Kyoto Group AS

06/14/2024 | Press release | Distributed by Public on 06/13/2024 23:10

Leading global energy transition infrastructure fund to invest NOK 286.7 million in Kyoto and make recommended tender offer at substantial premium.

Leading global energy transition infrastructure fund to invest NOK 286.7 million in Kyoto and make recommended tender offer at substantial premium.

14 Jun 2024 07:05 CEST



Kyoto Group AS


Oslo, Norway 14 June 2024 - Kyoto Group AS ("Kyoto" or the "Company") has
entered into a transaction agreement with GF I Kiln HoldCo AS (the "Offeror"), a
newly established acquisition vehicle owned by Glentra Fund I K/S ("Glentra")
regarding a directed share issue in Kyoto (the "Investment") combined with a
subsequent recommended voluntary all-cash offer for all outstanding shares (the
"Shares") of the Company (the "Offer", and together with the Investment, the
"Transaction"). Shareholders representing a total of 73.5% of the Shares in
Kyoto support the Transaction, and have committed to sell their shares.


· Game-changer for Kyoto: Recognition and strategic investment from a leading
global energy transition infrastructure investor.
· Investment raising gross proceeds of NOK 286.7 million at a premium of 37.7%
to the closing price on 13 June 2024.
· Subsequent voluntary all-cash offer to all shareholders for outstanding
shares at a premium of 94.3% to the closing price on 13 June 2024.
· Kyoto's three largest investors maintain their ownership interests in the
private company.
· Pre-committed support for investment and offer resulting in 86.0% ownership
for the Offeror.
· Intention from Glentra for significant further investment and support in
private setting.
· Strong balance sheet opens new business opportunities.
· The board of Kyoto unanimously supports the combination of the share issue
and the Offer.

The Investment and Offer are made via the Offeror. Based in Copenhagen and
London, Glentra Capital P/S is the manager of Glentra and is a dedicated energy
transition infrastructure investor with deep industry insights. Last year, it
announced its first fundraise with total commitments of EUR 443 million from
anchor investors Novo Holdings and PKA, and several other investors.

The Investment consists of a NOK 286.7 million equity raise where the Offeror
will subscribe for 16,867,647 new Shares in Kyoto at a subscription price of NOK
17.00 per share (the "New Shares"). The subscription price represents a premium
of 37.7% compared to the closing price of Kyoto's share of NOK 12.35 on 13 June
2024. The net proceeds will be used to accelerate Kyoto's commercial development
and to fund the Company's liquidity need and operations going forward. Until
completion of the Investment, the Company is expected to cover short-term
liquidity needs through agreed customer payments.

Glentra has also expressed an intention to provide further funding for Kyoto in
the long term.

The Offer is a voluntary all-cash offer made for all outstanding shares in
Kyoto. The offer price is NOK 24.00 per share (the "Offer Price").

The Offer Price represents a premium of:

· 94.3% to the closing price of NOK 12.35 on 13 June 2024.
· 62.8% to the volume weighted average price of NOK 14.74 over the 3 months up
to and including 13 June 2024.
· 59.9% to the volume weighted average price of NOK 15.01 over the 6 months up
to and including 13 June 2024.

Kyoto's three largest existing shareholders Spirax Group, Iberdrola and KM New
Energy, representing a total of 8,408,082 shares, or 44.5% of total outstanding
Shares prior to the Investment, support the strategic rationale of the
Transaction and have on certain terms and conditions agreed to reinvest in the
Offeror through a contribution of its Shares to the Offeror at the Offer Price
against newly issued shares in the Offeror, upon completion of the Offer.

Eivind Reiten, Chairman of Kyoto Group, said: "The board believes that the
combination of the share issue and the offer is in the best interest of our
shareholders and that having Glentra as a long-term strategic shareholder will
benefit the company, employees, partners and customers. This solution will give
Kyoto Group the financial resources to accelerate its commercialization and its
contribution to the transition to renewable energy in industrial applications."

Henrik Tordrup, Managing Partner at Glentra, said: "Our investment and
partnership with Kyoto is part of our commitment to back companies deploying
demand side solutions that promote the low carbon transition. The Heatcube has
significant potential to accelerate decarbonization of process heat in Europe
and globally. We have been following the company closely and are impressed by
the team and the progress made to date. Kyoto is an excellent strategic fit with
Glentra and we look forward to working with Kyoto over many years."

