-
Vistin Pharma ASA (A public limited liability company organized under the laws of Norway)
Listing of the Shares in Vistin Pharma ASA on Oslo Axess in connection with the offering of 17,054,935 Offer Shares at a
Subscription Price of NOK 10 per Offer Share.
This prospectus (the Prospectus) relates to, and has been issued by Vistin Pharma ASA (the Company), solely for use in connection
with the offering (the "Offering") and listing on Oslo Axess, a regulated market operated by Oslo Brs ASA (the "Listing") of 17,054,935 new ordinary shares (the "Offer Shares") in the Company, each with a nominal value of NOK 1 and at a subscription price of NOK 10 per
Offer Share (the Subscription Price).
The Offering consists of (i) 15,554,935 new shares at NOK 10 per new share (the New Shares) are directed towards the shareholders of
Weifa ASA ("Weifa") as of 19 May 2015, registered as such in the Weifa's shareholder register in the Norwegian Central Securities
Depository (the "VPS") on 21 May (the "Record Date"), (the Rights Offering), who are not resident in a jurisdiction where such offering would be unlawful or would (in jurisdictions other than Norway) require any prospectus filing, registration or similar action (the
"Eligible Shareholders") and (ii) 1,500,000 new shares at NOK 10 per new share (the Employee Offer Shares) are directed towards the
Board of Directors, Executive Management and employees of the Company (the Employee Offering). The Employee Offering will be divided into three sub-tranches; (i) 500,000 Employee Offer Shares offered to the Companys Board of Directors, (ii) 500,000 Employee
Offer Shares offered to the Companys Executive Management, and (iii) 500,000 Employee Offer Shares offered to the Companys full-time
employees as of the date of the transferal of the Acquired Interests. The Subscription Price and Subscription Period are identical for the Employee Offering and the Rights Offering.
In the Rights Offering, each Eligible Shareholder will be granted one subscription right (the Subscription Rights) for every 102 Weifa ASA shares held as of the Record Date, rounded down to the nearest whole Subscription Right. One Subscription Right will, subject to
applicable law, give the holder the right to subscribe for and be allocated one New Share in the Company in the Rights Offering. Over-subscription is permitted. Subscription without Subscription Rights is not permitted.
The Subscription Period in the Rights Offering will commence on 26 May 2015 at 09:00 CET and (subject to extensions) expire at 16:30 CET on 4 June 2015 (the Subscription Period). The Subscription Rights are fully tradable and transferable, and will be listed on Oslo
Axess with ticker code VISTIN T and registered in VPS with ISIN NO 0010736952. Trading in the Subscription Rights on Oslo Axess
may take place from and including 26 May 2015 at 09:00 CET and until 2 June at 16:30 CET.
Total gross proceeds from the Offering will amount to NOK 170,549,350. Following the completion of the Offering, the total number of
issued Shares in the Company will be 17,054,935.
Subscription Rights that are not used to subscribe for Shares in the Rights Offering before the expiry of the Subscription Period will
have no value and will lapse without compensation to the holder.
Prior to the Offering, the Shares have not been publicly traded. On 23 April 2015, the Company applied for the Shares to be listed on Oslo Axess, and the listing application will be reviewed by the board of directors of Oslo Brs on 26 May 2015. The Shares are expected to be
delivered to the subscribers in the Offering on or about 10 June 2015 and be listed and tradable on Oslo Axess on or about 10 June 2015
under the ticker code VISTIN.
The distribution of this Prospectus and the Offering of the Offer Shares may in certain jurisdictions be restricted by law. Accordingly, this
Prospectus may not be distributed or published in any jurisdiction except under circumstances that are in compliance with any applicable
laws and regulations. The Company and the Manager (as defined below) require persons in possession of this Prospectus, in possession of Subscription Rights and/or considering to subscribe for Offer Shares to inform themselves about, and to observe, any such restrictions. This
Prospectus and the Offering shall be governed by, and construed in accordance with, Norwegian law. The courts of Norway, with Oslo City
Court as legal venue, shall have exclusive jurisdiction to settle any dispute which may arise out of, or in connection with, the Offering or this Prospectus.
Investing in the Company and the Shares involves material risks and uncertainties. See section 2 Risk Factors and section 4
Cautionary Note Regarding Forward-Looking Statements.
Manager:
22 May 2015
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VISTIN PHARMA ASA
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IMPORTANT INFORMATION
Please refer to section 17 for definitions of terms used throughout this Prospectus, which also apply to the
preceding page.
This Prospectus has been prepared in order to provide information about Vistin Pharma ASA and its business in
relation to the Offering and Listing of the Shares, and to comply with the Norwegian Securities Trading Act of
June 29, 2007 no. 75 (the Norwegian Securities Trading Act) and related secondary legislation, including
the Commission Regulation (EC) no. 809/2004 implementing Directive 2003/71/EC of the European Parliament
and of the Council of 4 November 2003 regarding information contained in prospectuses, as amended (the
Prospectus Directive), and as implemented in Norway.
This Prospectus has been prepared solely in the English language.
The Company has furnished the information in this Prospectus. The Company has engaged Carnegie AS as
manager (Carnegie or the "Manager") for the Offering and the Listing of the Shares. The Manager makes no
representation or warranty, express or implied, as to the accuracy or completeness of the information in this
Prospectus, and nothing contained in this Prospectus is, or shall be relied upon as, a promise or representation by
the Manager. Neither the Company nor the Manager has authorised any other person to provide investors with
any other information related to the Listing or the Offering, and neither the Company nor the Manager will
assume any responsibility for any information other persons may provide.
