NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, WITHIN OR TO THE UNITED STATES, THE UNITED KINGDOM, AUSTRALIA, HONG KONG, JAPAN, CANADA, SWITZERLAND, SINGAPORE, SOUTH AFRICA OR NEW ZEALAND OR ANY OTHER JURISDICTION WHERE THE DISTRIBUTION OR PUBLICATION OF THIS PRESS RELEASE WOULD BE UNLAWFUL OR WOULD REQUIRE REGISTRATION OR ANY OTHER MEASURES
Stillfront Group AB (publ) (“Stillfront”), a leading free-to-play powerhouse of gaming studios, has completed the acquisition of the first tranche of the shares in Nanobit, d.o.o, representing 78% of the shares in Nanobit, (the “First Tranche Transaction”) which was announced through a press release on 17 September 2020. The sellers are the joint founders and main owners of Nanobit, Alan Sumina and Zoran Vučinić, as well as certain key employees (the “Sellers”).
The consideration for the First Tranche Transaction, which has been paid to the Sellers of Nanobit on the date hereof, amounted to approx. USD 100 million, on a cash and debt free basis. Of the consideration, approx. USD 30 million was paid by way of set-off against transfer of 280,542 newly issued shares in Stillfront through a directed share issue to the two founders of Nanobit, Alan Sumina and Zoran Vučinić (the “Founders”), and the remaining approx. USD 70 million was paid in cash to the Sellers. The new share issue was resolved by the Board of Stillfront based on the mandate granted at the annual general meeting held on 14 May 2020. Through the new share issue, Stillfront’s share capital will increase by SEK 196,379.4. The reason for the deviation from the shareholders’ pre-emption rights was to allow Stillfront to fulfill its commitments made in connection with the acquisition of Nanobit and payment under the First Tranche Transaction. The subscription price per share was SEK 937.076, determined through negotiations with the Sellers, and corresponds to the volume weighted average price of Stillfront’s share for a period of ten (10) trading days preceding 17 September 2020 (excluding 17 September 2020) on Nasdaq First North Premier Growth Market and a USD/SEK exchange rate of 8.763 corresponding to the average exchange rate between SEK and USD of the Swedish Central Bank (Sw. Sveriges Riksbank) published at https://www.riksbank.se/en-gb/ during the same period. The newly issued shares were subscribed and paid for on the date hereof. Payment was made by way of set-off. The newly issued shares shall be entitled to dividend as from the first record day for dividend after such shares have been registered with the Swedish Companies Registration Office and in the share register kept by Euroclear Sweden AB. Through the new issue of the shares in connection with the completion of the First Tranche Transaction, the Founders of Nanobit, collectively hold approx. 0.81 percent of the outstanding shares and votes in Stillfront, and consequently, the dilution for the current shareholders in Stillfront is 0.81 percent. All conditions for closing of the First Tranche Transaction have now been fulfilled.
The closing of the acquisition of the remaining 22% of the shares in Nanobit (the “Second Tranche Transaction”) will occur in 2023 for a consideration which is depending on the EBITDA development of Nanobit for the financial years 2021 and 2022 but however not exceeding USD 48 million on a cash and debt free basis, out of which 70% shall be paid in cash and 30% in newly issued shares in Stillfront. The consideration for the Second Tranche Transaction is payable upon completion of the Second Tranche Transaction in 2023.
The total purchase price payable by Stillfront in relation to all shares in Nanobit cannot exceed USD 148 million on a cash and debt free basis.
Due to that Stillfront will acquire the remaining 22% of the shares in the Second Tranche Transaction, Stillfront and the Founders have as of today entered into a shareholders’ agreement. The shareholders’ agreement has been entered into in order to establish certain terms and conditions regarding the business of Nanobit and in order to regulate the internal relationship between Stillfront and the Founders with respect to ownership of shares in and governance of Nanobit. The shareholders’ agreement will be terminated when consideration under the Second Tranche Transaction has been paid and Stillfront is the owner of 100% of the shares in Nanobit.
Further, Stillfront and the Founders have as of today entered into a share pledge agreement in which the remaining shares in Nanobit to be purchased in the Second Tranche Transaction has been pledged to Stillfront by the Founders.
Nanobit will be consolidated into Stillfront’s consolidated financial reporting from 1 October 2020.
The release, announcement or distribution of this press release may, in certain jurisdictions, be subject to restrictions. The recipients of this press release in such jurisdictions, in which this press release has been released, announced or distributed, should inform themselves of and follow such restrictions. The recipient of this press release is responsible for using this press release, and the information contained herein, in accordance with applicable rules in each jurisdiction. This press release does not constitute an offer, or a solicitation of any offer, to buy or subscribe for any securities in Stillfront in any jurisdiction, neither from Stillfront nor from someone else.
This press release does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the new shares. Any investment decision in connection with the share issue must be made on the basis of all publicly available information relating to Stillfront and Stillfront’s shares. Such information has not been independently verified by Stillfront. The information contained in this press release is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this press release or its accuracy or completeness.
This press release does not constitute a recommendation concerning any investor’s option with respect to the share issue. Each investor or prospective investor should conduct his, her or its own investigation, analysis and evaluation of the business and data described in this press release and publicly available information. The price and value of securities can go down as well as up. Past performance is not a guide to future performance.
This press release does not constitute or form part of an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be sold in the United States absent registration or an exemption from registration under the US Securities Act of 1933 (the "Securities Act"), as amended, and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a Transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States. The information in this press release may not be announced, published, copied, reproduced or distributed, directly or indirectly, in whole or in part, within or into, Australia, Canada, Japan, Hong Kong, New Zealand, Singapore, South Africa, Switzerland, the United States or in any other jurisdiction where such announcement, publication or distribution of the information would not comply with applicable laws and regulations or where such actions are subject to legal restrictions or would require additional registration or other measures than what is required under Swedish law. Actions taken in violation of this instruction may constitute a crime against applicable securities laws and regulations.
This announcement is not a prospectus for the purposes of Regulation (EU) 2017/1129 (the "Prospectus Regulation") and has not been approved by any regulatory authority in any jurisdiction. Stillfront has not authorized any offer to the public of shares or rights in any member state of the EEA and no prospectus has been or will be prepared in connection with the Share Issue. 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 Prospectus Regulation.
In the United Kingdom, this press release and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, “qualified investors” who are (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.
Information to distributors
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended (“MiFID II”); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the “MiFID II Product Governance Requirements”), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any “manufacturer” (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the shares in Stillfront have been subject to a product approval process, which has determined that such shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the “Target Market Assessment”). Notwithstanding the Target Market Assessment, distributors should note that: the price of the shares in Stillfront may decline and investors could lose all or part of their investment; the shares in Stillfront offer no guaranteed income and no capital protection; and an investment in the shares in Stillfront is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Share Issue.
For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the shares in Stillfront.
Each distributor is responsible for undertaking its own target market assessment in respect of the shares in Stillfront and determining appropriate distribution channels.