Port of Tallinn announces its intention to list on Tallinn Stock Exchange
Aktsiaselts TALLINNA SADAM (the "Company"), the owner of one of the largest landlord port facilities in the Baltic Sea Region, has announced its intention to proceed with an initial public offering (the “Offering”) and a listing of its Shares on the Baltic Main List of the Nasdaq Tallinn Stock Exchange (the "Tallinn Stock Exchange").
The purpose of the Offering is to offer to investors approximately one third of the Company. With the Offering, the Republic of Estonia, currently the Company's sole shareholder (the "Government Shareholder") intends to:
• increase flexibility, transparency and efficiency of the Company and to establish the Company's market value;
• facilitate the implementation of the Company’s strategic objectives;
• provide domestic investment opportunities for Estonian private investors and pension funds; and
• increase liquidity and attractiveness of the Tallinn Stock Exchange by attracting international investors.
The Group plans to use the net proceeds received from the Offering to fund part of the declared €105 million extraordinary net dividend to the Government Shareholder, which is expected to be paid in June 2018, together with a corresponding corporate income tax amounting to approximately €26 million. In addition, the Group plans to use part of the proceeds for general corporate purposes, including ongoing investments into the passenger harbours’ facilities, and to reduce the Group's leverage.
The Offering will consist of (i) an offering to Estonian and international institutional investors in reliance on Rule 144A/Regulation S under the U.S. Securities Act 1933 (the "Institutional Offering") and (ii) an offering to retail investors in Estonia, including to employees and members of the management and supervisory bodies of the Group (the "Retail Offering").
The contemplated Offering is expected to consist of a primary offering of new shares to be issued by the Company (the “New Shares”) and a secondary offering of certain existing shares (the “Existing Shares” and, together with the New Shares, the “Offer Shares”) to be sold by the Government Shareholder.
The Company intends to offer up to 75,404,968 New Shares and the Government Shareholder intends to offer up to 11,300,000 Existing Shares.
The Offering period is expected to start on or about 25 May 2018 and to last for about 9 working days.
The exact schedule of the Offering is subject to, among other things, prevailing market conditions and the timing of receiving necessary approvals from the EFSA, as well as obtaining appropriate corporate approvals.
The Government Shareholder and the Company are expected to enter into lock-up commitments for a period of 180 calendar days in connection with the Offering.
Citigroup Global Markets Limited (“Citigroup”) and Carnegie Investment Bank AB are acting as joint global coordinators and joint bookrunners (the "Joint Global Coordinators") in connection with the proposed Offering. Erste Group Bank AG and Swedbank AS are acting as Joint Bookrunners (the “Joint Bookrunners”). AS LHV Pank is acting as Joint Lead Manager (together with the Joint Global Coordinators and the Joint Bookrunners, the "Underwriters")
It is expected that a stabilisation arrangement will be put in place pursuant to which, following the date of commencement of trading of the Shares, Citigroup, as stabilising manager (acting directly or through an agent, the “Stabilising Manager”) on behalf of the Underwriters, may acquire Shares (up to the number of Existing Shares) in order to stabilise the trading price of the Shares at a level higher than that which would otherwise prevail if stabilisation transactions were not effected, in accordance with applicable securities regulations. The Government Shareholder is expected to agree that an amount not exceeding the gross proceeds obtained from the sale of the Existing Shares will be used by the Stabilising Manager to finance the stabilisation transactions. Any Shares acquired pursuant to this arrangement will be transferred back to the Government Shareholder at the end of the period of stabilisation.
CEO Valdo Kalm: “Port of Tallinn’s vision is to become the most innovative and modern port in the Baltic Sea Region with an emphasis on digitalisation, strong customer base and dedicated employees, with a business model structured around well-balanced core operational areas. Port of Tallinn has a track record of stable financial results and regular dividend distributions. In pursuing a listing on the Tallinn Stock Exchange, we are positioning ourselves as a highquality dividend asset. Listing the Company on the Tallinn Stock Exchange will add a stamp of quality to our achievements and push us to seek further developments.”
Chairman of the Supervisory Council, Aare Tark: “Port of Tallinn has an important role of being a lighthouse in port services in Estonia, as well as operating as a gateway to Europe and beyond for both passengers and cargo. The Company has a professional management team and a great potential for future development.”
Minister for Economics and Infrastructure, Kadri Simson: “The Government’s intention to list the shares of Port of Tallinn on Nasdaq Tallinn Stock Exchange primarily provides new investment opportunities in Estonia. This step is hoped to improve liquidity and attractiveness of the local capital market. The planned listing will also increase the efficiency and transparency of the Company even further and will provide an example for possible listings of other Estonian state-owned companies in the future.”