The boards of directors of Kaupthing Bank hf. ("Kaupthing") and the Reykjavik
Savings Bank hf. ("SPRON") have agreed on a merger schedule, according to which
Kaupthing will take over SPRON's assets and liabilities by a merger. The merger
will have an insignificant impact on Kaupthing's total size on a consolidated
basis.
Upon the merger, SPRON shareholders will receive a payment which is equivalent
to the market price of shares in SPRON at the close of trading on 30 June 2008
plus a 15% premium. This equates to payment of ISK 3.83 for each share in
SPRON. The payment will be structured as follows: 60% will be in the form of
shares in Exista hf. and 40% will be in the form of shares in Kaupthing.
In the opinion of the boards of directors of Kaupthing and SPRON, the merger
will have a positive impact on the operations of both companies in Iceland. It
will improve services and increase the profitability of operations and value
for the companies' shareholders. The financial market unrest of the past months
has highlighted the need to place greater emphasis on improving operating
efficiency and reining in costs of financial companies. The integration of
Kaupthing and SPRON is a response to the changing operating environment and
will strengthen the operations of both companies in the Icelandic financial
market. Upon merging, emphasis will be placed on maintaining the special status
and market positions of both companies. The branches of both banks will
continue to operate under their own brand names.
Conditions of the merger, SPRON shareholders' meeting and timing of the merger
The merger is subject to the approval of a shareholders' meeting in SPRON and
the Icelandic Financial Supervisory Authority. The merger is also subject to
the competition authorities not rejecting it or imposing conditions which the
boards of directors of the companies consider unacceptable or which would make
it inevitable to resubmit the merger proposal to a SPRON shareholders' meeting.
The creditors' approval of the merger has already been obtained. The SPRON
shareholders' meeting is scheduled for the beginning of August. The opinion of
an external financial company on the payment to be made for the share capital
in SPRON in the merger will be submitted at that meeting.
The merged company will not assume the operations, assets and liabilities, or
the rights and obligations of SPRON until all the conditions of the merger have
been met.
Payment to SPRON shareholders
Upon the merger, shareholders in SPRON will receive 0.002007864 shares in
Kaupthing Bank hf. and 0.305585106 shares in Exista hf. as payment for each
share of a nominal value of ISK 1 in SPRON. No payment will be made for SPRON
own shares. SPRON shareholders will be given the option of exchanging the said
shares internally, through Kaupthing's intermediation, free of commission for
two weeks after the settlement of the acquisition price, at the market price
current at that time. The price corresponds to the listed closing price of
Kaupthing and Exista shares on 30 June 2008, or ISK 763 for each share in
Kaupthing and ISK 7.52 for each share in Exista. The payment to SPRON
shareholders is equivalent to ISK 3.83 for each share in SPRON and will be paid
to SPRON shareholders once the conditions of the merger have been met.
Kaupthing has made an agreement on the acquisition of 832,737,199 Exista shares
from SPRON (340,965,708 shares), on the one hand, and the Kista Investment
Company (Kista-fjárfestingarfélag) (491,771,491 shares) on the other, which
will be used as payment in the merger, and the acquisition of these shares is
subject to the same conditions as the merger itself. The price of the shares in
this transaction is based on the above price, i.e. the listed closing price of
Exista shares on 30 June 2008, or ISK 7.52 for each share.
The merged company
There will be no changes to Kaupthing's articles of association following the
merger nor to its listing on the OMX Nordic Exchange in Iceland or in
Stockholm. No new share capital will be issued by Kaupthing in connection with
this merger. The subsidiaries of SPRON will become the subsidiaries of the
merged company.
Company data as of 31 March 2008
Kaupthing SPRON
Equity ISK 416.9 billion ISK 17.8 billion
Total assets ISK 6,368.4 billion ISK 254.7 billion
Number of employees 3,324 295
Key dates
• Merger schedule approved by the boards of directors of both companies on 1
July 2008.
• SPRON's shareholders' meeting is scheduled for the beginning of August.
• The merged company will assume the operations, assets and liabilities, as
well as the rights and obligations of SPRON once all of the conditions of the
merger have been met.
For further information please contact:
Ingólfur Helgason, CEO of Kaupthing in Iceland, tel. +354 444-6121
Gudmundur Hauksson, CEO of SPRON, tel. +354 550-1200
Jónas Sigurgeirsson, Chief Communications Officer, +354 444 6112 or
ir@kaupthing.com
Jóna Ann Pétursdóttir, Head of Public Relations at SPRON, tel. +354 840-8225 or
ir@spron.is
About Kaupthing Bank
Kaupthing Bank is a northern European bank offering integrated financial
services to companies, institutional investors and individuals. Kaupthing
operates in fourteen countries, including all of the Nordic countries,
Luxembourg, Belgium, the United Kingdom and the Isle of Man, Switzerland,
Germany, the United States, the Dubai International Financial Centre (DIFC) and
the Qatar Financial Centre (QFC). Kaupthing also has a retail banking operation
in Iceland with 34 branches across the country. Its headquarters are in
Reykjavík.
About SPRON
SPRON is a financial institution which offers retail and investment banking
services to individuals, businesses and professional investors in the greater
Reykjavik area. SPRON's main subsidiaries are SPRON Securities, SPRON
Factoring, Netbankinn and the Frjálsi Investment Bank. SPRON operates seven
branches in the capital area.
