Ementor AB

EME - Plans of share issue of up to MNOK 300

Pressmeddelande   •   Okt 20, 2004 12:00 CEST

Ementor's board of directors decided on 19 October 2004 to initiate a share issue of up to approximately MNOK 300 divided between a Directed Issue and a subsequent Rights Issue. The main purpose of the share Issue is to create a stronger financial platform that will support the need for working capital related to the present and expected growth within Business Solutions and Outsourcing.

The Directed Issue will comprise approximately MNOK 200 and will take place in the period from 20 to 22 October 2004. The subscription price will be decided by the board of directors and subsequently announced to the market after the close of business on 20 October 2004. Minimum subscription amount will be NOK 340,000. Shareholders as of the close of business on 20 October 2004 will have preceding rights based on their percentage ownership of the company.

The subsequent Rights Issue is expected to comprise approximately MNOK 100 at the same subscription price as in the Directed Issue. Shareholders as of the close of business on 20 October 2004, excluding those shareholders who participate in the Directed Issue, will receive tradable subscription rights in the Rights Issue. The subscription period will start as soon as practicable after the Directed Issue and the Rights Issue have been approved by an extraordinary general meeting. The subscription rights will be listed on Oslo Børs in the subscription period. The EME shares will trade exclusive of subscription rights from 21 October 2004.

Both the Directed Issue and the Rights Issue are subject to the approval of Ementor's shareholders. The Board of directors will today call for an extraordinary general meeting to take place on 3 November.

Ementor will in connection with the listing of the shares in the Directed Issue and the Rights Issue publish a prospectus. A draft of this prospectus ("red herring") will be made available on the company's website www.ementor.com after the close of business today.

ABG Sundal Collier and DnB NOR Markets have been engaged as, respectively, lead-manager and co-lead manager for the Directed Issue and the Rights Issue.

Ementor is in a transition phase where the revenue mix is changing according to the strategic direction decided when new Ementor was created in 2003. The overall priorities are to build long term customer relationships by taking responsibility for developing, implementing and operating the customers' business critical software applications and IT infrastructure, focusing on building a recurring revenue platform.

An important indicator which supports the confidence in a continued growth in Ementor's outsourcing revenues is the growth in the outsourcing contract base. The contract base value grew with 40% for the first 9 months ending September 2004, compared with the same period in 2003, measured by annual revenue value. During the last 12 months Ementor has improved its position in the outsourcing market in Norway, Sweden and Denmark.

In addition to the cash requirement during the implementation phase of new outsourcing contracts, the operation units running the customers' IT infrastructure and software applications need additional investments in production capacity in order to support long term revenue growth.

The co-localisation of new Ementor, and the overall reduction in headcount during the last years have created a substantial overcapacity of office space. The lack of sub-letting opportunities during 2003 and 2004 combined with current office rental market prospects has resulted in a need for additional provisions related to unutilised office space and long-term office lease obligations.

For further information please contact:
Ole Mjåtvedt, Executive Vice President & CFO, Ementor ASA, tel +47 24 09 92 28, mob +47 930 06 671

Ementor is one of the largest business consulting and IT solutions & services companies in the Nordic region. With expertise within consulting, technology and outsourcing, we help the most demanding of Nordic companies to improve their operational efficiency, create customer loyalty and build platforms for change. Ementor has 2 300 employees and is located in 21 cities across Norway, Denmark, Sweden, and Finland. The company is listed on the Oslo Stock Exchange. To find out more about what Ementor can offer, please visit www.ementor.com.