RNS Number:5939F
ASBISc Enterprises PLC
11 October 2007
ASBISc Enterprises PLC
(the "Company")
ASBISC ENTERPRISES PLC PUBLISHED ITS OFFERING PROSPECTUS
ASBISC Enterprises Plc (ASBIS), one of the leading distributors of IT products
in Central and Eastern Europe, the Baltic States, the former Soviet Union, the
Middle East and North Africa announces that it has published its offering
prospectus. Based on the Maximum Price the company plans to raise approximately
PLN 82,9 mln to implement its development strategy. The offering, will also
involve a partial sell down by some of the existing shareholders, and the
overall offer value might amount up to PLN 234 mln.
* The Offer comprises in aggregate 21,205,144 Offer Shares, representing
7,500,000 New Shares to be issued and offered by the Company and 10,939,256
Sale Shares to be offered by the Selling Shareholders. The key Selling
Shareholders are MAIZURI Enterprises Ltd. and Alfa Ventures S.A. and KS
Holdings Limited. The shares will be offered to Polish and foreign
institutional investors, as well as to Polish retail investors.
In addition, KS Holdings Limited has granted the Global Coordinator an
Over-allotment Option covering up to an additional 2,765,888 Offer Shares,
representing up to 15 per cent. of the base aggregate number of the Offer
Shares, to cover over-allotments, if any, made in connection with the Offer
and to cover short positions resulting from stabilisation transactions at
the WSE (greenshoe).
* The Offer Shares are divided into two tranches:
- the Retail Tranche of 2,650,000 Offer Shares, intended for Retail
Investors;
- the Institutional Tranche containing all the remaining 18,555,144 Offer
Shares, including up to 2,765,888 Sale Shares, offered under the
Over-allotment Option and intended for Institutional Investors.
* Depending on the demand, shares may be shifted between tranches.
* The book-building process for Polish and international institutional
investors will take place between 10 October and 18 October (until 18.00
Warsaw time) and will be handled by ING.
* The period in which retail investors may file subscriptions will commence on
10 October 2007 and will end on 18 October 2007, at 17.00 (Warsaw time).
Subscriptions can be filed at the Customer Service Desks of ING Securities
S.A.; the Order Placement Points operated by DM Polonia Net S.A. and BM
Nordea Bank; the Customer Service Desks of DM BZWBK and the Order Placement
Points of Biuro Maklerskie Banku BPH S.A.
* The Maximum Price per share is PLN 11.05.
The indicative Price Range for the Offer has been set at PLN 7,50 (USD 2,8)
to PLN 9,20 (USD 3,4) per share.
* The Offer Price will be determined by the Company and the Selling
Shareholders upon the recommendation of the Managers after the termination
of the Subscription Period not later than on 19 October 2007 taking into
account the results of book-building amongst the institutional investors.
* Allotment will occur promptly following the Subscription Period, not later
than on 19 October 2007, subject to acceleration or extension of the
timetable for the offer at the discretion of the Company and the Selling
Shareholders.
* The principal use of the proceeds from new shares issued by ASBIS is to
invest in the further development of the Group's own brands of IT equipment
- Prestigio and Canyon, enabling the Group to take advantage of early
payment discounts offered by certain suppliers and expanding the range of
branded end-user products offered by the Company.
* The Offer Shares are expected to be listed on the Warsaw Stock Exchange
around 30 October 2007.
* The Company's advisors during the IPO process are: ING (Global Manager of
the Offer), ING Securities, Dewey & LeBoeuf and Deloitte and Touche.
ASBIS STRATEGY
The Group's strategy is aimed at expanding business and boosting profitability,
to be achieved by enhancing the operating efficiency of computer component
distribution and by increasing sales under private labels. The Group intends to
meet these objectives through:
- increasing sales and market share in the EMEA region;
- expanding into new emerging markets;
- developing its private label business;
- continuing to focus on leveraging its size and distribution capacity to secure
better commercial terms and to optimise its product mix; and
- enhancing operating efficiency and automated processes, including its on-line
sales channels.
Increasing sales and market share in the EMEA region
As confirmed by independent market reports produced by Gartner, computer
penetration in the markets in which the Group operates is still significantly
lower than in more developed Western European markets. As a result, demand for
computer products in these markets is growing rapidly and the Company expects it
to continue to grow at a high rate in the foreseeable future. The Group will
continue to focus on increasing its revenue and market share in these growing
markets and believes that it is in an advantageous position to do so, due to its
relationships with leading international suppliers, extended distribution
network and strong local presence.
Expansion into new emerging markets
In recent years, the Group has entered a number of new emerging IT markets in
North Africa. Although revenues derived from these markets still represent a
relatively low share of the Group's total revenues, this share is increasing, as
these markets continue to grow and as the Group continues to expand to other
emerging and growing markets including in Africa and Central Asia (in particular
countries such as Libya, Kenya, as well as Moldova, Azerbaijan, Georgia and
Armenia). The Group expects that its long experience of successfully competing
in emerging, high-growth markets, combined with the geographic proximity of its
headquarters to these markets, will help it strengthen its market position and
increase its revenues.
