Announces intention to refinance bonds using bank debt in Q1
Acquires Borö Pannan
ABSeafire announced today that it is acquiring Borö Pannan AB for SEK 110m (+30m in earn-outs), with 105m paid in cash and 5m in Seafire shares. Borö is an industrial company with a broad offering focusing on heating products. Over the twelve-month period ending 30/09/2022, Borö Pannan had revenues of SEK 136m and EBITDA of SEK 17m, corresponding to an EBITDA margin of 12.5%. This means the acquisition was made at an EV/EBITDA multiple of 6.5x excluding earn-outs, or 8.2x including earn-outs. The acquisition will add ~13% to '23e sales and ~10% to '23e EBITDA.
Directed share issue and refinancing
Seafire also announced this morning that it has successfully performed a directed share issue of SEK 250m at SEK 19 per share to be able to both finance the Borö Pannan acquisition, as well as refinance Seafire's SEK 600m in bonds using cash and SEK 350m of bank debt in Q1. As the company already had SEK 240m in cash, these transactions combined would leave it with SEK 130m in cash. Participants in the share issue include Creades, Handelsbanken Fonder, Danske Invest Småbolag, Andra AP-fonden, Swedbank Robur and RoosGruppen. The share issue dilutes current shareholders by 31%. In conjunction with the share issue press release, Seafire also announced its intention to move from Nasdaq First North Growth Market to Nasdaq Stockholm.
A good step for Seafire
We have previously highlighted the positive effect refinancing the company's bonds using bank debt could have on the company as its bottom line has suffered from the high bond interest (ca. 10%, i.e. SEK 60m a year). We do not yet know the interest rate on the intended bank debt, but even assuming a high 7% interest rate, this would add ~SEK 35m a year to EBT going forward. Our '23e EBT was SEK 62m before th... Läs mer på ABG Sundal Collier
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