ChromoGenics targets an offensive market expansion and announces a rights issue with pre-emption rights of appr SEK 80 m.

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Summary

  • The board of directors of ChromoGenics AB (publ), reg. no. 556630-1809, has resolved to issue new shares (the “Rights Issue”), subject to approval by an extraordinary general meeting on 17 January 2019. Upon full subscription in the Rights Issue, the Company will raise SEK 77.7 million, before transaction costs.
  • ChromoGenics has received subscription undertakings corresponding to 78 per cent of the Rights Issue, of which 3 per cent refer to subscription undertaking and 75 per cent refer to guarantee commitments. The guarantors receive a market-based compensation for their commitments.
  • Anyone registered as a shareholder in ChromoGenics on 24 January 2019, has a pre-emptive right to subscribe for shares in the Rights Issue, where one (1) existing share entitles to three (3) subscription rights. One (1) subscription right entitles to subscription for one (1) share at a subscription price of SEK 0.60 per share.
  • The subscription period commences on 28 January 2019 and ends on 15 February 2019.
  • The proceeds from the Rights Issue are intended to fund and enable an offensive expansion of ConverLight® in the European market as well as investments in the production process. 
     

Summary of the background to and reasons for the Rights Issue

A sustainable and appreciated product. ChromoGenics’ business is based on world leading research which has resulted in edge competence and leading products in dynamic glass with controllable heat and light transmission. The company’s unique electrochromic technology, ConverLight, provides a sustainable solar control with increased indoor comfort and energy efficiency and contributes to green building certifications. The product is a very competitive replacement for awnings and other exterior solar control products and there is a great interest market interest in the product.

Highly increasing order volumes. According to the company’s interim report for the period January – September 2018, the outstanding volume of offers amounted to more than SEK 100 million and order intake amounted to SEK 10 million. After the reporting period, additional orders of approximately SEK 13 million have been communicated regarding ConverLight and the acquired static solar control solution I-Window. There have been some initial disturbances in the production process, which will burden the results in 2017 and 2018. Through investments and development work, the production process has gradually improved. The company believes that deliveries today meet high quality standards.

Ready for continued rapid growth. ChromoGenics is ready of the next step in the expansion phase.
New CEO and chairperson of the board of directors
– CEO Jerker Lundgren has more than 20 years’ experience in sales of glass facade contracting as CEO of Skandinaviska Glassystem. Chairperson Christer Simrén has been vice president of Billerud-Korsnäs and has long experience from the process industry.
Anticipated substantial market expansion
– The market for dynamic glass is expected to grow significantly during the coming years, according to the American analytics company n-tech Research.
Global market expansion through efficient and flexible production technology
– ChromoGenics unique production technology enables the company to seek partners in the glass industry internationally, and produce ConverLight locally in various geographical locations.
Increased intensity in sales
– More sales staff and a larger number of reference installations provide increased market presence and customer awareness. The Company also increases its pace within so‑called retro-fit sales, where current inefficient glass and solar control products are upgraded to ConverLight or I-Window.
Lower costs and higher production yield
– The Company intends to invest in production equipment for increased capacity and significantly decreased unit costs.

In order to support ChromoGenics’ strategic initiative, the board of directors has resolved to carry out a rights issue, a resolution subject to approval by the general meeting.

The Rights Issue strengthens the company’s balance sheet and secures continued market expansion and necessary investments in the production process, for better cost efficiency and profitability. A number of current projects tie up working capital. The net proceeds from the Rights Issue are intended to fund sales- and marketing costs and investments in the production process.

Issue of shares with pre-emption rights
On 17 December 2018, the board of directors of ChromoGenics resolved, subject to approval by the e
xtraordinary general meeting, to carry out an issue of shares with pre-emption rights for the Company’s existing shareholders. Upon full subscription in the Rights Issue, the Company will raise SEK 77.7 million before transaction costs. Anyone registered as a shareholder in ChromoGenics on 24 January 2019, has a pre-emptive right to subscribe for shares in the Rights Issue, where one (1) existing share entitles to three (3) subscription rights. One (1) subscription right entitles to subscription for one (1) share at a subscription price of SEK 0.60 per share.

