NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN OR ANY OTHER JU-RISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL.
The Executive Board of Deutsche Lufthansa AG today, with the approval of the Company's Supervisory Board, resolved to utilize the Authorized Capital C for a capital increase with subscription rights of the Company’s shareholders. The Company's share capital of currently EUR 1,530,221,624.32, divided into 597,742,822 shares, will be increased by issuing 597,742,822 new no-par value shares of the Company.
The gross proceeds are expected to amount to EUR 2,140 million. The subscription price of EUR 3.58 per New Share corresponds to a discount of 39.3% on the TERP (theoretical ex-rights price). The subscription ratio is 1:1. The new shares are to be offered to the Company’s shareholders during the subscription period, which is expected to commence on September 22, 2021 and end on October 5, 2021. The rights trading is expected to commence on September 22, 2021 and end on September 30, 2021.
The transaction is fully underwritten by a syndicate of 14 banks. In addition, a number of funds and accounts under the management of BlackRock, Inc. have entered into a sub-underwriting agreement for a total of EUR 300 million and have committed to fully exercise their subscription rights. All members of the Executive Board of the Company have also committed to participate in the capital increase and to exercise all subscription rights received in relation to their shares in full.
The capital increase is meant to strengthen the Group’s equity position. The Company will use the net proceeds to repay the Silent Participation I of the Economic Stabilization Fund of the Federal Republic of Germany (ESF) in the amount of EUR 1.5 billion. Additionally, the Company intends to fully repay the Silent Participation II in the amount of EUR 1 billion by the end of 2021 and also intends to cancel the undrawn amounts of the Silent Participation I by the end of 2021.
The ESF, which currently holds 15.94% of the Company's share capital, has undertaken to start divesting its equity interest in the Company no earlier than six months after completion of the capital increase, if the ESF subscribes to the capital increase. In this event, the divestment shall be completed no later than 24 months after the closing of the capital increase, provided that the Company repays the Silent Participation I and the Silent Participation II as intended.
The public offer of the New Shares in Germany is made exclusively through and on the basis of a securities prospectus approved by the German Federal Financial Supervisory Authority (BaFin), which will be made available, among other, on the website of the Lufthansa Group (https://www.lufthansagroup.com/capital-increase). The approval is expected to be granted on September 20, 2021. There will be no public offering outside Germany and the prospectus will not otherwise be approved by any other regulatory body.
This announcement may not be, directly or indirectly, published, distributed or transmitted in or into the United States, Canada, Australia or Japan or any other jurisdiction in which the distribution or release would be unlawful. This announcement does not contain or constitute an offer of, or the solicitation of an offer to buy or subscribe for, securities, to any person in the United States, Australia, Canada, Japan or in any jurisdiction to whom or in which such offer or solicitation is unlawful.
This release is not an offer of securities for sale in the United States of America. Securities may not be offered or sold in the United States of America absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended (the “Securities Act”). There will be no public offer of the securities in the United States of America.
Subject to certain exceptions, the securities referred to herein may not be offered or sold in the United States, Australia, Canada or Japan or to, or for the account or benefit of, any national, resident or citizen of the United States, Australia, Canada or Japan.
This announcement does not constitute an offer to sell nor a solicitation to buy any securities. Any offer is made exclusively by means of and on the basis of a prospectus to be published in Germany, supplemented by additional information relating to the offer outside Germany. The prospectus will be available free of charge from Deutsche Lufthansa Aktiengesellschaft, Venloer Straße 151-153, 50672 Cologne, Germany, or on the website Deutsche Lufthansa Aktiengesellschaft at https://www.lufthansagroup.com/capital-increase.
In the United Kingdom, this announcement is only being distributed to and is only directed at persons who (i) are qualified investors as defined in Regulation (EU) 2017/1129 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018, (ii) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”), or (iii) are persons falling within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations, etc.) (all such persons together being referred to as “Relevant Persons”). This announcement is directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this announcement relates is available only to Relevant Persons and will be engaged in only with Relevant Persons.
This announcement contains certain “forward-looking statements.” Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words as “will,” “anticipates,” “aims,” “could,” “may,” “should,” “expects,” “believes,” “intends,” “plans,” “prepares” or “targets” (including in their negative form or other variations). By their nature, forward-looking statements are inherently predictive, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that may or may not occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. All subsequent written or oral forward-looking statements attributable to the Company or any persons acting on their behalf are expressly qualified in their entirety by the factors referred to above. No assurances can be given that the forward-looking statements in this announcement will be realized. Any forward-looking statements are made of the date of this announcement. The Company does not assume any obligations to update any forward-looking statements. Moreover, it should be noted that all forward looking statements only speak as of the date of this release and that neither the Company nor the underwriters (the “Underwriters”) assume any obligation, except as required by law, to update any forward looking statement or to conform any such statement to actual events or developments.
Each of the Company and the Underwriters and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any forward-looking statement contained in this release, whether as a result of new information, future developments or otherwise.
Each of the Underwriters is acting exclusively for the Company and no-one else in connection with the potential capital increase. They will not regard any other person as their respective clients in relation to the potential capital increase and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, nor for providing advice in relation to the potential capital increase, the contents of this announcement or any transaction, arrangement or other matter referred to herein.
In connection with the sale of the shares, the Underwriters and any of their affiliates may take up a portion of the securities in the offering as a principal position and in that capacity may retain, purchase, sell, offer to sell for their own accounts such shares and other securities of the Company or related investments in connection with the sale or otherwise. Accordingly, references in this announcement to the shares being sold, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, any of the Underwriters and any of their affiliates acting in such capacity. In addition, any of the Underwriters and any of their affiliates may enter into financing arrangements (including swaps or contracts for differences) with investors in connection with which the Underwriters and any of their affiliates may from time to time acquire, hold or dispose of securities of the Company. The Underwriters do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.
None of the Underwriters or any of their respective directors, officers, employees, advisers or agents accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith.
This announcement also contains certain financial measures that are not recognized under International Financial Reporting Standards (“IFRS”). These non-IFRS measures are presented because the Company believes that they and similar measures are widely used in the markets in which it operates as a means of evaluating a company's operating performance and financing structure. They may not be comparable to other similarly titled measures of other companies and are not measurements under IFRS or other generally accepted accounting principles.
This announcement does not purport to contain all information required to evaluate Deutsche Lufthansa Aktiengesellschaft and/or its respective financial position. Financial information (including percentages) has been rounded according to established commercial standards. Certain market data about Deutsche Lufthansa Aktiengesellschaft included in this announcement is sourced from third party sources. Third party industry publications, studies and surveys generally state that the data contained therein have been obtained from sources believed to be reliable, but that there is no guarantee of the fairness, quality, accuracy, relevance, completeness or sufficiency of such data. Such research and estimates, and their underlying methodology and assumptions, have not been verified by any independent source for accuracy or completeness and are subject to change without notice. Accordingly, Deutsche Lufthansa Aktiengesellschaft expressly disclaims any responsibility for, or liability in respect of, such information and undue reliance should not be placed on such data.