Oslo, 7 May 2015 - Reference is made to the
announcement from Blom ASA ("Blom") on 23 April 2015
where it was announced that Blom had entered into an
agreement to combine its business with Team Bane AS
("Team Bane"). To further build a Northern European
railway infrastructure and geospatial company, Blom
has entered into an agreement to acquire Svensk
Järnvägsteknik AB and its subsidiaries ("SJT") in
addition to the already announced combination with
Team Bane (the "Transactions"). Team Bane and SJT
are leading specialist players within railway
infrastructure in Norway and Sweden, respectively.
In connection with the Transactions, the publicly
listed parent company Blom ASA will change name to
NRC Group ASA ("NRC Group"). NRC Group will be well
positioned in the infrastructure segment in Northern
Europe, with a strong position in the market for
construction of railway infrastructure in Norway and
Sweden. These markets are set for strong growth over
the coming years. NRC Group delivered combined
revenues of NOK 954 million and EBITDA of NOK 97
million in 2014.
Background and rationale
The markets for geospatial information and
infrastructure construction, and in particular the
railway segment, are expected to grow significantly
over the coming years. In June 2013, the Norwegian
Parliament approved a NOK 173 billion national
transportation plan for railway for the 2014 - 2023
periods. In Sweden, a SEK 522 billion transportation
plan for the period 2014 - 2025 was adopted by the
Swedish Government in April 2014.
According to Blom's financial budget for 2015, close
to 28 per cent of Blom's revenues is expected to
originate from the Infrastructure segment, up from
20 per cent in 2014, making it Blom's fastest
growing segment. Blom has a strong track-record from
railway projects in the UK and Germany, but has not
equally succeeded in the Scandinavian railway
markets. Team Bane and SJT have firm and long-term
established client relationships, all required
certifications, track-record and construction
capabilities in Norway and Sweden within the railway
sector, and thus bring a platform for successfully
distributing Blom's offerings into the Norwegian and
Swedish markets.
The combination of Team Bane and SJT brings
significant potential for increased utilization of
employees, machinery and equipment across the
Norwegian and Swedish infrastructure market. In
addition, the size of the combined company will
increase the visibility and attractiveness as an
employer and give access to capital. Furthermore,
Team Bane and SJT have identified and are in
dialogue with further potential consolidation
targets.
The combined company
The strategy of NRC Group will be to capitalize on
the strong market growth within infrastructure
construction in the Nordics and geospatial
information in Northern Europe. NRC Group will be
uniquely positioned due to its capabilities covering
the entire value chain required to take on all types
of railway infrastructure projects. The NRC Group
will differentiate through having an asset light,
competence based business model, partnering with the
leading international players and by having the best
specialists in the industry in-house with additional
capacity through in-hiring of resources as needed.
NRC Group delivered combined revenues in 2014 of NOK
954 million and EBITDA of NOK 97 million. In Q1 2015
the group had revenues of NOK 133 million and EBITDA
of -27 million. The first quarter is a seasonally
weak quarter for all three companies. The order
backlog for NRC Group stood at NOK 1,024 million at
the end of Q1 2015.
"I am excited to present the new NRC Group today.
Blom is a company with a sound balance sheet and
profitable growth, in particular from our
infrastructure business. Team Bane and SJT are
exposed to the strongly growing Norwegian and
Swedish railway construction markets, and enable
access for Blom to these key markets. The new NRC
Group will be a leading group which is set to
capture the expected strong growth within
infrastructure, in particular within the railroad
segment. We will have the track-record,
competencies, scale and position required to
succeed", said Trygve Bruland, Chairman of the Board
of Directors of Blom.
NRC Group will announce a new dividend policy and an
employee share investment program in due course
following the Transactions.
The Transactions
As announced on 23 April 2015, the combination
between Blom and Team Bane will be completed as a
share transaction with an exchange ratio of 50-50.
The settlement for the acquisition of SJT will be
made in a combination of NRC Group shares, cash and
a vendor note of SEK 16 million. Post the
Transactions, the current shareholders of Blom, Team
Bane and SJT will own 43.5, 43.5 and 13.0 per cent
of NRC Group, respectively. In addition, the
shareholders of SJT will receive SEK 180 million in
cash payment which will be financed with a committed
bank facility provided by DNB, subject to customary
conditions related to agreement on final loan
documentation and conditions precedent.
Following the Transactions, NRC Group will have 22.2
million shares outstanding and combined net interest
bearing debt of NOK 182 million as at Q1 2015,
adjusted for the new debt related to the
Transactions.
Due diligence has been completed and final
transaction agreements with the shareholders of Team
Bane and SJT have been signed. Completion of the
Transactions is subject to approval from the general
meeting in Blom, scheduled to be held on 28 May
2015. Shareholders holding approximately 74 per cent
of the issued shares in Blom have irrevocably
committed to vote in favor of the Transactions. The
new shares to be issued on completion of the
Transactions to the shareholders of Team Bane and
SJT will be listed on Oslo Børs after the
publication of a prospectus or similar listing
document in accordance with the Norwegian Securities
Trading Act and applicable rules of Oslo Børs,
expected to take place shortly after the general
meeting.
Completion of the Transactions is expected to take
place on or about 28 May 2015.
DNB Markets is acting as financial adviser for NRC
Group. Advokatfirmaet Schjødt AS is acting as legal
advisors to the NRC Group. Aabø-Evensen & Co
Advokatfirma AS is acting as legal advisors to Team
Bane in connection with NRC Group's acquisition of
SJT.
Analyst and investor presentation
A presentation of the Transactions and the NRC Group
for analysts and investors will be arranged on Hotel
Continental, Stortingsgata 24, Oslo at 12:00 CET
today, 7 May 2015. Please register your attendance
by sending an e-mail with your name and company to
ca@dnb.no.
Further information
For further information, please contact:
Trygve Bruland, Chairman of the Board of Directors
of Blom, +47 41146000.
About Blom
Blom is one of Europe's largest aerial survey
companies. It has approx. 400 employees out of which
250 are in the company's production units in Romania
and Indonesia. Blom delivered revenues in 2014 of
NOK 234 million and EBITDA of NOK 15 million.
About Team Bane
Team Bane is a fully integrated rail infrastructure
contractor in Norway, and was established in 2011.
Team Bane has established itself as a leading player
in the Norwegian market with a number 2 position
based on revenues. Team Bane has 128 employees and
delivered revenues in 2014 of NOK 323 million and
EBITDA of NOK 20 million.
About SJT
SJT was established in 1999 and is fully integrated
rail infrastructure contractor in Sweden. SJT has a
number 3 market position in Sweden. SJT has 71
employees and delivered revenues in 2014 of NOK 397
million and EBITDA of NOK 61 million.