Unless otherwise indicated, the information contained herein is current as of the date hereof and the information
is subject to change, completion and amendment without notice. In accordance with section 7-15 of the
Norwegian Securities Trading Act, every significant new factor, material mistake or inaccuracy that is capable
of affecting the assessment of the Shares arising after the time of approval of this Prospectus and before the date
of Listing of the Shares on Oslo Axess, will be published and announced promptly as a supplement to this
Prospectus. Neither the publication nor distribution of this Prospectus shall under any circumstances create any
implication that there has been no change in the Company's affairs since the date hereof or that the information
herein is correct as of any time since its date.
The distribution of this Prospectus may in certain jurisdictions be restricted by law. Accordingly, this Prospectus
may not be distributed or published in any jurisdiction except under circumstances that are in compliance with
any applicable laws and regulations. The Company and the Manager require persons in possession of this
Prospectus to inform themselves about, and to observe, any such restrictions.
An investment in the Company involves inherent risks. Potential investors should carefully consider the risk
factors set out in section 2 Risk Factors as well as the information regarding forward-looking statements in
section 4 "Cautionary note regarding forward looking statements" and all other information contained herein
before making an investment decision. An investment in the Company is suitable only for investors who
understand the risk factors associated with this type of investment and who can afford a loss of their entire
investment. The contents of this Prospectus are not to be construed as legal, business or tax advice. Each
prospective investor should consult with its own legal adviser, business adviser and tax adviser as to legal,
business and tax advice.
In the ordinary course of their respective businesses, the Manager and certain of its affiliates have engaged, and
will continue to engage, in investment and commercial banking transactions with the Company.
Without limiting the manner in which the Company may choose to make any public announcements, and subject
to the Companys obligations under applicable law, announcements relating to the matters described in this
Prospectus will be considered to have been made once they have been received by Oslo Brs and distributed
through its information system.
The distribution of this Prospectus and the Offering and listing of the Shares on Oslo Axess, may be
restricted by law in certain jurisdictions. The Company and the Manager require persons in possession of
this Prospectus, in possession of Subscription Rights or considering to subscribe for Shares to inform
themselves about, and to observe, any such restrictions. This Prospectus does not constitute an offer of, or
an invitation to subscribe or purchase, any of the Shares in any jurisdiction in which such offer or
subscription or purchase would be unlawful. No one has taken any action that would permit a public
offering of the Shares to occur outside of Norway. In addition the Shares may in certain jurisdictions be
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VISTIN PHARMA ASA
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subject to restrictions on transferability and resale and may not be transferred or resold except as
permitted under applicable securities laws and regulations. Investors should be aware that they may be
required to bear the financial risks of an investment in the Shares for an indefinite period of time. Any
failure to comply with these restrictions may constitute a violation of the securities laws of any such
jurisdiction. Furthermore, the restrictions and limitations listed and described herein are not exhaustive,
and other restrictions and limitations in relation to the Offering and/or the Prospectus that are not known
or identified by the Company and the Manager at the date of this Prospectus may apply in various
jurisdictions as they relate to the Prospectus.
For other selling and transfer restrictions, see section 16 of this Prospectus.
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VISTIN PHARMA ASA
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TABLE OF CONTENTS
1. EXECUTIVE SUMMARY .......................................................................................................................... 6
2. RISK FACTORS ........................................................................................................................................ 16
3. STATEMENT OF RESPONSIBILITY ................................................................................................... 21
4. CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS .............................. 22
5. THE SALE AND THE LISTING ............................................................................................................. 23
6. THE OFFERING ....................................................................................................................................... 27
7. PRESENTATION OF VISTIN PHARMA .............................................................................................. 39
8. MARKET OVERVIEW ............................................................................................................................ 50
9. FINANCIAL INFORMATION ................................................................................................................ 55
10. BOARD OF DIRECTORS, EXECUTIVE MANAGEMENT AND EMPLOYEES ............................ 66
11. CORPORATE INFORMATION AND DESCRIPTION OF THE SHARE CAPITAL ...................... 73
12. SHAREHOLDER MATTERS AND NORWEGIAN COMPANY AND SECURITIES LAW ........... 76
13. LEGAL MATTERS ................................................................................................................................... 82
14. NORWEGIAN TAXATION ..................................................................................................................... 83
15. ADDITIONAL INFORMATION ............................................................................................................. 87
16. SELLING AND TRANSFER RESTRICTIONS ..................................................................................... 88
17. DEFINITIONS AND GLOSSARY OF TERMS ..................................................................................... 94
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VISTIN PHARMA ASA
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APPENDICES
Appendix A THE COMPANYS ARTICLES OF ASSOCIATION ........................................................................................
Appendix B AUDITED INTERIM FINANCIAL STATEMENTS FOR VISTIN PHARMA ASA FOR
THE INTERIM PERIOD 6 MARCH 2015 TO 31 MARCH 2015 ......................................................................
Appendix C
AUDITED SPECIAL PURPOSE CARVE-OUT FINANCIAL STATEMENTS FOR THE
ACQUIRED INTERESTS FOR THE YEARS ENDED 31 DECEMBER 2014 AND 2013 ..............................
Appendix D SUBSCRIPTION FORM RIGHTS OFFERING .................................................................................................
Appendix E
SUBSCRIPTION FORM EMPLOYEE OFFERING ..........................................................................................
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VISTIN PHARMA ASA
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1. EXECUTIVE SUMMARY
Summaries are made up of disclosure requirements known as "Elements". These elements are numbered in
Sections A E (A.1 E.7).
This summary contains all the Elements required to be included in a summary for this type of securities and
issuer. Because some Elements are not required to be addressed, there may be gaps in the numbering sequence
of the Elements.
Even though an Element may be required to be inserted in the summary because of the type of securities and
Issuer, it is possible that no relevant information can be given regarding the Element. In this case a short
description of the Element is included in the summary with the mention of "not applicable".
Section A Introduction and warnings
A.1 Warnings This summary should be read as an introduction to the Prospectus.
Any decision to invest in the Shares should be based on consideration of the
Prospectus as a whole by the investor.
