AS Tallinna Vesi
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Offering Circular AS Tallinna Vesi (incorporated with limited liability in the Republic of Estonia, commercial register number 10257326) International Offering of 5,454,546 Ordinary Shares (subject to an Over-allotment Option of up to an additional 545,454 Ordinary Shares) 5,454,546 ordinary A-shares of par value EEK10 each (the ‘‘Offer Shares’’) of AS Tallinna Vesi (the ‘‘Company’’), a public limited company organised under the laws of the Republic of Estonia (‘‘Estonia’’), are being offered by United Utilities (Tallinn) B.V., a limited liability company incorporated under the laws of the Netherlands, and the City of Tallinn (Tallinna linn) (together, the ‘‘Selling Shareholders’’) in an international offering (the ‘‘Offering’’). The Offering is comprised of an offering of (i) 4,254,546 Offer Shares to institutional investors outside the United States, including to institutional investors in Estonia (the ‘‘Institutional Offering’’), and (ii) 1,200,000 Offer Shares to the public in Estonia by way of a public offering in Estonia only (the ‘‘Estonian Public Offering’’), in each case in reliance on Regulation S (‘‘Regulation S’’) under the U.S. Securities Act of 1933 (the ‘‘Securities Act’’). The number of Offer Shares being offered in the Institutional Offering may be increased pursuant to exercise of the Over-allotment Option referred to below. The joint global co-ordinators and joint bookrunners of the Institutional Offering are CA IB Corporate Finance Beratungs Ges.m.b.H., AS Lo˜ hmus, Haavel & Viisemann and AS Hansapank (together, the ‘‘Joint Global Co-ordinators’’ or the ‘‘Managers’’). Carnegie Investment Bank AB is acting as co-lead manager of the Institutional Offering. AS Hansapank and AS Lo˜ hmus, Haavel & Viisemann are the joint lead managers of the Estonian Public Offering. Prior to the Offering, there has been no public market for the Company’s ordinary A-shares (the ‘‘Shares’’ or the ‘‘A-Shares’’). Application has been made to list all of the 20,000,000 outstanding Shares on the Tallinn Stock Exchange under the symbol ‘‘TVE’’ and it is expected that such listing will become effective on or about 1 June 2005. The offering price per Offer Share (the ‘‘Offer Price’’) in the Institutional Offering is A9.25. The Offer Price in the Estonian Public Offering is EEK144.73105. See ‘‘Risk Factors’’ beginning on page 12 to read about factors that should be considered before buying the Offer Shares. Offer Price: C9.25 or EEK144.73105 per Offer Share The Selling Shareholders have granted to the Joint Global Co-ordinators an option (the ‘‘Over-allotment Option’’), exercisable for 30 days from the Closing Date (as defined below), to purchase up to 545,454 additional Shares at the Offer Price, less commissions, to cover over-allotments, if any, in connection with the Institutional Offering. Delivery of the Offer Shares in the Institutional Offering is expected to take place in book-entry form against payment therefor in immediately available funds on or about 31 May 2005 (the ‘‘Closing Date’’). The Offer Shares have been registered with the Estonian Central Register of Securities (the ‘‘ECRS’’) in accordance with Estonian law. THE OFFER SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF ANY OTHER STATE OR JURISDICTION (SAVE FOR ESTONIA). SUBJECT TO CERTAIN EXCEPTIONS, THE OFFER SHARES MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES. THIS OFFERING CIRCULAR IS INTENDED FOR USE ONLY IN CONNECTION WITH OFFERS OUTSIDE THE UNITED STATES AND IS NOT TO BE SENT OR GIVEN TO ANY PERSON WITHIN THE UNITED STATES. SEE ‘‘SUBSCRIPTION AND SALE’’. Joint Global Co-ordinators and Joint Bookrunners Co-Lead Manager 27 May 2005 Each of the Company, United Utilities (Tallinn) B.V. (‘‘UUTBV’’) and the City of Tallinn hereby accepts responsibility for the accuracy and completeness of all the information contained in this Offering Circular. Each of the Company, UUTBV and the City of Tallinn also hereby confirms that it has taken all appropriate measures to check the accuracy and completeness of the information given in this Offering Circular, and that the information supplied contains no omissions likely to affect the content or meaning of this Offering Circular, and hereby also confirms that the Shares in respect of which this Offering Circular has been prepared, and the Company, each complies with the requirements of applicable Estonian legislation. The Managers make no representation or warranty, expressed or implied, as to the accuracy or completeness of the information in this Offering Circular, and nothing in this Offering Circular is, or shall be relied upon as, a promise or representation by the Managers. No person is or has been authorised to give any information or to make any