Development of private label business
The Group's private label (branded) product lines, Canyon and Prestigio, are
manufactured by leading OEM producers in the Far East (i.e., Korea, Taiwan, and
China), often based on designs developed by the Group, selected on the basis of
their quality and potential for achieving high profit margins in the Group's
markets. The Group markets and sells these products under its own brands,
successfully competing with products of comparable quality marketed under
international brands. The Group believes that increasing sales of private label
products as part of its total revenues will have a positive impact on its
overall profitability, as these products return a higher profit margin, compared
to international suppliers' products distributed by the Group. As a result, the
Group aims to continue expanding the range of its private label products and
strengthening their promotion in its markets.
Continuing to focus on leveraging its size and distribution capacity to achieve
better commercial terms and to optimize its product mix
The Group's local presence in a number of markets in which it operates and the
size and breadth of its operations, combined with its centralized procurement
system for negotiating with suppliers, help increase the Group's purchasing
power and strengthen its ability to negotiate and achieve more beneficial terms
in its distribution agreements, including achieving agreements with respect to
the distribution of products offering higher profit margins.
Enhancing operating efficiency and automated processes, including its on-line
sales channels
The Group continues to focus on improving operating efficiency and enhancing its
automated processes, with a view to reducing operating expenses and increasing
its profit margins, mainly through enhancing its own on-line, end-to-end supply
chain management system, which operates over its IT4Profit platform. This
automated system covers a wide range of Group activities, from purchasing
processes with key suppliers, to intercompany transactions, order processing and
business data exchange with customers, as well as automated B2C
(business-to-customer) connection with e-shops of resellers. Approximately half
of the Group's revenues were derived from on-line transactions with customers in
2006, and the Group aims to increase this percentage.
USE OF PROCEEDS FROM THE OFFER
Based on the Maximum Price, the Company may raise up to approximately PLN 82.9
million (approximately U.S(1). $29.6 million). The net proceeds from the sale of
the New Shares, after paying commissions, fees and expenses associated with the
preparation of the Offer and the sale of New Shares, will be used (in the order
of priority) for the purposes of:
Purpose of use of proceeds Amount
Further developing the Group's own brands of IT equipment - up to PLN
Prestigio and Canyon 39.1 mln
Enabling the Group to take advantage of early payment discounts up to PLN
offered by some of the Group's key suppliers 21.8 mln
Expansion of the range of branded end-user products offered by the up to PLN
Company, including necessary working capital requirements in this 15.4 mln
respect
Completion of a purchase of a building in Slovakia, serving as a up to PLN 2
headquarters of a local subsidiary mln
- Further developing the Group's own brands of IT equipment - Prestigio and
Canyon - by investing in their marketing, design, sourcing and quality control
- up to approximately PLN 39.1 million (approximately U.S.$ 14.0 million).
Marketing of the Prestigio and Canyon brands will aim at increasing
customer and product awareness which will be achieved via various marketing
activities such as advertising, publishing of promotional materials, product
presentations and other marketing activities. The Group expects to gain
significant strategic and commercial advantages from the development of its own
brands and is committed to supporting growth of both Canyon and Prestigio
brands;
- Enabling the Group to take advantage of early payment discounts offered by
some of the Group's key suppliers, such as Seagate Technologies and
Hitachi Global Storage, thus enhancing its bottom line performance - up to
approximately PLN 21.8 million (approximately U.S.$ 7.8 million);
- Expansion of the range of branded end-user products offered by the Company,
including necessary working capital requirements in this respect - up
to approximately PLN 15.4 million (approximately U.S.$ 5.5 million). In recent
years, the Group introduced A- Brand notebooks (such as Toshiba) to its
distribution network out of which it expects large amounts of sales and more
need for working capital;
- Completion of a purchase of a building in Slovakia, serving as a headquarters
of a local subsidiary - up to approximately PLN 2.0 million (approximately
U.S.$ 0.7 million,). The property (Tuchovske Pole) is situated in
the Bratislava Vajnory area, close to the International Airport of Bratislava.
The area of 9,128 sq.m will be used for building offices and a warehouse which
will substitute for the Company's current facilities.
The Company is planning to use net proceeds of the subscription for the New
Shares for the purposes specified above within 12 months from the Closing Date.
Pending application of any excess funds the Company will invest them in
short-term, investment-grade and interest bearing or zero-coupon securities or
bank deposits.
In order to optimize benefits from the money raised, the Company intends to
start using the net proceeds from the sale of new shares for the purposes listed
above immediately after the Offering is completed.
SHAREHOLDING STRUCTURE BEFORE AND AFTER THE OFFER
Current major shareholders of the Company are KS Holdings, (53.49%), and
financial investors - MAIZURI Enterprises Ltd. (10%), and Alpha Ventures
(6.67%). The remaining shares are mainly owned by the Company's management and
employees. After the offer, the free float of the Company is expected to be
38.2%.