Where a claim relating to the information contained in the Prospectus is brought
before a court, the plaintiff investor might, under the national legislation in its
Member State, have to bear the costs of translating the Prospectus before the legal
proceedings are initiated.
Civil liability attaches only to those persons who have tabled the summary
including any translation thereof, but only if the summary is misleading,
inaccurate or inconsistent when read together with the other parts of the
Prospectus or it does not provide, when read together with the other parts of the
Prospectus, key information in order to aid investors when considering whether to
invest in such securities.
A.2 Resale and
final
placement by
financial
intermediates
Not applicable. No resale will take place. No financial intermediaries will be used
for the final placement of the offer.
Section B - Issuer
B.1 Name Vistin Pharma ASA
B.2 Registered
office, legal
form and
country of
incorporation
Vistin Pharma ASA is a public limited liability company pursuant to the
Norwegian Public Limited Liability Companies Act, incorporated under the laws
of Norway. The Company was incorporated on 6 March 2015 by Weifa ASA for
the purpose of the Sale and the Listing and to be the holding company for Vistin
Pharma AS going forward. The Companys organisation number is 915157882,
and its registered office is stensjveien 27, 0609 Oslo, Norway with telephone
number: +47 35 98 42 00
B.3 Business
description
Introduction
Vistin Pharma ASA was incorporated on 6 March 2015 as a wholly-owned
subsidiary of Weifa ASA, a publicly listed company on the Oslo Stock Exchange,
which operates in the pharmaceutical industry. The Company will be a holding
company for Vistin Pharma AS, which will, subject to the success of the Offering,
acquire the Acquired Interests from Weifa AS on or about 1 June 2015. The
Acquired Interests will include all necessary operational assets and employees for
Vistin Pharma AS to become an independent and fully operational company
immediately following the completion of the Sale. Following the acquisition, the
Company will have one business segment with three business areas; Metformin,
Opioids and CMO tablet manufacturing.
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VISTIN PHARMA ASA
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Brief history
Up until the completion of the Sale, the Acquired Interests have been owned by
Weifa AS (Weiders Farmasytiske A/S), which was founded in 1940. The
Company opened its first production facility in Krager in 1952 and moved the
remaining manufacturing there in 1963.
Weifa AS started manufacturing of opioids in the 1950s when codeine phosphate
(API used in strong pain killers) based on poppy seeds was introduced, while
pholcodine was added to the opioid product portfolio in the 1980s. These
products, including codeine tablets, will make up Vistin Pharma AS opioid
offering following the Sale. The production of metformin was introduced in 1969,
and has since then been developed to include the supply of metformin HCl
(hydrochloride), metformin DC (direct compressible) and metformin tablets.
These products will make up Vistin Pharma AS metformin offering following the
Sale. Tablet manufacturing has been a core competence and business for Weifa
AS, but has not existed as a separate business. It will therefore be established as a
business area, CMO, upon completion of the Sale and will be further developed in
the following years.
Metformin
The Metformin business supplies metformin products in three different forms;
bulk powder, granulated pre-tablet form (DC) and finished dose tablets. These
products are sold to pharmaceutical companies worldwide and are used in the
treatment of type 2 diabetes.
Opioids
The Opioids business produces two types of opioid API products; codeine
phosphate (codeine) and pholcodine. Both products are used as an API in cough
medicine. In addition, codeine is used as an API in analgesics (pain killers). The
Opioids business also produces finished dose codeine tablets.
CMO Tablet Manufacturing
The new CMO tablet manufacturing business will produce finished products
through agreements with external parties. The Company has entered into a five
year agreement with Weifa AS for the production of Weifa AS key pain relief
brands, which will be the only CMO Agreement allocated to the business area at
the time of the Sale. The Company will seek to extend its customer portfolio going
forward.
B.4a Trend
information
There have been no material changes in production, sales and inventory, and costs
and selling prices for the Acquired Interests since the end of 2014 and up until the
date of this Prospectus.
The Company is not aware of any trends, uncertainties, demands, commitments or
events that could have a material effect on the Groups prospects for the current
financial year.
B.5 Organisation
al structure
Prior to the completion of the Sale, Vistin Pharma ASA and Vistin Pharma AS are
wholly owned subsidiaries of Weifa ASA. Following the Sale, the Group will
consist of the holding company, Vistin Pharma ASA, and its wholly owned
subsidiary; Vistin Pharma AS. It is the subsidiary, Vistin Pharma AS, that will be
responsible for all operational activities.
B.6 Major
shareholders
As of the date of this Prospectus, the Company has one (1) shareholder, Weifa
ASA, owning 100% of the outstanding shares.
B.7 Summary
financial
information
The following financial information has been derived from the Acquired Interests
audited special purpose carve-out financial statements for the years ended 31
December 2014 and 2013.
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VISTIN PHARMA ASA
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Statements of special purpose carve-out profit and loss and other comprehensive income
The Acquired Interests special purpose carve-out statements of profit and loss and other comprehensive income
for the two years ended 31 December 2014 and 2013 are set out below. These statements should be read in
conjunction with the basis of preparation set out in section 9.
