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Asker, 12 February 2025. Argeo ASA (“Argeo” or the “Company”) has engaged Pareto Securities AS and SpareBank 1 Markets AS as joint global coordinators and joint bookrunners (the “Managers”) to advise on and effect a contemplated private placement of new shares (the “Offer Shares”) in the Company (the “Private Placement”) to raise gross proceeds of approx. NOK 150 million (the “Offer Size”).
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The subscription price per Offer Share in the Private Placement (the “Offer Price”) and the final number of Offer Shares will be determined by the Company’s board of directors (the “Board”) on the basis of an accelerated bookbuilding process to be conducted by the Managers.
Use of proceeds:
The net proceeds to the Company from the Private Placement will be used to finance (i) acquisition of long-lead equipment for vessel positioned as #1 bidder for a 4-year contract, (ii) geotechnical equipment to enable Argeo’s service offering on long-term frame agreements, and (iii) general corporate purposes:
i) Argeo is positioned for a 4-year IMR contract in South America and the Company will purchase long-lead items for this likely contract.
ii) 80% of Argeo’s integrated site investigation projects includes geotechnical services which typically consists of 15% of the total contract value. These services are currently subcontracted out and build-up of inhouse capability will give long-term competitive advantage as well as short payback time as geotechnical services are important parts of our long-term frame agreements.
Company update:
- Argeo Venture is currently on a 10-month contract with Total Energies in Namibia scheduled to be completed mid-march 2025. The vessel had a 60-day yard stay in Q4 2024 for installation of equipment.
- Argeo Searcher worked multiclient in Suriname where revenues are only recognized once the data has been processed and sold.
- Q4 2024 revenues will be USD 5 million, down from USD 23 million in Q3 2024, and EBITDA will be negative USD 5.7 million, down from positive USD 5.4 million.
The Company has since been awarded a 5-year site investigation frame agreement with Total Energies, and an 8-year multiclient agreement with Staatolie of Suriname, in addition to being positioned for 4-year contract in Brazil, final award expected Q1 2025.
Per 31 December 2024, firm backlog was USD 14 million for execution in Q1 2025.
Argeo currently has a total expected backlog of USD ~190 million, including contracts in final negotiation stage. The Company estimates 30% EBITDA-margin implying an estimated EBITDA backlog of USD 57 million, exceeding net debt & leases of USD 44.6 million. Argeo believes its Q2 and Q3 2024 EBITDA are more representative for 2025 than Q4 2024, which implies an annualized run-rate of USD ~20 million.
See further information in the attached investor presentation dated 12 February 2025.
Pre-commitments:
Kistefos AS (the largest shareholder in the Company with approx. 20.04% of the outstanding shares) has pre-committed to subscribe for, and will be allocated, its pro-rata share in the Private Placement, which is equivalent to approx. NOK 30 million.
Bookbuilding period:
The bookbuilding period in the Private Placement will commence today, 12 February 2025 at 16:30 CET (after close of markets) and is expected to close on 13 February 2025 at 08:00 CET (before opening of markets) (the “Bookbuilding Period”). The Company may, however, in consultation with the Managers, at any time resolve to shorten or extend the Bookbuilding Period on short or without notice. If the Bookbuilding Period is shortened or extended, any other dates referred to herein may be amended accordingly.
Offering structure:
The Private Placement will be divided in two tranches.
Tranche 1 (“Tranche 1”) will consist of up to 8,875,000 Offer Shares (the “Tranche 1 Shares”), which is within the maximum number of shares the Company’s Board may issue pursuant to the authorization granted by the annual general meeting in the Company on 6 June 2024 (the “Board Authorisation”).
Tranche 2 (“Tranche 2”) will consist of a number of Offer Shares that, together with the Tranche 1 Shares, corresponds to a total transaction (i.e. both tranches) equal to the Offer Size (the “Tranche 2 Shares”, which will be issued by an extraordinary general meeting in the Company (the “EGM”) to be summoned shortly after notification of allocation in the Private Placement.
Allocation:
Allocation of Offer Shares will be determined at the end of the Bookbuilding Period by the Board, at its sole discretion (in consultation with the Managers). The Company may focus on allocation criteria such as (but not limited to) pre-commitments, indications from the pre-sounding phase of the Private Placement, existing ownership in the Company, price leadership, timeliness of the application, relative order size, sector knowledge, perceived investor quality and investment horizon. The Board may, at its sole discretion, reject and/or reduce any applications. There is no guarantee that any applicant will be allocated Offer Shares.
