Due diligence completed for the integration of Thrane & Thrane A/S and Nera ASA satellite
activities and revised forecast for the current financial yearOn Monday, August 20, 2001 Thrane & Thrane A/S announced
that it had signed an agreement with Nera ASA to acquire the shares in Nera’s wholly-owned subsidiaries Nera SatCom AS
and Nera WBA Satellite AS.
Since that announcement, Thrane & Thrane and Nera have worked on completing the integration of the two companies’ satellite activities. The companies’ efforts focused on conducting the due diligence process, which has now been completed to the satisfaction of both parties.After completing the due diligence process, the parties have agreed to change the contents of the agreement, and Thrane & Thrane and Nera therefore signed an agreement. Thrane & Thrane will acquire Nera SatCom, comprising all Nera’s mobile satellite activities, effective October 1, 2001. The acquisition also includes Nera SatCom’s wholly-owned subsidiaries Nera GmbH of Germany and Nera HK Ltd. of Hong Kong, and Nera SatCom’s shares in the associated companies Neratek AS of Norway (45% ownership) and Beijing Nera Stentofon Communications Ltd. (36% ownership).
As consideration, Thrane & Thrane will pay DKK 285.0 million in cash and issue a subordinate convertible bond in the nominal amount of DKK 215.7 million. The subordinate bond has a maturity of five years and carries interest at an annual rate of 4% for the first three years and 9% thereafter. Thrane & Thrane may redeem the bond after three years. During the term of the bond, Nera is entitled to convert the bond into 2,157,000 shares, equal to an ownership interest of 32.0% following a capital increase. Nera and Thrane & Thrane will set up a new joint company, Broadband AS, which will include Nera’s satellite-based broadband activities. The new company will on January 1, 2002 have a capital base of NOK 45.0 million. Nera will contribute NOK 30.0 million and Thrane & Thrane will contribute NOK 15.0 million, giving Nera 67% ownership and Thrane & Thrane 33%. Nera and Thrane & Thrane will enter into a shareholders’ agreement in respect of Broadband, which will govern the ownership structure. It is intended that Nera and Thrane & Thrane will each appoint two members to the Board of Directors of Broadband. Nera will be entitled to appoint the Chairman of the Board, who will have a casting vote. Thrane & Thrane’s Board of Directors has approved the transaction, which means that it now depends on a statement from Nera’s corporate committee, approval by Nera’s corporate assembly, approval by the shareholders at an extraordinary general meeting of Thrane & Thrane, and approval by the relevant national authorities.