NOK 1,000 2014 2013
Revenue........................................................................................................................................................... 361 461 347 253
Total revenue and income ............................................................................................................................. 361 461 347 253
Cost of materials ............................................................................................................................................. 154 708 147 819
Payroll expenses .............................................................................................................................................. 108 594 106 872
Depreciation, amortisation and impairment ..................................................................................................... 110 093 16 272
Other operating expenses ................................................................................................................................ 70 369 65 263
Operating profit/(loss) ................................................................................................................................... -82 304 11 027
Finance income ............................................................................................................................................... - 1 365
Finance costs ................................................................................................................................................... 2 080 -
Profit/(Loss) before tax from continuing operations .................................................................................. -84 383 12 393
Income tax expense ......................................................................................................................................... -22 784 4 008
Profit/(Loss) for the period ........................................................................................................................... -61 600 8 385
Other comprehensive income
Other comprehensive income not to be reclassified to profit or loss in subsequent periods
Re-measurement of pension plans ................................................................................................................... -2 552 24 868
Income tax effect ............................................................................................................................................. -689 6 714
Total other comprehensive income not to be reclassified to profit or loss................................................. -1 863 18 154
Other comprehensive income for the year, net of tax ................................................................................. -1 863 18 154
Total comprehensive income for the year, net of tax .................................................................................. -63 463 26 539
Total comprehensive income for the year, net of tax attributable to
Equity holders of the parent company ............................................................................................................ -63 463 26 539
Non-controlling interests ................................................................................................................................. - -
Total ............................................................................................................................................................... -63 463 26 539
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VISTIN PHARMA ASA
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Statements of special purpose carve-out financial position
Set out below are the Acquired Interests special purpose carve-out statements of financial position for the two
years ended 31 December 2014 and 2013. These statements should be read in conjunction with the basis of
preparation set out in section 9.
NOK 1,000 31.12.2014 31.12.2013
ASSETS
Non-current assets
Property, plant and equipment ......................................................................................................................... 28 278 129 574
Deferred tax assets* ........................................................................................................................................ 32 929 7 804
Total non-current assets ............................................................................................................................... 61 207 137 379
Current assets
Inventory ......................................................................................................................................................... 92 075 88 328
Trade receivables ............................................................................................................................................ 47 660 45 128
Other receivables ............................................................................................................................................. 2 732 -
Total current assets ....................................................................................................................................... 142 466 133 456
Total assets ..................................................................................................................................................... 203 673 270 835
INVESTED CAPITAL AND LIABILITIES
Invested capital
Parent company investment ............................................................................................................................. 127 977 199 777
Total invested capital .................................................................................................................................... 127 977 199 777
Non-current liabilities
Net employee defined benefit liability............................................................................................................. s 9 325 5 648
Total non-current liabilities .......................................................................................................................... 9 325 5 648
Current liabilities
Trade payables ................................................................................................................................................ 39 104 33 593
Other current liabilities .................................................................................................................................... 27 267 31 816
Total current liabilities ................................................................................................................................. 66 371 65 409
Total liabilities ............................................................................................................................................... 75 696 71 057
Total equity and liabilities ............................................................................................................................ 203 673 270 835
*The deferred tax asset cannot be transferred as a part of the net asset transaction of the Acquired Interests and Vistin Pharma will
therefore be in an immediate taxable position if it generates taxable income in its first year of operation. See section 9.4.1 for a further
description.
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VISTIN PHARMA ASA
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Special purpose carve-out cash flow statements
The table below summarises the Acquired Interests special purpose carve-out statements of cash flow for the
two years ended 31 December 2014 and 2013. These statements should be read in conjunction with the basis of
preparation set out in section 9.
NOK 1,000 2014 2013
Cash flow from operating activities
Net profit/(loss) before income tax .................................................................................................................. -84 383 12 393
Non-cash adjustment to reconcile profit before tax to cash flow:
Difference between pension costs and in-/out payment in pension scheme ..................................................... 1 153 1 153 -432
Depreciation, amortisation and impairment ..................................................................................................... 110 093 16 272
Unrealised foreign currency (gains)/losses ...................................................................................................... 245 -
Changes in working capital:
Changes in trade receivables and trade creditors ............................................................................................. 2 735 -1 363
Changes in inventory ....................................................................................................................................... -3 746 -10 511
Changes in other accruals ................................................................................................................................ -8 963 4 842
Net cash flow from operating activities ........................................................................................................ 17 133 21 200
Cash flow from investing activities
Purchase of equipment .................................................................................................................................... -8 797 -8 197
Net cash flow from investing activities ......................................................................................................... -8 797 -8 197
Cash flow from financing activities
Net invested capital transferred** ................................................................................................................... -8 337 -13 002
Net cash flow from financing activities ........................................................................................................ -8 337 -13 002
Net change in cash and cash equivalents* ....................................................................................................... - -
Cash and cash equivalents beginning period ................................................................................................... - -
Cash and cash equivalents end period ......................................................................................................... - -
* No cash and cash equivalents are part of the Acquired Interests as the funding of the Company should be done through the Offering. ** Movement on invested capital is a net amount of change in invested capital considering all cash is left with Weifa AS.
B.8 Pro forma
financial
information
Not applicable. This Prospectus does not contain any pro forma financial
information.
B.9 Profit
forecast or
estimate
Not applicable. The Company has not provided a profit forecast in this Prospectus.
B.10 Qualifications
in the audit
report
Ernst & Young AS has audited the Acquired Interests special purpose carve-out
annual accounts for the financial year 2014 and Nitschke AS has audited the
Acquired Interests special purpose carve-out annual accounts for the financial
year 2013. The Auditors reports for the two years were issued without
qualifications.
B. 11 Working
capital
The Company is of the opinion that the working capital available to the Company
is sufficient for the Companys present requirements, for the period covering at
least 12 months from the date of this Prospectus.
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VISTIN PHARMA ASA
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Section C Securities
C.1 Type of
securities and
ISIN number
The Companys tradable Shares will carry the securities number ISIN NO
0010734122
C.2 Currency NOK
C.3 Number of
shares and par
value
The Companys current share capital is NOK 1,000,000 divided into 1,000,000
ordinary shares, each with a nominal value of NOK 1.0.
C.4 Rights
attached to the
securities
The Company has one class of shares. The Shares are equal in all respects,
including the right to dividend; voting rights; rights to share in the issuers profit;
rights to share in any surplus in the event of liquidation; redemption provisions;
reserves or sinking fund provisions; liability to further capital calls by the issuer;
and any provision discriminating against or favoring any existing or prospective
holder of such securities as a result of such shareholder owning a substantial
number of shares. Each Share carries one vote at the Company's general
meeting.
