Ballast Nedam Reaches Agreement on Strengthening Equity and New Financing

NIEUWEGEIN, The Netherlands, April 29, 2015 /PRNewswire/ --

Ballast Nedam presents a package of measures with a view to dealing with the heavy project losses of the Infrastructure division. The package was drawn up with the cooperation of the banking syndicate consisting of ING Bank, Rabobank and the Royal Bank of Scotland and the joint-venture partners Strukton Groep N.V. and Strabag SE (projects A2 Maastricht en A15 Maasvlakte-Vaanplein). Implementation of these measures will also lead to a substantial improvement of the company's solvency and liquidity. 

The package sets out the following financial and strategic measures: 

• An outline agreement about financing and rights issue 
• Strukton and the banking syndicate each grant a €10 million bridge loan, both to be repaid from the net proceeds of a €20 million rights issue, which will be underwritten by Strukton and the banking syndicate 
• Ballast Nedam will actively scale back its interests in large-scale infrastructure projects 
• A15 Maasvlakte-Vaanplein project: economic share reduced from 40 per cent to 10 per cent; Strukton and Strabag increase their share to 45 per cent each 
• A2 Maastricht project: transfer of infrastructure part to Strukton; transfer of property development to Ballast Nedam 
• Annual results 2014 will be published on Thursday 30 April 2015, after trading hours 

The financing consists of: 

• two bridge loans granted by Strukton and the banking syndicate totalling €20 million until completion of the rights issue in the second half of 2015;
• a subordinated bank loan of €10 million expiring on 31 March 2017;
• a subordinated bank loan of €43 million expiring on 31 March 2017;
• a revolving credit facility of €10 million expiring on 31 December 2015; and
• a committed guarantee facility of initially €265 million, which will be phased out based on scaling back of the large infrastructure projects, including the A2 Maastricht and the A15 Maasvlakte-Vaanplein projects.

These intended transactions will be developed into final agreements in the coming period.

Rights issue of €20 million in the second half of 2015 

Ballast Nedam has reached agreement on the main outline of a rights issue, offering tradable rights to existing holders of depositary receipts for shares to register for depositary receipts for shares, totalling €20 million. Upon agreement, Strukton will guarantee the rights issue for €10 million and it will issue a bridge loan for that amount. This bridge loan will be repaid from the net proceeds of the proposed rights issue. The remaining €10 million of the rights issue will be guaranteed by the banking syndicate, which is comprised of the ING Bank, Rabobank, and the Royal Bank of Scotland. A bridge loan will also be issued for this purpose, to be repaid from the proceeds of the rights issue.

The rights issue must be accompanied by a prospectus approved by the Netherlands Authority for the Financial Markets (AFM). This rights issue and an amendment to the Articles of Association reducing the nominal value of the shares to €0.01 will be submitted to the General Meeting of Shareholders for approval. Reduction of the nominal value from €1.00 to €0.01 is necessary to achieve maximum flexibility for a successful rights issue. Ballast Nedam intends to complete the rights issue in the second half of 2015.

Ballast Nedam will scale back its interests in large-scale infrastructure projects 

Ballast Nedam will actively scale back its interests in large-scale infrastructure projects, as currently announced with letters of intent for the A15 Maasvlakte-Vaanplein and A2 Maastricht projects. This reduces the risk profile of Ballast Nedam even further. The Infrastructure division will focus exclusively on smaller, integrated infrastructure projects in concrete construction, road-building, civil engineering, and industrial construction. Tendering will be done on a highly selective and targeted basis for both Dutch and international projects, whereby close attention will be paid, in particular, to the risk profile in relation to the margin. As a result, the extent of the infrastructure activities will become smaller, necessitating an adjustment in capacity for the Infrastructure division.

A15 Maasvlakte-Vaanplein project: economic share reduced from 40 per cent to 10 per cent 

A letter of intent has been signed with Strukton and Strabag, partners in the A15 Maasvlakte-Vaanplein project, by which Ballast Nedam will reduce its economic stake in the project from 40 per cent to 10 per cent. Strabag and Strukton will increase their share to 45 per cent each. This change will be effective from the second half of 2015. The legal participation remains unchanged: the three parties each hold a 33.33 per cent share in the joint venture A-Lanes A15.

A2 Maastricht project: transfer of infrastructure part to Strukton; transfer of property development to Ballast Nedam 

A letter of intent has been signed with Strukton, our parter in the A2 Maastricht project, for the takeover of Ballast Nedam's share in the infrastructure activities in the project. Strukton's share in the property development of the A2 Maastricht project will be transferred to Ballast Nedam.

Both proposed transactions will be developed during the coming period into final agreements which will be submitted to the stakeholders for permission. The Directorate-General for Public Works and Water Management (Rijkswaterstaat) has expressed its willingness to provide cooperation.

Annual results 2014 will be published on Thursday 30 April 2015 

Ballast Nedam will publish its annual results and the Annual report on Thursday 30 April 2015, after closing of the stock exchange. The package of measures and the annual results will be explained further in a press conference on Friday 1 May at 10:00 a.m. in Ballast Nedam's head office in Nieuwegein.

Ballast Nedam targets its strategic focus at successfully acquiring and carrying out integrated projects in the working areas of housing and mobility in the Netherlands and internationally. We also work on projects where we can make a difference for the client with our expert knowledge and skills. Ballast Nedam applies a differentiated market approach for its three divisions.

With further industrialization of the building process through the use of innovative modular concepts and standardization Ballast Nedam creates enduring quality at the lowest possible life cycle costs for its clients and society. The Ballast Nedam share is included in the Amsterdam Small Cap Index (AScX) of Euronext. http://www.ballast-nedam.com