Applicants will receive a pro rata portion of Offer Shares in Tranche 1 and Tranche 2 based on their overall allocation in the Private Placement except for Kistefos AS which will receive its entire allocation in Tranche 2. The Company will seek to accommodate applicants who request to be allocated Offer Shares in Tranche 2 (implying that other investors may receive a larger portion of their allocation in Tranche 1).
Notification of allocations are expected to be issued by the Manager to the applicants on or about 13 February 2025 before 09:00 CET (before opening of markets).
Settlement:
The delivery vs. payment (DVP) settlement structure in Tranche 1 and Tranche 2 is expected to be facilitated through the delivery of existing and unencumbered shares in the Company, already admitted to trading on Oslo Børs, pursuant to a share lending agreement between the Company, the Managers, and certain existing shareholders (the “Share Lending Agreement”). The Offer Shares in Tranche 1 will thus become tradable on Oslo Børs directly after the notification of allocation expected on or about 13 February 2025 before 09:00 CET (T), and the Offer Shares in Tranche 2 will become tradable after a resolution by the EGM expected on or about 6 March 2025 (T + 3 weeks = X). The allocation to Kistefos AS in Tranche 2 may if necessary be treated separately in connection with the settlement process.
The date for settlement for Tranche 1 is expected to be on or about 17 February 2025 (DVP T+2) and settlement for Tranche 2 is expected to be on or about 10 March 2025 (DVP X+2), subject to any shortening or extensions of the Bookbuilding Period.
The Share Lending Agreement for Tranche 1 and Tranche 2 will be settled through the redelivery of (i) new shares in the Company to be resolved issued by the Board pursuant to the Board Authorization (Tranche 1), and (ii) new shares in the Company to be issued after a resolution by the EGM (Tranche 2). The new shares to be redelivered to the share lenders in accordance with the Share Lending Agreement in Tranche 2 will be issued on a separate ISIN and will not be tradable on Oslo Børs until a listing prospectus has been approved by the Financial Supervisory Authority of Norway and published by the Company.
The completion of Trance 1 is subject to (i) a resolution by the Board to issue the Offer Shares in Tranche 1 pursuant to the Board Authorization, and (ii) the Share Lending Agreement for Tranche 1 being unmodified and in full force and effect. The completion of Tranche 2 is subject to (i) the completion of Tranche 1, (ii) a resolution by the EGM to issue the Offer Shares in Tranche 2, and (iii) the Share Lending Agreement for Tranche 2 being unmodified and in full force and effect. Further to this, completion of both Tranche 1 and Tranche 2 in the Private Placement is subject to the Board resolving to consummate the Private Placement and allocate the Offer Shares. Completion of Tranche 1 is not conditional upon completion of Tranche 2. The settlement of Offer Shares under Tranche 1 will remain final and binding and cannot be revoked, cancelled or terminated by the respective applicants if Tranche 2 is not completed.
Potential subsequent repair offering:
The Board of Directors has considered the Private Placement in light of the equal treatment obligations under the Norwegian Securities Trading Act section 5-14, section 2.1 of Euronext Oslo Rule Book II and Oslo Børs’ Circular no. 2/2014, and is of the opinion that the proposed Private Placement is in compliance with these requirements. The equity issuance will be carried out as a private placement in order to complete a transaction in an efficient manner to strengthen the Company’s balance sheet. On this basis, and based on an assessment of the current equity markets, the Company’s need for equity funding, deal execution risk and possible alternatives, the Board of Directors has considered the Private Placement to be in the common interest of the Company and its shareholders. As a consequence of the overall transaction structure, the shareholders’ preferential rights will be deviated from.
The Company may, subject to completion of the Private Placement and certain other conditions, decide to carry out a subsequent repair offering of new shares at the Offer Price in the Private Placement which, subject to applicable securities law, will be directed towards existing shareholders in the Company as of 12 February 2025 (as registered in the VPS two trading days thereafter), who (i) were not included in the pre-sounding phase of the Private Placement, (ii) were not allocated Offer Shares in the Private Placement, and (iii) are not resident in a jurisdiction where such offering would be unlawful or would (in jurisdictions other than Norway) require any prospectus, filing, registration or similar action.