C.5 Restrictions on
free
transferability
The Shares are freely transferable and, subject to the Articles of Association of
the Company and any applicable securities law, there are no restrictions in the
Companys securities.
C.6 Listing and
admission to
trading
The first day of listing of Vistin Pharma ASA on the Oslo Stock Exchange is
expected to be on or about 10 June 2015 and trading in the shares will
commence on the date of listing under the ticker symbol VISTIN.
C.7 Dividend
policy
The Board shall, in cooperation with the Executive Management, issue the
Companys dividend policy and shall annually submit proposal for distribution
of dividend to the General Meeting.
It is an objective of the Company to generate high and stable returns, which is at
least on the same level as other investment possibilities with comparable risk.
This will be achieved, first and foremost, through strong and profitable growth
within the Companys business areas. To support this growth the Companys
earnings will be reinvested in the Company and no dividend is therefore
expected to be paid in the near future.
Section D Risks
D.1 Risks related
to the Group
Business and industry-related risks
- Changes in the political environment, laws and regulations that affect the pricing and regulatory status of the Companys products
- The ability to attract and retain competent personnel - New findings regarding adverse effects or other side-effects related to the
Companys products
- Fluctuations in the price and availability of raw materials - Regulatory approvals affecting the Companys authorisation to
manufacture, market and sell its products
- Historical underperformance in the Metformin and Opioids business areas
- Changes in the competitive landscape or market price for the Metformin and Opioid APIs
- CMO contract manufacturing as a new business area - Impact of cost overruns related to the CMO business area that operates
on a fixed price contract with Weifa AS, based on estimated costs at the
time of entering into the contract
- High dependency on a single contract for the CMO business area that will also constitute a substantial share of total revenue
- Environmental issues related to an ongoing investigation that could lead
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VISTIN PHARMA ASA
12
to a fine and the application for new emissions permits that could
potentially impact the production process
- No operating history outside the Weifa Group
Financial risks
- Limited access to funds - Credit risk - Foreign exchange risk - Liquidity risk
D.3 Risks related
to the
Companys
shares
Risk factors related to the ownership of the shares
- No prior market for the shares and an active market may not develop - Volatile market price - Future share issues may dilute existing shareholders - Issue of additional securities in relation to acquisitions, any share
incentive or option plan may dilute existing shareholders
- Sale of Shares may reduce the Share price and adversely affect the Companys ability to raise additional capital
- The Company does not expect to pay any cash dividends for the foreseeable future
- Investors outside of Norway are subject to exchange rate risk - Holders of Shares that are registered in a nominee account may not be
able to exercise voting rights and other shareholder rights
- The transfer of Shares is subject to transfer restrictions
Section E Offer
E.1 Net proceeds The Company will bear the fees and expenses related to the Offering. These are
estimated to amount to approximately NOK 9 million, resulting in net proceeds of
NOK 161.5 million.
E.2a Use of
proceeds
The Company intends to use NOK 120 million of the Offering to settle the
purchase price for the Acquired Interests. The balance, net of transaction costs,
(~NOK 41 million) will be used for working capital and to fund future business
needs.
E.3 Terms and
conditions of
the offer
The Offering consists of 17,054,935 shares divided into two tranches:
- 15,554,935 new shares at NOK 10 per new share are directed towards
the shareholders of Weifa ASA as of 19 May 2015 (the Rights
Offering).
- 1,500,000 new shares at NOK 10 per new share are directed towards the
Board of Directors, Executive Management and employees of the
Company (the Employee Offering).
The Subscription Period in all tranches is identical and will commence on 26 May
2015 at 09:00 CET and expire at 16:30 CET on 4 June 2015. The Subscription
Period may be extended by the Board, but may not in any event end later than 25
June 2015.
The Rights Offering
Each Eligible Shareholder will be granted one tradable Subscription Right for
every 102 Weifa ASA shares owned as of the Record Date. One Subscription
Right will, subject to applicable securities law, give the holder the right to
subscribe for and be allocated one New Share in the Company in the Rights
Offering.
The trading period for the Subscription Rights commence on 26 May 2015 at
09:00 CET and expire at 16:30 CET on 2 June 2015. The allocation of the New
Shares will take place after the expiry of the Subscription Period on or about 5
June 2015.
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VISTIN PHARMA ASA
13
The Subscription Right may be used to subscribe for New Shares in the Rights
Offering before expiry of the Subscription Period on 4 June 2015 at 16:30 CET or
alternatively be sold before the end of trading in the Subscription Rights on Oslo
Axess on 2 June 2015. Subscription Rights which are not sold before end of
trading on Oslo Axess on 2 June 2015 or exercised before the end of the
Subscription Period on 4 June 2015 will have no value and will lapse without
compensation to the holder. Acquired Subscription Rights will give the same
right to subscribe for and be allocated New Shares as Subscription Rights held by
Eligible Shareholders on the basis of their holdings on the Record Date.
The Subscription Rights are fully tradable and transferable, and will be listed on
Oslo Axess with ticker code VISTIN T and registered in VPS with ISIN NO
0010736952.
Over-subscription is permitted, but subscription without Subscription Rights is
not permitted. Subscribers subscribing on the basis of Subscription Rights, who
over-subscribe (i.e. subscribe for more New Shares than the number of
Subscription Rights held by them), will have priority to the New Shares not
subscribed for by holders of Subscription Rights. However, in each case there can
be no assurance that New Shares will be allocated for such subscriptions.
