Company Announcement No. 6-2022
Copenhagen, 3 March 2022
This company announcement constitutes inside information that Penneo is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014.
With reference to company announcements No. 16-2021 of 21 June 2021 and No. 5-2022 of 21 February 2022, Penneo A/S ("Penneo") today announces a private placement and directed offering of new shares (the shares in Penneo referred to as "the Shares"), to a number of reputable institutional investors (the "Private Placement"). As part of the Private Placement, Penneo will issue a total of 4,479,204 new Shares at a subscription price of DKK 13.75 per share, resulting in gross proceeds for Penneo of approx. DKK 60 million. Thus, as result of extraordinary interest from the institutional investors, the Board of Directors has decided to exercise its full authorization to issue new shares, corresponding to approximately 15% of Penneo’s market capitalization and not 5-10% as previously communicated in company announcement No. 5-2022 of 21 February 2022.
Raising growth capital to accelerate the updated strategy
Penneo was admitted to trading on Nasdaq First North Growth Market Denmark on 2 June 2020 and has since the IPO realised strong SaaS metrics and made several key accomplishments:
- Fulfillment of the growth strategy put forth in the IPO document
- Acquisition of CLA Reply’s KYC software
- Realised an ARR growth rate of 50% in 2021 compared to a guided ~40% ARR growth rate in the IPO document
Consequently, and as announced in Company Announcement No. 5-2022, the strategy was reaffirmed and revised, based on the continued core aspirations of continued growth and expansion, through the two-fold go-to-market strategy supported by three investment streams:
- Upsell Penneo KYC product to auditors
- Penetrate AML-governed industries with Penneo’s KYC and Sign product
- Fuel expansion through the Audit and Accounting vertical to become the de facto standard for auditors in Europe
The execution of the updated strategy will be accelerated through additional growth capital, which is expected to be invested in sales, product development and business operations.
The Private Placement
The Private Placement is made pursuant to and in compliance with the applicable exemptions from the obligation to publish a prospectus The Shares have been offered at market price without any pre-emption right for Penneo's existing shareholders.
Penneo has, with certain exceptions, agreed to a 180-day lock-up period on sale of Shares from time of the registration of the capital increase.
Resolution on the capital increase
Subject to settlement, the share capital increase will be registered with the Danish Business Authority and the share capital of Penneo will consist of 31,608,135 shares with a nominal value of DKK 0.02 each.
The new Shares represent approximately 16.5% of Penneo’s registered share capital before the capital increase and 14.2% of Penneo's share capital after the capital increase.
The Board of Directors has accordingly exercised a nominal value of DKK 89,584.08 out of the total authorisation of a nominal value of DKK 89,584.08 in connection with the Private Placement, and the authorisation set out in article 3.1 of the Company’s articles of association pursuant to which the Board of Directors is authorised to increase the share capital without pre-emption right for Penneo’s existing shareholders therefore has been fully exercised.
Admission to trading
Nasdaq Copenhagen A/S has as operator of Nasdaq First North Growth Market Denmark confirmed the timeline for admission for trading of the new Shares under the same ISIN code as the existing shares, DK0061283009, after registration of the capital increase with the Danish Business Authority. The new Shares will be issued in the temporary ISIN code, DK0061681327, which will be merged with the primary ISIN code for existing shares, DK0061283009, as soon as possible after the capital increase has been registered with the Danish Business Authority. The temporary ISIN code, DK0061681327, will not be admitted to trading on Nasdaq First North Growth Market Denmark but will only be registered with Euronext Securities Copenhagen for use in connection with subscription for the new Shares.
Expected timetable for the Private Placement
Existing ISIN: DK0061283009
Temporary ISIN: DK0061681327
Sole global Coordinator
Danske Bank A/S is acting as Sole Global Coordinator and will receive subscription orders in connection with the Offering.
The new shares
The new Shares will rank pari passu with the existing Shares in Penneo. The new Shares will be negotiable instruments, and no restrictions will apply to their transferability. No shares, including the new Shares, carry any special rights. The rights conferred by the new Shares, including voting and dividend rights, will apply from the date when the capital increase is registered with the Danish Business Authority. The new Shares are to be registered in the name of the holder in Penneo's register of shareholders.
About Penneo A/S
Penneo is a Software-as-a-Service (SaaS) provider originally established to help companies with digital document signatures. Penneo was founded by six Danish entrepreneurs, who joined forces with a shared ambition to reduce the “hassle of getting documents signed” by replacing pen and paper with a digital alternative. This new digital “pen” (Pen-neo) was launched in 2014. Today, Penneo has evolved into an eco-system of automation solutions that digitize company workflows in connection with onboarding of customers (KYC) and secure and easy signing and management of documents. The company offers a RegTech solution that gives companies an efficient and inexpensive tool for complying with regulatory requirements. Penneo holds a strong position in the Nordic countries. In Denmark alone, more than 740,000 individuals signed documents electronically with Penneo in 2021.
