld Group (the "Group") was formed in December 2023 with Aurora Group P.L.C. ("Aurora Group") as its parent company, when 100% of the shares in More Holdco Apply AS and Global Maritime Group AS were acquired by Aurora Group's subsidiary, Moreld Group AS. In June 2024, Moreld Group AS further acquired 100% of the shares in Ocean Installer Holding AS. 

The Company was acquired as a shelf company in August 2024 for the purpose of the contemplated Private Placement and Listing. Simultaneously with the completion of the Private Placement, all shareholders and all or most holders of warrants in Aurora Group, as well as all shareholders in Moreld Holding AS (excluding Aurora Group), a subsidiary of Aurora Group, will become shareholders in the Company via a roll-up of their shares and warrants in Aurora Group and Moreld Holding AS to shares in the Company, and Moreld will become the new parent company of the Group (the "Reorganisation"). 

Advisors 

Pareto Securities AS and SpareBank 1 Markets AS are acting as joint global coordinators in the Private Placement and as Euronext Growth advisors to the Company in connection with the Listing. Fearnley Securities AS is acting as co-manager in the Private Placement.

Wikborg Rein Advokatfirma AS is acting as Norwegian legal counsel to the Company, Marriott Harrison is acting as UK legal counsel to the Company, and Carter Ledyard & Milburn LLP is acting as US legal counsel to the Company. Advokatfirmaet Schjødt AS is acting as legal counsel to the Managers.

For more information, please contact:

CEO Geir Austigard
Telephone: +47 992 47 500
Email: Geir.austigard@moreld.com 

CFO Trond Rosnes
Telephone: +47 404 14 494
Email: Trond.rosnes@moreld.com 

Alternative performance measures (APMs)

The following APMs are used in this announcement:

 – EBITDA excl. IFRS 16: EBITDA is the abbreviation of “Earnings Before Interest, Taxes, Depreciation and Amortization”. EBITDA exclusive IFRS 16, meaning that the impact of lease contracts accounted for under IFRS 16 are excluded and lease payments are accounted for as direct cost.

– Net debt: Net Interest-Bearing Debt is calculated as Gross Interest-Bearing Debt minus cash and cash equivalents. Unused credit facilities are not included in the cash amount. Gross Interest-Bearing Debt is defined as non-current interest-bearing liabilities minus lease liabilities accounted for under IFRS 16.

IMPORTANT NOTICE

These materials are not and do not form a part of any offer of securities for sale, or a solicitation of an offer to purchase, any securities of the Company in the United States or any other jurisdiction. Copies of these materials are not being made and may not be distributed or sent into any jurisdiction in which such distribution would be unlawful or would require registration or other measures. 

The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and accordingly may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any part of the offering in the United States or to conduct a public offering of securities in the United States. Any sale in the United States of the securities mentioned herein will be made solely to "qualified institutional buyers" (QIBs) as defined in Rule 144A under the Securities Act, pursuant to an exemption from the registration requirements under the Securities Act, as well as to major U.S. institutional investors under SEC Rule 15a-6 to the United States Exchange Act of 1934, as amended.

In any EEA member state, this communication is only addressed to and is only directed at qualified investors in that member state within the meaning of the EU Prospectus Regulation, i.e., only to investors who can receive any offering of securities referred to in this announcement without an approved prospectus in such EEA member state. "EU Prospectus Regulation" means Regulation (EU) 2017/1129, as amended (together with any applicable implementing measures in any EEA member state).

In the United Kingdom, this communication is only addressed to and is only directed at Qualified Investors who are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") or (ii) persons falling within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations, etc.) (all such persons together being referred to as "Relevant Persons"). These materials are directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this communication relates is available only to Relevant Persons and will be engaged in only with Relevant Persons. Persons distributing this communication must satisfy themselves that it is lawful to do so. 

This communication contains certain forward-looking statements concerning future events, including possible issuance of equity securities of the Company. Forward-looking statements are statements that are not historical facts and may be identified by words such as "believe", "expect", "anticipate", "strategy", "intends", "estimate", "will", "may", "continue", "should" and similar expressions. The forward-looking statements in this communication are based upon various assumptions, many of which are based, in turn, upon further assumptions. The Company believes that these assumptions were reasonable when made. However, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Such risks, uncertainties, contingencies and other important factors include, but are not limited to, the possibility that the Company will determine not to, or be unable to, issue any equity securities, and could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The Company does not make any guarantee that the assumptions underlying the forward-looking statements in this announcement are free from errors. 

The information, opinions and forward-looking statements contained in this communication speak only as at its date and are subject to change without notice. Each of the Company, the Managers and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any statement contained in this communication whether as a result of new information, future developments or otherwise.

The Managers are acting exclusively for the Company and no one else in connection with the Private Placement and the Listing and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, or for advice in relation to the contents of this announcement or any of the matters referred to herein. Neither the Managers nor any of their respective affiliates makes any representation as to the accuracy or completeness of this announcement and none of them accepts any responsibility for the contents of this announcement or any matters referred to herein.

This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. Neither the Managers nor any of their respective affiliates accepts any liability arising from the use of this announcement.

The Private Placement may be influenced by a range of circumstances, such as market conditions, and there is no guarantee that the Private Placement will proceed and that the Listing will occur.

Certain figures contained in this announcement, including financial information, have been subject to rounding adjustments. Accordingly, in certain instances, the sum or percentage change of the numbers contained in this announcement may not conform exactly with the total figure given. 

The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. Specifically, neither this announcement nor the information contained herein is for publication, distribution or release, in whole or in part, directly or indirectly, in or into or from the United States (including its territories and possessions, any state of the United States and the District of Columbia), Australia, Canada, Hong Kong, Japan or any other jurisdiction where to do so would constitute a violation of the relevant laws of such jurisdiction.