The allocation of New Shares to the subscribers will be made on the basis of
granted and acquired Subscription Rights that have been validly exercised during
the subscription period. If not all subscription rights are validly exercised during
the subscription period, the remaining shares will be allocated to over-subscribed
investors on a pro rata basis. Any New Shares remaining after allocation to the
investors, who have over-subscribed, will be allocated to the participants of the
Underwriting Syndicate, who have not fulfilled their underwriting obligations
based on and in accordance with their respective underwriting obligations.
The Employee Offering
The share issue directed towards the Board of Directors, Executive Management
and employees of the Company is split into three sub-tranches; (i) 500,000
Employee Offer Shares offered to the Companys full-time employees as of the
date of the transferal of the Acquired Interests, (ii) 500,000 Employee Offer
Shares offered to the Companys Executive Management and (iii) 500,000
Employee Offer Shares offered to the Companys Board of Directors. The
minimum subscription in each sub-tranche is 500 Employee Offer Shares.
Allocation of the Employee Offer Shares shall be made by the Board of Directors,
and will take place on or about 5 June 2015. The following allocation criteria
shall apply for the various sub-tranches:
Employees: The employees will receive full allocation of subscribed shares up to
a maximum of 3,400 shares per subscriber. In the event that total subscription
exceeds the 500,000 shares, and not all employees utilize their subscription rights,
the employees who have over-subscribed will receive the same number of shares
beyond the guaranteed allocation. In the event that the employee sub-tranche is
not fully subscribed, the remaining shares may be allocated to the members of the
Executive Management and the Board, who have not received full allocation in
their respective sub-tranches.
Executive Management: Members of the Executive Management will receive full
allocation of subscribed shares up to a maximum of 83,300 shares per subscriber.
In the event that total subscription exceeds the 500,000 shares, and not all
members of the Executive Management utilize their subscription rights, then
those who have over-subscribed will receive the same number of shares beyond
the guaranteed allocation. In the event that the Executive Management sub-
tranche is not fully subscribed, the remaining shares may be allocated to
employees and members of the Board, who have not received full allocation in
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VISTIN PHARMA ASA
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their respective sub-tranches.
Board of Directors: The Companys Board Members will receive full allocation
of subscribed shares up to a maximum of 100,000 shares per subscriber. In the
event that total subscription exceeds the 500,000 shares, and not all members of
the Board of Directors utilize their subscription rights, then those who have over-
subscribed will receive the same number of shares beyond the guaranteed
allocation. In the event that the sub-tranche offered to the Board is not fully
subscribed, the remaining shares may be allocated to employees and members of
the Executive Management who have not received full allocation in their
respective sub-tranches.
Any Employee Offer Shares not allocated based on the allocation principles set
out above, will be allocated to over-subscribers in the Rights Offering on a pro
rata basis. Any Employee Offer Shares not allocated following allocation to over-
subscribers will be allocated to the Underwriters.
E.4 Material
interest in the
offer
The following members of the Board of Directors are part of the Underwriting
Syndicate:
- Strata Marine & Offshore AS, Ferncliff Listed DAI and AS Ferncliff, companies controlled by the Board member ystein Stray Spetalen,
have guaranteed NOK 25 million of the Offering
- Ole Enger has guaranteed NOK 5 million of the Offering - Cipriano AS, a company controlled by Einar J. Greve, who will be
appointed as a Board member following the Listing, has guaranteed
NOK 5 million of the Offering.
The above mentioned Board members will thus be allocated the remaining Offer
Shares not subscribed for in the event that the Offering is not fully subscribed,
and, as such, have an interest in the Offering.
Further, in connection with the Rights Offering, the Underwriters, Board
members and members of the Executive Management may receive Subscription
Rights (if they are Eligible Shareholders) and may exercise their right to take up
such Subscription Rights and subscribe for New Shares, and, in that capacity,
may retain, purchase or sell Subscription Rights or New Shares and any other
securities of the Company or other investments for their own account and may
offer or sell such securities (or other investments) other than in connection with
the Offering. Neither the Manager nor the Underwriters intend to disclose the
extent of any such investments or transactions other than in accordance with any
legal or regulatory obligation to do so.
Other than what is set out above, the Company is not aware of any other material
interests to the Offering involving any Board members or Executive Management
of the Company.
The Manager and its affiliates may provide in the future, investment and
commercial banking services to the Company and its affiliates in the ordinary
course of business, for which they may receive customary fees and commissions.
The Manager will receive a fixed fee in relation to the Offering.
Other than what is set out above, the Company is not aware of any interest,
including conflicting ones, of any natural or legal persons involved in the
Offering.
E.5 Selling
shareholders
and lock-up
There are no selling shareholders in the Offering and no lock-up on the Offer
Shares.
E.6 Dilution The number of Offer Shares to be issued is 17,054,935, all with a nominal value
of NOK 1.00 per Share. The one (1) million Shares currently owned by Weifa
ASA will be redeemed prior to the Listing. Thus, the Companys share capital
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VISTIN PHARMA ASA
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following the Offering and Listing will be NOK 17,054,935, consisting of
17,054,935 Shares, each with a par value of NOK 1.00.
E.7 Estimated
expenses
Not applicable. The Company will not charge the investors for the expenses
related to the Offering.
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2. RISK FACTORS
An investment in the Shares involves a number of risks. If any of the following risks and uncertainties actually
occurs, the Group's cash flows, business, results of operations and financial position could be adversely
affected. In that case, the trading price of the Shares could decline and potential investors could lose all or part
of their investment. An investment in the Shares is suitable only for investors who understand the risks
associated with this type of investment and who can afford to lose all or part of their investment
The order in which the risks are presented does not necessarily reflect the likelihood of their occurrence or the
magnitude of their potential impact on the Group's cash flows, business, results of operations and financial
position. The risks could materialise individually or cumulatively.