Camilla Nilsson, CEO of Kyoto Group, said: "I am impressed by Glentra's drive
and dedication, by their operational and financial capability to make a
difference to the ongoing energy transition, and by the track record of the
people involved. I look forward to working together to commercialize Heatcube,
now with a stronger balance sheet that enables us to accelerate in a way that
has so far not been possible, including operating heat-as-a-service with assets
owned by Kyoto."

Board Recommendation and equal treatment considerations

The board of Kyoto (the "Board") believes the Transaction is in the best
interests of Kyoto and its shareholders and has unanimously recommended the
Offer as well as suggested setting aside the pre-emptive rights of existing
shareholders for new shares in connection with the Investment.

Pursuant to the transaction agreement entered into with the Offeror, the Board
shall not amend or withdraw its recommendation of the Offer unless it receives a
bona fide unsolicited superior competing offer that fulfills certain pre-agreed
terms, including an offer price per share of minimum NOK 27, to be further
detailed in the Offer Document. When recommending the Offer and the Investment
(which includes a deviation of the shareholders' pre-emptive rights), the Board
has considered the terms and conditions of the Offer and the Transaction and has
also obtained a fairness opinion from its financial advisor, Alpha Corporate
Finance, concluding that the Offer is full and fair from a financial point of
view. The Board has in particular emphasized that the Investment is from a new
strategic investor and no existing shareholders will participate in the
Investment, that the Investment will provide the Company with the needed funding
in the short and longer term, and that the dilutive effect of the Investment
will be partly and indirectly mitigated with the Tender Offer, whereby launch of
the Tender Offer is a condition for the Investment. Further, the subscription
price of the Investment and in the Tender Offer is the result of extensive
negotiations and necessary in order to facilitate the Investment and the
Transaction as a whole. In addition, the confirmed intention of Glentra to
support further funding of Kyoto and the broad support of the Transaction by the
Company's largest shareholders support the Board's view. Finally, the Board has
stressed that the agreed Offer Price provides a liquidity event for the
shareholders at a significant premium compared to prevailing trading prices on
Euronext Growth Oslo.

Two board members, representing Spirax Group and Iberdrola, did not take part in
the resolution due to their reinvestment agreement with the Offeror.

Transaction details

The Company expects later today to issue a notice of a general meeting to be
held on 28 June 2024 which will include the proposed resolution related to the
Investment. In addition, the Offeror expects to issue an Offer Document in the
near future which will set out the complete details relating to the Offer. The
offer period (the "Offer Period") is expected to commence shortly after
publication of the Offer Document and continue for a period of one week, subject
to any extensions of up to ten weeks in total. More details regarding the Offer
Period will be included in the Offer Document.

In addition to the reinvesting shareholders referred to above, shareholders
representing a total of 5,484,601 shares, or 29.0% of total outstanding Shares
prior to the Investment, have signed binding undertakings to accept the Offer,
including Valinor AS who is represented on the Board through Pål Selboe Valseth.

Thus, shareholders representing 13,892,683 shares in Kyoto have either committed
to contribute their shareholding to the Offeror or have pre-accepted the Offer.
Taken together with the New Shares to be issued to the Offeror as part of the
Investment, a total of 30,760,330 Shares are committed to being contributed,
sold or issued to the Offeror, representing 86.0% of the number of Shares in
Kyoto following registration of the share capital increase pertaining to the
issuance of New Shares in connection with the Investment.

The Investment will be conditional upon the following conditions for completion:

· The Offer being launched;
· the Company having obtained from Nordic Environment Finance Corporation a
consent to the Transaction and thereby waiving any change of control rights in
the loan agreement between the Company and NEFCO; and
· the general meeting of the Company resolving the share capital increase
pertaining to the issuance of the New Shares.

The Investment will not be conditional upon the completion of the Offer.

The Offer will be conditional upon the following conditions for completion, each
of which may be waived by the Offeror:

i) the Offeror shall receive acceptances of the Offer which together with
the Investment and the shares contributed by the largest existing shareholders
will lead to the Offeror holding 90% of the shares in the Company,

ii) the Board shall not have amended or withdrawn its recommendation of the

iii) the roll-over agreement and shareholder agreement for ownership in the
Offeror post completion of the Offer shall have been executed by each of Spirax
Group, Iberdrola and KM New Energy,

iv) the Company shall conduct its business in the ordinary course,

v) no material breach by the Company of the transaction agreement shall have

vi) no material adverse change shall have occurred between the date of this
Agreement and until settlement of the Offer, and no court or other governmental,
regulatory authority of competent jurisdiction or other third party shall have
taken or threatened to take any legal action in relation to the Offer or the
closing thereof, which would result in a material adverse change.

