Scandinavian Biogas explores conditions to carry out a Directed Share Issue
The Directed Share Issue is conditional upon Scandinavian Biogas' board of directors resolving to issue new shares and that the board resolution is approved by a subsequent Extraordinary General Meeting.
The Directed Share Issue is intended to be directed to Swedish and international institutional investors. Scandinavian Biogas has appointed ABG Sundal Collier as Sole Global Coordinator and Sole Bookrunner to explore the conditions to carry out the Directed Share Issue through an accelerated bookbuilding procedure.
TrønderEnergi Vekst Holding, Bengtssons Tidnings and other existing shareholders, including CEO Matti Vikkula, have expressed their intention to subscribe for SEK 300 million, SEK 17 million and SEK 4 million respectively, at a subscription price of SEK 25 per share.
If the board of directors decides on the Directed Share Issue, the company will publish a separate notice to an Extraordinary General Meeting, which is expected to be held on 27 October 2022.
Existing shareholders, who together hold approximately 31% of the shares in Scandinavian Biogas have undertaken to vote in favour of the Directed Share Issue in the Extraordinary General Meeting. The subscription price and total number of shares to be issued will be determined through an accelerated bookbuilding procedure which will commence immediately.
Pricing and allocation in the accelerated bookbuilding procedure is expected to take place before the commencement of trading on Nasdaq First North Premier Growth Market on 6 October 2022.
The completion, pricing and allocation in the bookbuilding procedure are at the discretion of the company and may be shortened or extended and may at any time be cancelled by the board of directors. The company will announce the outcome after the accelerated bookbuilding procedure has been completed.
The demand for green energy remains very high and the market prices for biogas are at a significantly higher level compared to last year. Scandinavian Biogas expects the price levels in new delivery agreements to the Scandinavian market to be approximately SEK 1,400-1,800 per MWh including production support. This is a significant increase compared to the average price during the first half of 2022, which was approximately SEK 900 per MWh.
The price level for the volumes delivered to the northern European market is significantly higher. This was also reflected in the recently signed agreement with the German distributor Alternoil where the average price is estimated at SEK 2,700 per MWh, which includes Bio-LNG and compensation for GHG certificates.
All price estimates above are based on the market prices prevailing in June 2022.
In accordance with Scandinavian Biogas' financial targets for 2024, the company expects that 70% of the Swedish operation's production volume and 40% of the Norwegian operation's production volume will be sold with a geographic mix that gives a higher average market price than current sales.
The orderbook amounted to 2.3 TWh as of the end of June 2022. About 70% of the contracts have a duration of at least 4 years, which is in good balance with the intake corresponding to an energy value of 2.1 TWh, where over 75% of the contracts runs for at least 4 years.