2.1 BUSINESS AND INDUSTRY-RELATED RISKS
2.1.1 Changes in the political environment, laws and regulations may affect the pricing and regulatory status for Vistin Pharmas products
The products that will be produced by Vistin Pharma are subject to approvals and price regulations by the
regulatory authorities. Changes in political regimens may lay the ground for increased regulations, or more
liberal markets. New laws and regulations will likely be the tool to implement such changes. A change in
regulations could make it difficult for the Company to operate in markets where it is currently present or prevent
the Company from entering new markets. Such changes in political environment, laws and regulations may
affect the Companys business, financial condition and results of operation.
2.1.2 Access to key personnel and resources
Vistin Pharma is in many of its operations dependent upon competent personnel, and the human capital is an
important part of Vistin Pharmas assets. Vistin Pharma is headquartered in Oslo, Norway, with manufacturing
plants, laboratories and storage facilities in the small town of Krager in southern Norway. Vistin Pharmas
access to and ability to attract and retain competent personnel and consultants may in the short and/or long term
influence the Companys business, financial condition and results of operation.
2.1.3 New findings regarding adverse effects or other side-effects related to Vistin Pharmas products may negatively impact the Companys business, financial condition and results of operation
Potential adverse effects or side-effects of marketed drugs are continuously monitored by every regulatory
authority worldwide. Every pharmaceutical company with a marketing authorisation is required to monitor and
record adverse events throughout the lifetime of the product. As was the case with the anti-inflammatory drug
Vioxx(1)
, serious adverse effects were discovered long after the product was first launched. Although Vistin
Pharmas products are generally based on well-known active ingredients, new adverse effects may be
discovered in the future. Such adverse effects may temporarily or permanently influence the Companys
business, financial condition and results of operation.
Note: (1) Vioxx was introduced as a superior painkiller by the American pharmaceutical company Merck in 1999 but was
withdrawn in 2004 following a study indicating that the drug raised the risk of heart attack. Merck was later required to
establish a USD 4.85 billion settlement fund to cover expenses related to thousands of lawsuits related to the drug.
2.1.4 The price and availability of raw materials may fluctuate over time and thus impact the
profitability of each of the Companys products made from such raw materials
Vistin Pharma purchases raw materials from suppliers all around the world. Vistin Pharma has a strong logistics
and supply chain organisation, which is specialised in optimising supply, reliability, quality and price. However,
the price and availability of raw materials may fluctuate over time, and this may temporarily or permanently
influence the Companys business, financial condition and results of operation.
2.1.5 Regulatory approvals may affect Vistin Pharmas authorisation to manufacture, market and sell APIs, semi-finished and finished products
Vistin Pharma is dependent upon national and international regulatory approvals in order to manufacture,
market and sell APIs, semi-finished and finished products. Such approvals include, amongst others, so-called
good manufacturing practice (GMP) certificates for the manufacturing plants and marketing authorisations for
finished products. Vistin Pharma will be regularly inspected by the relevant authorities to maintain such
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VISTIN PHARMA ASA
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approvals, certificates and authorisations. In line with industry standards for the pharmaceutical industry, Vistin
Pharma has established a rigid quality system internally to ensure compliance with international laws and
regulations at all times for each product and manufacturing line/unit. Such systems include amongst others
standard operating procedures (SOPs) and batch manufacturing records as well as rigid quality controls for the
intermediates and finished products. If Vistin Pharma fails to comply with regulations and fails an inspection by
a regulatory authority, this may temporarily or permanently influence the Companys business, financial
condition and results of operation.
2.1.6 The Metformin and Opioids business areas have historically shown periods of underperformance, and any underperformance in the future may affect the Companys business, financial condition
and results of operation
Historically, the Metformin and Opioids business areas have not been profitable. These business areas sell active
ingredients, semi-finished and finished products to other pharmaceutical companies. Their profitability is,
amongst other things, dependent upon raw material costs, manufacturing costs, labour costs and sales prices.
The profitability of the Metformin and Opioids business areas have over the last years systematically improved
through inter alia negotiating lower prices for raw materials, increasing manufacturing volumes and yields (and
thus reduced manufacturing cost), moving up the value-chain by providing semi-finished and finished products,
and moving their business towards high-value customers willing to pay more for reliable and high-quality
products. Although profitability has increased over the last years, external factors such as demand, competition
and raw materials costs may negatively affect the profitability in the future, and this may temporarily or
permanently influence the Companys business, financial condition and results of operation.
2.1.7 Changes in the competitive landscape or market price for the metformin and opioid APIs, semi-finished and finished products may affect the Companys business, financial condition and results
of operation
While the markets for metformin and opioids have been growing steadily over the last decades and only a few
companies are allowed to manufacture opioids due to strong international control and regulations, both markets
may be characterised as commodity markets. Future changes in the competitive landscape in each market may
therefore affect the Companys business, financial condition and results of operation.
2.1.8 Specific risks related to the Metformin business area
Metformin has been established as the first-line treatment for type 2 diabetes in most countries worldwide.
Although there are no indications that metformin will be replaced by another first-line treatment of diabetes 2,
the future expiration of patents on existing products, as well as the introduction of new products may bring
drugs that directly or indirectly compete with metformin. Lifestyle changes in the future may also lead to fewer
people developing type 2 diabetes during their lifetime and thus the market may decrease in the future. Such
decrease in the use of metformin or increased competition in the future may influence the Companys business,
financial condition and results of operation.
2.1.9 Specific risks related to the Opioid business area
Opioids have been used as strong pain remedies and cough suppressants for decades. Although there are no
indications that opioids will be replaced in the near term, the future may bring new products to market that
directly or indirectly will compete with opioids from Vistin Pharma. Such decrease in the use of opioids or
increased competition in the future may influence the Companys business, financial condition and results of
operation.
2.1.10 Specific risks related to the CMO tablet manufacturing business area
Weifa AS has produced finished dose tablets for external customers for many years, and has been supplying
products to recognized international pharmaceutical companies. The Company is in that respect an experienced
CMO operator. However, the CMO tablet manufacturing business has never existed as a separate business area
and it is therefore difficult to assess how it will perform, as such, going forward.