The subscription period runs from 28 January 2019 to 15 February 2019. Through the issue of shares the company’s share capital may increase by not more than SEK 25,913,397.00 by an issue of not more than 129,566,985 new shares.

The issue of shares is subject to approval by the general meeting and is also subject to approval of new articles of association. Notice of the general meeting is announced today in a separate press release.

Complete terms and instructions for the Rights Issue and other information about the company will be presented in the prospectus which will be announced before the subscription period commences.

Indicative timetable

17 January 2019Extraordinary general meeting to approve the board of directors’ resolution on the Rights Issue
21 January 2019Last day of trade in the ChromoGenics share, including the right to participate in the Rights Issue
24 January 2019Record date for the right to participate in the Rights Issue
28 January – 13 February 2019Trade in subscription rights
28 January – 15 February 2019Subscription period
About 18 February 2019Announcement of preliminary outcome of the Rights Issue

Financial and legal advisors regarding the Rights Issue
G&W Fondkommission is financial advisor to ChromoGenics in connection with the issue. Advokatfirman Lindahl KB is legal advisor to the company.

Contact
Jerker Lundgren, CEO
Susanne Andersson, CFO & Head of Communications
+46 (0)18 430 04 30
info@chromogenics.com
Certified Adviser: G&W Fondkommission

This information constitutes such information that ChromoGenics AB (publ) is obligated to disclose in accordance with the EU Market Abuse Regulation. The information was submitted by the above-mentioned contact persons for publication on 18 December 2018, at 8:00 a.m. CET.

Every care has been taken in the translation of this document. In the event of discrepancies, the Swedish original will supersede the English translation.

IMPORTANT INFORMATION
The information in this press release does not constitute an offer to acquire, subscribe for or otherwise trade in shares or other securities in ChromoGenics. Any invitation to the persons concerned to subscribe for shares in ChromoGenics will only be made through the prospectus referred to in this press release.

This press release may not be released, published or distributed, directly or indirectly, in or into the United States, Australia, Canada, Japan, New Zealand, South Africa or any other jurisdiction where such action is wholly or partially subject to legal restrictions or where such action would require additional prospectuses, registrations or other actions in addition to those required under Swedish laws and regulations. Nor may the information in this press release be forwarded, reproduced or disclosed in a manner that contravenes such restrictions or would entail such requirements. Failure to comply with this instruction may result in a violation of applicable securities laws.

No shares have been or will be registered under the U.S. Securities Act of 1933, as amended (“Securities Act”), or securities legislation in any state or other jurisdiction in the United States, and may not be offered or sold, directly or indirectly, in or into the United States, except pursuant to an available exemption from the registration requirements of the Securities Act and in compliance with the securities laws of any state or other jurisdiction of the United States.

This press release may contain forward-looking statements which reflect ChromoGenics’s current view on future events and financial and operational development. The words “intend”, “estimate”, “expect”, “may”, “plan”, “anticipate” or similar expressions regarding indications or predictions of future developments or trends and which are not statements based on historical facts constitute forward-looking information. Although ChromoGenics believes that these statements are based on reasonable assumptions and expectations, ChromoGenics cannot give any assurances that such statements will materialize. Forward-looking statements are in its nature involved with both known and unknown risks and uncertainties, since it is depending on future events and circumstances. Forward-looking statements do not constitute any representations and warranties, and the outcome could differ materially from the information set out in the forward-looking statements.

About ChromoGenics
ChromoGenics offers dynamic glass with controllable heat- and light transmission. The company’s unique technology ConverLight® provides sustainable solar control for increased indoor comfort and energy efficiency. ConverLight® also contributes to Green Building certifications. In 2016 the company started commercial sales to real estate projects in Scandinavia.

ChromoGenics is located in Uppsala, Sweden, and the technology is derived from the world leading research center at Ångström Laboratory at Uppsala University. The plant has been partly financed by a conditional loan from the Swedish Energy Agency. ChromoGenics share (CHRO) is listed on Nasdaq First North Stockholm with G&W Fondkommission as Certified Adviser. http://www.chromogenics.com 


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