TIMETABLE OF THE OFFER
October 10 - 18 2007 Book-building Period (until 18.00 Warsaw time)
October 10-18, 2007 Subscription for retail investors (until 17.00
Warsaw time)
No later than October 19, Allotment and Pricing Date
2007
October 24, 2007 Settlement and Payment Date
around October 30, 2006 Planned Listing Date
FINANCIAL PERFORMANCE OF ASBIS
After first six months of 2007 Group's revenues increased to USD 540 million,
from USD 426 million in the same period of previous year (26.7% increase). Net
profit increased to USD 3.2 million from USD 2.5 million (27.4% increase).
In 2006, revenues posted by the Group rose to USD 1,009 million, from USD 930
million (up 8.4% YoY) and USD 756 million (up 23.1% YoY) in 2005 and 2004,
respectively. In the same period, net profit generated by the Group (after tax
and before minorities and listing expenses write-off) was also on the rise and
in 2006 reached USD 11.1 million, relative to net profit of USD 8.4 million in
2005 and USD 2.2 million in 2004, the figures representing the increase of 32.1%
and 272.5%, respectively. The table below presents key financial date of ASBIS
Group in the first half of 2007, and years 2006, 2005, 2006.
(in thousand) 1H 2007 1H 2006 2006 2005 2004
USD) Not audited data Not audited data Audited data Audited data Audited data
Sales revenue 540055 426368 1008 930389 755719
Operating profit 5644 4431 16083 12290 5119
Net profit 3168 2486 11070 8378 2249
For additional information please contact:
Magda Koodziejczyk, M+G
Ph: (22) 625 71 40, 0501 16 88 07
e-mail: magda.kolodziejczyk@mplusg.com.pl
Costas Tziamalis, ASBISc Enterprises Plc.
ph : 00357 25 857000
e-mail : costas@asbis.com
David Newton, Seymour Pierce Ltd
Tel : 0044 20 7107 8336
e-mail: davidnewton@seymourpierce.com
For more information, visit also the company's website at www.asbis.com
ASBIS is one of the leading distributors of IT products in Central and Eastern
Europe, the Baltic States, the former Soviet Union, the Middle East and North
Africa. The Company is incorporated in Cyprus and its shares are already listed
on the AIM market in London.
The ASBIS Group combines broad geographical reach with a wide range of products
distributed on a "one-stop-shop" basis. Additionally, the Company distributes
its private labels, Canyon and Prestigio. As at December 31st 2006, ASBIS
provided its services to over 14 thousand customers in approximately 70
countries.
Group is a strong and reliable partner for leading international suppliers of IT
components, including Intel, AMD, Seagate, Samsung, Microsoft, Hitachi and
Toshiba.
The revenues of ASBIS in the H1 2007 amounted to USD 540m, which represented
26.7% growth in comparison to H1 2006. The company recorded USD 3.2m of net
profit, 27.4% increase in comparison to the same period in 2006.
In 2006 ASBIS' revenues exceeded USD 1.0bn, whilst net profit was USD 11.1m.
The major shareholders of the Company are KS Holdings, (53.49%), and financial
investors - MAIZURI Enterprises Ltd. (10%), and Alpha Ventures (6.67%). The
remaining shares are mainly owned by the Company's management and employees.
All capitalized terms used and not otherwise defined herein shall have the
meanings assigned to them in the Prospectus of ASBIS approved by the Financial
Supervision Authority.
This material is of a promotional nature only. The only legally binding document
containing information on ASBISc Enterprises Plc (the "Company") and on the
public offering of shares in the Company is the Prospectus. The Prospectus is
available on the websites of: Gieda Papierow Wartociowych w Warszawie
(www.gpw.pl), the Issuer (www.asbis.com) and ING Securities S.A.
(www.ingsecurities.pl), hardcopies of the Prospectus are available at Customer
Service Desks of ING Securities S.A., Order Placement Points operated by DM
Polonia Net S.A. and BM Nordea Bank, Customer Service Desks of DM BZWBK and
Order Placement Points of Biuro Maklerskie Banku BPH S.A.
These materials are not an offer of securities for sale in the United States.
The securities may not be offered or sold in the United States absent
registration or an exemption from registration under the U.S. Securities Act of
1933, as amended.
This communication is directed only at persons who (i) are outside the United
Kingdom or (ii) are investment professionals falling within Article 19(5) of
the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005
(the "Order") or (iii) are high net worth entities falling within Article
49(2)(a) to (d) of the Order or (iv) such other persons to whom it may lawfully
be communicated (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 statements contained in this announcement which are not historical facts are
forward-looking statements which express the beliefs, opinions and expectations
of the Company and are subject to various risks and uncertainties that could
cause actual results to differ materially from such expectations. The factors
that could affect the Company's future financial results are discussed more
fully in the Company's prospectus in relation to its offer of shares. The
Company assumes no obligation to update information in this announcement.
--------------------------
(1) at the exchange rate of PLN 2.7989 for U.S. $1, as published by the National
Bank of Poland on 29 June 2007
This information is provided by RNS
The company news service from the London Stock Exchange
END
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