eQ CORPORATION STOCK EXCHANGE RELEASE 22.5.2007 at 8.25
STRAUMUR-BURDARAS ACQUIRES THE MAJORITY IN eQ AND MAKES A MANDATORY TENDER OFFER
Straumur-Burdaras Investment Bank hf (“Straumur-Burdaras”) acquires the majority
in eQ Corporation (“eQ”) and has decided to launch a mandatory tender offer for
all of the shares and option rights in eQ. The offer price will be EUR 7.60 for
each share and EUR 5.40 for each option right in eQ. The acquisition value on a
fully diluted basis is EUR 260 million. Straumur-Burdaras will finance the
transaction with available funds.
The Icelandic company Straumur-Burdaras has entered into an agreement to acquire
62 per cent of all shares in eQ for a purchase price of EUR 7.60 per share
payable in cash. Straumur-Burdaras will also make a mandatory tender offer for
all of the remaining shares and option rights in eQ. The offer price payable
under the mandatory tender offer will be EUR 7.60 per share and EUR 5.40 per
option right payable in cash.
The price paid for the eQ shares and to be offered in the mandatory tender offer
represents a premium of approximately 50 per cent compared to the closing price
of the eQ share yesterday and approximately 41 per cent compared to the
volume-weighted average trading price of the share during the last 3-month
period, and a premium of approximately 77 per cent compared to the
volume-weighted average trading price of the share during the last 12-month
period.
Straumur-Burdaras is a leading Icelandic investment bank and besides Iceland it
operates in England, Denmark and the Netherlands. Straumur-Burdaras' strategy is
to become a leading Nordic investment bank. Straumur-Burdaras intends to achieve
this aim by expanding its operations, with a particular focus on the Nordic
countries and the UK, while simultaneously diversifying the bank's income
sources. The acquisition of eQ is an essential step in fulfilling this strategy.
The brokerage, asset management, and corporate finance divisions of eQ have
grown rapidly and successfully. The support of Straumur-Burdaras' strong balance
sheet will enable eQ to grow even faster locally in addition to expanding its
service offering into new geographical areas.
“I am convinced that this acquisition is excellent for our customers, personnel
and shareholders. Although the business of eQ will continue without significant
changes, Straumur-Burdaras' equity base will provide the opportunity to develop
the services of eQ faster on various markets”, states Mr Antti Mäkinen, CEO of
eQ.
Acquiring eQ enables Straumur-Burdaras to reach its strategic objectives faster,
e.g. by adding asset management services to Straumur-Burdaras' product range,
adding the fifth country to the bank's operations, increasing the customer base
by approximately 48 thousand, growing the balance sheet to EUR 6.2 billion, and
increasing fee and net interest income from 43% to 50% of net revenues.
Straumur-Burdaras' shares are listed on the OMX Nordic Exchange in Iceland and
its equity amounted to EUR 1.53 billion on 31 March 2007. Straumur-Burdaras'
market capitalisation was EUR 2.36 billion on 30 April 2007.
Straumur-Burdaras' intention is that eQ will continue as an independent part of
the Straumur-Burdaras Group, with its present name and without significant
changes to its operations. The CEO of eQ and other directors who sold their
shares will continue to work for eQ for at least two years. The synergies
created by the acquisition do not stem from overlapping operations and will
therefore not affect the current terms of employment.
“The acquisition of eQ is a significant step in our strategy implementation”
says Mr Fridrik Johannsson, CEO of Straumur-Burdaras. “eQ is a perfect fit for
further geographical and operational diversification of Straumur-Burdaras,
enabling us to expand into a key market that offers simultaneously a fast
growing economy and a stable environment. We are impressed by the exceptional
team of professionals that will now join us. eQ is the largest domestic
securities broker on the OMX Nordic Exchange in Helsinki and has been known as
the best online securities broker in Finland for several years. This important
addition to our group will enable Straumur-Burdaras to sooner reach its
strategic objective of becoming a leading Nordic investment bank.”
Straumur-Burdaras has received regulatory approval from the Icelandic Financial
Supervision Authority and the completion of the acquisition and the mandatory
tender offer will not be subject to any conditions. The tender offer will be
launched in early June with an acceptance period of three weeks.
The Board of Directors of eQ has evaluated the key terms of the mandatory tender
offer. Based on the information given by Straumur-Burdaras, the Board of
Directors of eQ is not aware of changes in terms of employment or number of jobs
in eQ as a result of the mandatory tender offer. Based on a valuation of eQ
contracted by the Board of Directors, the Board of Directors considers the offer
fair from a financial point of view to the shareholders and holders of option
rights. Considering also that Straumur-Burdaras has acquired the majority in eQ,
the Board of Directors recommends the shareholders and holders of option rights
to accept the mandatory tender offer. The recommendation is given assuming that
no better offer will be made during the tender offer period. The Board of
Director notes, however, that each shareholder and holder of option rights shall
independently decide whether to accept the offer of Straumur-Burdaras taking
into consideration all information to be presented in Straumur-Burdaras' tender
offer document and possible other matters affecting the tender offer.
The Board of Directors of eQ will issue its full statement of the mandatory
tender offer as required in Chapter 6, Section 6 of the Finnish Securities
Market Act after release of the tender offer document.
Straumur-Burdaras has entered into the agreement to purchase in aggregate 62 per
cent of the shares in eQ with the following shareholders: Fennogens Investments
S.A., Notalar Oy, ANHA Benelux SPRL, Leenos Oy, Oy Cevante Ab and Oy Kambisi Ab.
eQ will host a press conference which will take place in the headquarters of eQ
today at 11:00 am at Mannerheiminaukio 1 A, 00100 Helsinki. Welcome!
eQ Corporation
For more information:
Antti Mäkinen tel. +358 9 6817 8686
CEO Mobile +358 50 561 1501
eQ Corporation email antti.makinen@eQ.fi
Fridrik Johannsson tel. +354 664 7801
CEO
Straumur-Burdaras Investment Bank hf
DISTRIBUTION
Helsinki Stock Exchange
Main media
www.eQ.fi
INFORMATION REGARDING STRAUMUR-BURDARAS
Straumur-Burdaras Investment Bank hf is Iceland's largest investment bank.
Straumur-Burdaras offers integrated corporate and investment banking services in
Northern Europe, with particular focus on the Nordic countries and the UK.
Straumur-Burdaras' services include corporate finance advisory, debt and equity
financing, and brokerage.
INFORMATION REGARDING eQ
eQ is a Finnish full-service investment bank, the customers of which consist of
private investors, institutions and companies. eQ provides and develops
efficient and customer oriented investment banking services for demanding
customers. The shareholder's equity of eQ Group is EUR 64 million and the
capital adequacy ratio 14 %. The Group has 170 employees and approximately
48.000 customers.
The tender offer is not being made directly or indirectly in any jurisdiction
where prohibited by applicable law and this release may not be distributed,
forwarded or transmitted into or from any jurisdiction where prohibited by
applicable law by any means whatsoever including, without limitation, mail,
facsimile transmission, e-mail or telephone.