For information about Penneo, please visit https://penneo.com/investors/
This company announcement contains forward-looking statements. These statements are not guarantees of future performance and involve certain risks and uncertainties, in particular this announcement should not be construed as a confirmation neither that the Offering will complete, nor of the deal size or the price. Therefore, actual future results and trends may differ materially from what is forecast in this report due to a variety of factors.
This announcement is intended for the sole purpose of providing information. Persons needing advice should consult an independent financial adviser. This announcement does not constitute an investment recommendation.
This announcement is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States (including its territories and possessions, any state of the United States and the District of Columbia, the "United States"), Canada, Japan, South Africa, Hong Kong or Australia, except as permitted by applicable law, or any other jurisdiction in which such publication or distribution is unlawful.
This announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States, Canada, Japan, South Africa, Hong Kong, Australia or any other jurisdiction in which such offers or sales are unlawful (the "Excluded Territories"). Any failure to comply with this may constitute a violation of US, Canadian, Japanese, South African, Hong Kong or Australian securities laws or the securities laws of other states as the case may be.
The securities referred to in this announcement have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"), or under the securities laws of any state of the United States, and may not be offered, sold, resold or delivered, directly or indirectly, in or into the United States absent registration except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act. Subject to certain limited exceptions, the securities referred to in this announcement are being offered and sold only outside the United States. The securities offered in connection with the offering have not been and will not be registered under any applicable securities laws of any state, province, territory, county or jurisdiction of the Excluded Territories. Accordingly, such securities may not be offered, sold, resold, taken up, exercised, renounced, transferred, delivered or distributed, directly or indirectly, in or into the Excluded Territories or any other jurisdiction if to do so would constitute a violation of the relevant laws of, or require registration of such securities in, the relevant jurisdiction. There will be no public offer of securities in the United States or elsewhere.
This announcement is not a prospectus and has been prepared on the basis that any offers of securities referred to herein in any member state of the European Economic Area will be made pursuant to an exemption under Regulation (EU) 2017/1129 on prospectuses (the "Prospectus Regulation"). The information set forth in this announcement is only being distributed to, and directed at, persons in member states of the European Economic Area who are qualified investors ("Qualified Investors") within the meaning of the Prospectus Regulation.
This announcement and any offer subsequently made is, and will be, addressed to and directed only at persons, in the United Kingdom, who are (a) both "qualified investors" within the meaning of the UK version of the EU Prospectus Regulation (2017/1129/ EU) which is part of UK law by virtue of the European Union (Withdrawal) Act 2018 and either (i) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (ii) who are high net worth entities falling within Article 49 of the Order; or (b) other persons to whom it may otherwise lawfully be communicated (all such persons under (a) and (b) together being referred to as "Relevant Persons"). Any investment or investment activity to which this document relates is available in the United Kingdom only to Relevant Persons.
This information must not be acted or relied on by, and any investment activity to which this information relates is not available to and may not be engaged with, persons (i) in any member state of the European Economic Area or the United Kingdom who are not Qualified Investors, and (ii) in the United Kingdom who are not Relevant Persons.
No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Penneo A/S or by any of its affiliates or agents, or the Sole Global Coordinator, as to or in relation to, the accuracy, completeness or sufficiency of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers in connection with the company's new Shares and/or the private placement referred to herein, and any liability therefore is expressly disclaimed.
The Sole Global Coordinator and its affiliates are acting exclusively for Penneo A/S and no-one else in connection with the Offering. They will not regard any other person as their respective clients in relation to the Offering and will not be responsible to anyone other than Penneo A/S for providing the protections afforded to their respective clients, nor for providing advice in relation to the Offering, the contents of this announcement or any transaction, arrangement or other matter referred to herein.
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the shares in Penneo A/S have been subject to a product approval process, which has determined that such shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, Distributors should note that: the price of the shares in Penneo A/S may decline and investors could lose all or part of their investment; the shares in Penneo A/S offer no guaranteed income and no capital protection; and an investment in the shares in Penneo A/S is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the contemplated share issue. Furthermore, it is noted that, notwithstanding the Target Market Assessment, Danske Bank A/S will only procure investors who meet the criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the shares in Penneo A/S Each distributor is responsible for undertaking its own target market assessment in respect of the shares in Penneo A/S and determining appropriate distribution channels.