STJ advises Nordic Capital on a SEK1.74bn (US$181m) accelerated bookbuilt placement in Munters Group AB
STJ continued its extremely successful advice to Nordic Capital in relation to Munters Group AB by completing an accelerated bookbuilt placement of 40 million shares raising SEK1.74bn (US$181m) on Wednesday 6th November. The placement represented 21.8% of Munters’ issued capital, c. 60% of Nordic Capital’s holding and 187 days average trading volume.
This was the second placement by Nordic Capital in Munters since its IPO in June 2017, following a first trade in June 2019, also advised by STJ. Since our engagement in2018, the Munters’ share price has appreciated 65% (against global markets up c. 1.5% in USD).
The ABB placement followed the Company’s Q3 2019 results and the appointment of a new management team. STJ provided critical advice around timing, size and ultimate pricing tactics to achieve an optimal transaction (in terms of both size and price) for all stakeholders.
Despite generally good share price momentum and overall positive and stable macro in the weeks prior to the trade, STJ recommended a 10 day delay in the transaction post the Q3 announcement to avoid any demand issues in the Nordics (due to Swedish holidays) and to ensure a well-anchored and locally supported transaction with the best price and size dynamics for Nordic Capital.
The recommendation to launch on Tuesday 5th November was based on a clear view of:
- a key anchor in the book (representing c. 43% of the base deal and 32% of the ultimate deal) on the back of a limited wall-crossing, and
- strong local Swedish and Nordic long-only investors and additional demand from international funds on the back of a broad wall-crossing exercise.
The broader wall-cross minimised market risk, enabled a same day transaction and maximised visibility on size and price from investors pre-launch.
The transaction was officially launched post-close without specific price guidance but with size guidance of “c. 20% of the company’s market cap” and a clear statement that “indications of interest had been received covering the entire transaction”. These tactics produced significant demand momentum into the book and enabled price to be tightened above the initial anchor indication.
Books were covered within 30 minutes of launch and closed 2 hours after launch, 2x oversubscribed. The deal was placed with a strong group of quality long-only local investors and a range of new and existing international investors. It was very tightly allocated with the top 10 investors (mostly long-only investors) taking 79% of the book. Allocations were skewed to long-only investors taking 85% of the book.
The offer was priced at a 5.9% discount to close and a 4% premium to the 3-months VWAP with a share price that had rallied in the prior weeks and into close. The shares opened 1.8% up relative to pricing and traded well above pricing, ending the day at SEK45.36; 4.3% above the pricing level of SEK43.5.