Completion of the acquisition of Hansa Borg Bryggerier

CORPORATE ANNOUNCEMENT N° 28/2022 – MAY 25, 2022

Further to the company’s announcement, no. 24/2022, published on May 13, 2022, we are pleased to announce that the acquisition of the remaining 75% of Hansa Borg Bryggerier (HBH) is now complete.

As previously announced, Royal Unibrew has agreed to acquire the remaining 75% of Hansa Borg Bryggerier, of which Royal Unibrew already held 25% ownership, resulting in 100% ownership of the company. Hansa Borg Bryggerier is Norway’s second largest brewery and beverage company with four breweries and a bottling plant throughout the country and products ranging from beers to ciders, soft drinks, waters and wines for the Norwegian market.

Together with Solera Beverage Group, which Royal Unibrew acquired in September 2021, the acquisition of the remaining 75% of Hansa Borg Bryggerier will create a strong multi-beverage market position for Royal Unibrew in Norway.

Royal Unibrew CEO Lars Jensen said: “I am very pleased to announce that we have now finalized the agreement, and we look forward to welcoming our new colleagues to Royal Unibrew and beginning the long-awaited journey to create the leading multi-drink supplier in Norway. We will now begin the integration, and together we will grow the business and bring even more products and value to our customers, consumers and partners.”

DETAILS OF THE TRANSACTION AND FINANCIAL IMPLICATIONS OF THE ACQUISITION

The final enterprise value for accounting purposes will be determined at the closing of the transaction, as the value of the consideration will depend on the Royal Unibrew share price on the closing date. With the current share price (580), the entry value for 100% of the company is NOK 2.6 billion (DKK 1.9 billion).

The transaction will result in a revaluation of the 25% stake that Royal Unibrew holds in Hansa Borg Bryggerierne at closing and will lead to an extraordinary pre-tax profit in 2022 of approximately DKK 0.4 billion recognized in financial result below the EBIT.

Hansa Borg Bryggerier is expected to generate in 2022 a normalized turnover of approximately NOK 1.4 billion with a normalized EBITDA of approximately NOK 210 million, which will result in an acquisition multiple (EV/EBITDA) of 12.4 times at the close. Return on investment from Royal Unibrew’s Norwegian operations is expected to exceed WACC within 2 years of closing.

According to the agreement, 10% of the payment, corresponding to NOK 231 million (DKK 171 million), will be paid in cash, while the remaining 90% of the payment will be paid in Royal Unibrew shares. It has been agreed that the payment in shares will consist of 2,194,257 shares, which will be a mixture of 794,257 own shares and 1,400,000 new shares (issued at the price fixed at the signing of 759 DKK per share with a nominal value of 2 DKK, see company announcement no. 01/2022). The capital increase has been approved by the Board of Directors in accordance with the authorization of section 2a7 of the articles of association of Royal Unibrew A/S.

The capital increase corresponds to 2.87% of the share capital of Royal Unibrew A/S. After the capital increase, the share capital of Royal Unibrew A/S amounts to DKK 100,400,000 nominal value divided into 50,200,000 shares with a nominal value of DKK 2 per share, and each share carries one vote. , i.e. the total number of voting rights is 50,200,000.

The capital increase is being carried out without pre-emption rights for existing shareholders of Royal Unibrew A/S and will give new shareholders shareholder rights from the time of registration. The share capital increase is expected to be registered shortly with the Danish Business Authority. The new shares are expected to be admitted to trading and official listing on Nasdaq Copenhagen with May 31, 2022 as the first day of trading.

The transaction and share issue ensures that Royal Unibrew’s capital structure remains strong and with financial flexibility.

FINANCIAL OUTLOOK FOR 2022

We are adjusting our outlook for 2022 due to the full ownership of Hansa Borg Bryggerier. We now expect revenues in the range of DKK 10,700-11,700 million (previously: DKK 10,000-11,000 million) and EBIT in the range of DKK 1,700-1,850 million (previously: 1 650 to 1,800 million DKK).

The higher revenue outlook is the result of further price increases and a contribution of around seven months from Hansa Borg Bryggerier. We expect Hansa Borg Bryggerier to contribute approximately DKK 50 million to EBIT for the remaining seven months of the year, including integration and restructuring costs. The additional price increases, which will be implemented across the group over the next few months, come with an expected profit contribution and as a result we are increasing the EBIT outlook range by 50 million from DKK.

For more information on this announcement:
Investor and media relations: Jonas Guldborg Hansen, tel (+45) 20 10 12 45

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