The Offer will not contain any conditions as to financing or due diligence.

Following completion of the Offer, and subject to the Offeror reaching a 90%
shareholding in Kyoto, the Offeror intends to carry out a compulsory acquisition
of remaining Shares not held by the Offeror and delist Kyoto from Euronext
Growth Oslo.


Alpha Corporate Finance is acting as financial adviser to Kyoto Group.
Advokatfirmaet Wiersholm AS is acting as legal adviser to Kyoto Group.
Advokatfirmaet Schjødt AS is acting as legal adviser to Glentra.

For further information, please contact:

Kyoto Group:

Håvard Haukdal, CFO

[email protected]

+47 48 10 65 69

For Glentra:

Reliance A/S, Poul Lykkesfeldt

[email protected]

+45 20 21 71 30

This information is considered to be inside information pursuant to the EU
Market Abuse Regulation and is subject to the disclosure requirements pursuant
to Section 5-12 the Norwegian Securities Trading Act. This stock exchange notice
was published by Håvard Haukdal, CFO of the Company, on the time set out herein.

About Kyoto Group

Heat accounts for two thirds of industrial energy consumption. Traditionally,
nearly all of it is based on fossil fuels. Kyoto Group's Heatcube, a thermal
energy storage (TES) solution, provides a sustainable and cost-effective
alternative by capturing and storing abundant but variable energy from sources
such as solar and wind. Founded in 2016, Kyoto Group is headquartered in Oslo,
Norway, and has subsidiaries in Spain and Denmark. The Kyoto share is listed on
Euronext Growth (ticker: KYOTO).

About Glentra Capital

Glentra Capital P/S ('Glentra') is the registered alternative investment fund
manager of Glentra and was founded in 2022 by senior executives from the
renewable energy and fund management industries, with the vision to generate
attractive risk-adjusted returns while accelerating the global energy transition
for a clean and sustainable future. Glentra will contribute to this vision by
investing in and growing exceptional companies that deliver the energy
infrastructure of tomorrow via investments in development platforms ranging from
offshore wind to solar and sustainable fuels and in their supply chain companies
as well as in energy optimisation and integration businesses. The mix of
industry and investment experience among Glentra's partners and team of
employees secures a unique platform for growth and value creation for portfolio
companies and investors. Glentra has offices in Copenhagen and London.

Important notice

The Offer and the distribution of this announcement and other information in
connection with the Offer may be restricted by law in certain jurisdictions. The
Offeror and the Company assume no responsibility in the event that there is a
violation by any person of such restrictions. Persons who are in possession of
this announcement or such other information are required to inform themselves
about and to observe any such restrictions.

The Offer and the distribution of this announcement and other information in
connection with the Offer may be restricted by law in certain jurisdictions.
When published, the Offer Document and related acceptance forms will not and may
not be distributed, forwarded or transmitted into or within any jurisdiction
where prohibited by applicable law, including, without limitation, Canada,
Australia, New Zealand, South Africa, Hong Kong and Japan.

The Offeror does not assume any responsibility in the event there is a violation
by any person of such restrictions. Persons into whose possession this
announcement or such other information should come are required to inform
themselves about and to observe any such restrictions.

This announcement is not a tender Offer document and, as such, does not
constitute an offer or the solicitation of an offer to acquire the Shares.
Investors may accept the Offer only on the basis of the information provided in
the Offer Document. Offers will not be made directly or indirectly in any
jurisdiction where either an offer or participation therein is prohibited by
applicable law or where any tender offer document or registration or other
requirements would apply in addition to those undertaken in Norway.

This announcement contains certain forward-looking statements within the meaning
of the securities and laws and regulations of various international, federal,
and state jurisdictions. All statements, other than statements of historical
fact, included herein, including without limitation, statements regarding the
Offer, future plans and objectives of Company or the Offeror are forward-looking
statements that involve risk and uncertainties. There can be no assurances that
such statements will prove to be accurate and actual results could differ
materially from those anticipated in such statements.

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