Selling restrictions:
The Private Placement will be made by the Company to investors subject to applicable exemptions from relevant prospectus requirements in accordance with Regulation (EU) 2017/1129 and the Norwegian Securities Trading Act of 2007 (the “STA”) and is directed towards investors subject to available exemptions from relevant registration requirements, (i) outside the United States in reliance on Regulation S under the US Securities Act of 1933 (the “US Securities Act”) and (ii) in the United States to “qualified institutional buyers” (QIBs) as defined in Rule 144A under the US Securities Act, pursuant to an exemption from the registration requirements under the US Securities Act as well as to major U.S. institutional investors under SEC Rule 15a-6 to the United States Exchange Act of 1934. The minimum subscription and allocation amount in the Private Placement will be a number of Offer Shares corresponding to the NOK equivalent of EUR 100,000. The Company may, however, at its sole discretion, offer and allocate an amount below EUR 100,000 to the extent applicable exemptions from the prospectus requirements pursuant to the Norwegian Securities Trading Act and ancillary regulations are available, including to employees and directors of the Company and the Company group.
Further selling restrictions and transaction terms will apply.
Legal advisors:
AGP Advokater AS is acting as legal counsel to the Company.
This information is considered to be inside information pursuant to the EU Market Abuse Regulation (MAR) and is subject to the disclosure requirements pursuant to MAR article 17 and section 5 -12 of the Norwegian Securities Trading Act. This stock exchange notice was published by Odd Erik Rudshaug, Chief Financial Officer, at Argeo ASA on the date and time provided.
For more information, please contact:
Trond Figenschou Crantz, CEO
Email: trond.crantz@argeo.no
Phone: +47 976 37 273
About Argeo:
Argeo is a comprehensive subsea service provider, operating across three major sectors: Oil & Gas, Marine Minerals, and Renewables. The Company offers a unique package that integrates robust vessels, state-of-the-art autonomous underwater vehicles (AUVs), advanced sensors, digital imaging technology, and an intuitive digital platform designed to collect and visualize complex data.
With their own vessels and high-performance AUVs, Argeo delivers fast and flexible full-lifecycle services, including survey, inspection, maintenance, and repair, aimed at improving efficiency and reducing the carbon footprint for global, industry-leading clients.
Founded in 2020, Argeo has established offices in Asker (Oslo), Edinburgh, Houston, and Rio de Janeiro.
The company is listed on Euronext Oslo Børs (main regulated marketplace on the Oslo Stock Exchange) under the ticker: ARGEO.
Please visit www.argeo.no for more information.
Important notice:
This announcement is not and does not form a part of any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. Copies of this announcement are not being made and may not be distributed or sent into any jurisdiction in which such distribution would be unlawful or would require registration or other measures.
The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and accordingly may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any part of the offering in the United States or to conduct a public offering of securities in the United States. Any sale in the United States of the securities mentioned in this announcement will be made solely to “qualified institutional buyers” as defined in Rule 144A under the Securities Act.
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, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State. The expression “Prospectus Regulation” means Regulation (EU) 2017/1129 as amended (together with any applicable implementing measures in any Member State.
This communication is only being distributed to and is only directed at persons in the United Kingdom that are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”) or (ii) high net worth entities, and other persons to whom this announcement may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only for relevant persons and will be engaged in only with relevant persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.
Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as “believe”, “expect”, “anticipate”, “strategy”, “intends”, “estimate”, “will”, “may”, “continue”, “should” and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believe that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict, and are beyond their control. Actual events may differ significantly from any anticipated development due to a number of factors, including without limitation, changes in public sector investment levels, changes in the general economic, political and market conditions in the markets in which the Company operates, the Company’s ability to attract, retain and motivate qualified personnel, changes in the Company’s ability to engage in commercially acceptable acquisitions and strategic investments, and changes in laws and regulation and the potential impact of legal proceedings and actions. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The Company does not make any guarantee that the assumptions underlying the forward-looking statements in this announcement are free from errors nor does it accept any responsibility for the future accuracy of the opinions expressed in this announcement or any obligation to update or revise the statements in this announcement to reflect subsequent events. You should not place undue reliance on the forward-looking statements in this announcement.
The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice. The Company does not undertake any obligation to review, update, confirm, or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this announcement.
Neither the Managers nor any of their respective affiliates makes any representation as to the accuracy or completeness of this announcement and none of them accepts any responsibility for the contents of this announcement or any matters referred to herein.
This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company. Neither the Managers nor any of their respective affiliates accepts any liability arising from the use of this announcement.
The distribution of this announcement and other information may be restricted by law in certain jurisdictions. Persons into whose possession this announcement or such other information should come are required to inform themselves about and to observe any such restrictions.
Kilde