representation in connection with the Institutional Offering or the sale of the Offer Shares, other than as contained in this Offering Circular, and, if given or made, any other information or representation must not be relied upon as having been authorised by the Company, the Selling Shareholders or the Managers. The delivery of this Offering Circular at any time after the date hereof shall not, under any circumstances, create any implication that there has been no change in the affairs of the Company since the date hereof or that the information set forth in this Offering Circular is correct as at any time since its date. In connection with the Estonian Public Offering, a prospectus has been prepared in the Estonian language (the ‘‘Estonian Prospectus’’). The Estonian Prospectus has been approved by the Tallinn Stock Exchange, in accordance with the provisions of the Estonian Securities Market Act (Va¨a¨rtpaberituru seadus), legislation established on the basis thereof, and the Rules of the Tallinn Stock Exchange (the ‘‘TSE Rules’’). Approval by the Tallinn Stock Exchange does not imply that the Tallinn Stock Exchange represents that the factual information provided in the Estonian Prospectus is correct or complete. This Offering Circular does not constitute an offer of, or an invitation by or on behalf of the Company, the Selling Shareholders or the Managers to subscribe or purchase, any of the Offer Shares. The distribution of this Offering Circular and the offering of the Offer Shares in certain jurisdictions may be restricted by law. Persons into whose possession this Offering Circular comes are required by the Company, the Selling Shareholders and the Managers to inform themselves about and to observe any such restrictions. This Offering Circular may not be used for, or in connection with, and does not constitute, any offer to sell, or an invitation to purchase, any of the Offer Shares in any jurisdiction in which such offer or invitation would be unlawful. For a description of certain further restrictions on offers and sales of Offer Shares and distribution of this Offering Circular, see ‘‘Subscription and Sale’’ below. This Offering Circular is for the intended recipients only and may not in any way be directed to the public in Estonia. Accordingly, each Manager has represented, warranted and agreed that it has not offered or sold and will not offer or sell any of the Offer Shares in the Institutional Offering in Estonia in a manner that would constitute a public offering and/or that would require the approval of a prospectus by the Tallinn Stock Exchange and/or registration of a prospectus with the Estonian Financial Supervision Authority (the ‘‘EFSA’’). This Offering Circular may not be distributed to, or in, any other country where such distribution (i) requires additional registration or measures other than those prescribed by Estonian law or (ii) conflicts with applicable legislation or regulation in such country. The Listing and Surveillance Committee of the Tallinn Stock Exchange approved the Estonian Prospectus and granted its conditional decision for listing of the Shares on 13 May 2005. A description of the conditions which must be met for the listing decision to enter into effect is set out under ‘‘Subscription and Sale — The Offering — The Institutional Offering and the Estonian Public Offering’’. This Offering Circular has been produced for the purpose of considering the purchase of the Offer Shares in the Institutional Offering. In making an investment decision regarding the Offer Shares, investors must rely on their own examination of the Company and the terms of the Offering, including, without limitation, the merits and risks involved. The Institutional Offering is being made solely on the basis of this Offering Circular. In connection with the Institutional Offering, AS Hansapank or any agent of it may over-allot or effect transactions that stabilise or maintain the market price of the Shares at levels above those which might otherwise prevail in the open market. Such transactions may be effected on the Tallinn Stock Exchange, in the over-the-counter market or otherwise. There is no assurance that such stabilisation will be undertaken and, if it is, it may be discontinued at any time. 2 TABLE OF CONTENTS PRESENTATION OF FINANCIAL AND OTHER INFORMATION ............................................. 4 FORWARD-LOOKING STATEMENTS ................................................................................................. 5 AVAILABLE INFORMATION ................................................................................................................. 5 SUMMARY....................................................................................................................................................