The Company has entered into a long-term CMO agreement with Weifa AS for the supply of certain products
where the price is determined based on estimated production costs at the time of entering into the contract. In
this contract, the Company carries all risk related to cost overruns relative to the estimated production costs,
with the exception of cost overruns above said level that are directly caused by certain predetermined input
factors in which Weifa AS takes all risk. If the Company is unable to meet the budgeted production costs in
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VISTIN PHARMA ASA
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which the CMO agreement is based on, it would negatively influence the Companys business, financial
condition and results of operation.
The CMO agreement that Vistin Pharma AS has entered into with Weifa AS will constitute a substantial share
(~NOKm 120) of the Companys revenue. The agreement has an initial duration of five years with the option to
extend it for another two years at the discretion of Weifa AS. In the event that Vistin Pharma fail at maintaining
a competitive manufacturing process for the products it supplies to Weifa AS the contract might not be renewed.
If the contract with Weifa AS is not extended it could negatively influence the Companys business, financial
condition and results of operation.
2.1.11 Risk factors related to environmental issues
The two manufacturing plants in Krager (Gruveveien and Fikkjebakke) that will be transferred from Weifa AS
to Vistin Pharma following the acquisition of the Acquired Interests have faced environmental issues concerning
emissions and emission permits.
In 2013, unauthorized emissions were registered at the production site at the Gruveveien plant. The situation
was investigated by the Climate and Pollution Agency, which resulted in further (ongoing as of date)
investigations by the police.
The Climate and Pollution Agency required in 2014 reduction of emissions from both plants. All emissions from
Gruveveien were immediately stopped and collected for disposal and the production has been running
uninterrupted at full capacity. An application for a new permanent emission permit for Gruveveien will be
submitted in June 2015, and is expected to be approved within 9 months (March 2016).
Weifa AS received a temporary emission permit for the Fikkjebakke plant in July 2014. An application for a
permanent emission permit was submitted in December 2014 and the permanent emission permit for
Fikkjebakke is expected to be received in October 2015.
Weifa AS has dedicated considerable resources to identify, analyse, control and reduce the emissions. The
Company has engaged external consultants, strengthened its competence within HSE, employed a new Vice
President of Operations and Quality and established a project group that is responsible for monitoring the
Companys progress towards specified emission goals. The initiatives have resulted in a ~85 percent reduction
in the emission of solvents and pharmaceutical remnants, and the remaining emissions are currently being
combusted. Following the Companys initiatives, the risk for unwanted interruption or reduction of activity in
the factories due to emission related issues is considered to be very low. However, in the event that the ongoing
police investigations would lead to a charge against the Company or that the application for permanent
emissions permits are declined it could negatively impact the Companys business, financial condition and
results of operation.
2.1.12 The Company does not have an operating history outside of the Weifa Group and investors may have difficulty assessing its historical performance and outlook for future revenues and other
operating results.
The Company was incorporated on 6 March 2015 and, consequently, does not have an operating history as a
separate entity. Financial information upon which prospective investors can evaluate the Company's historical
financial performance is available only from the special purpose carve-out financial information that the
Company has included in this Prospectus and that reflect the activities of the Acquired Interests currently owned
by Weifa AS. The financial information in this Prospectus may not necessarily reflect what the Acquired
Interests results of operations, financial condition and cash flows would have been had they operated as a
separate, stand-alone entity for the periods presented. Consequently, the financial statements and the other
historical financial information included in this Prospectus do not necessarily reflect Vistin Pharma's future
results of operations, financial condition, cash flows or costs and expenses.
2.2 FINANCIAL RISK
2.2.1 Limited access to funds
The Company may be dependent on obtaining future financing and/or new equity to enable the contemplated
future growth of the Group. No assurance can be given that it will be able to obtain future financing, or that it
will be able to raise new equity capital.
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VISTIN PHARMA ASA
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2.2.2 Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer
contract, leading to a financial loss. The Group is exposed to credit risk from its operating activities (primarily
trade receivables) and from its treasury management, including deposits with banks and financial institutions.
2.2.3 Foreign exchange risk
Vistin Pharma will offer products to the global pharmaceutical market and the Company is exposed to currency
exchange fluctuations, as most sales within the metformin and opioid business are in EUR and USD. Some of
these sales are partly covered by a natural hedge, as most of the raw material costs are denominated in USD, and
the Group also enters into currency hedging contracts to reduce the foreign exchange risk. Currency exchange
rates are determined by forces of supply and demand on the currency exchange markets, which again are
affected by the international balance of payments, economic and financial conditions and expectations,
government intervention, speculation and other factors. Changes to these foreign exchange rates in particular
may affect the Companys business, financial condition and results of operation.
2.2.4 Liquidity risk
Liquidity risk is the potential loss arising from the Group's inability to meet its contractual obligations when
due. The operation of the Groups business requires significant capital, and there can be no assurance that it will
be able to obtain the necessary liquidity to meet its financial liabilities as they fall due. The Groups future
liquidity needs depend on a number of factors, and is subject to uncertainty with respect to inter alia future
earnings, outcome of legal claims and disputes, etc. A limited liquidity position may have an adverse effect on
the Groups business, financial condition, results of operation and liquidity, and as a worst case, force the
Company to cease its operations.
2.3 RISK FACTORS RELATED TO THE OWNERSHIP OF THE SHARES
2.3.1 There is no existing market for the Shares, and an active trading market may not develop
The Companys Shares will subsequent to the Listing be traded on Oslo Axess. This, however, does not imply
that there will be a liquid market for the Companys Shares.
Prior to the Offering, there was no public market for the Shares, and there can be no assurances that an active
trading market will develop, or be sustained or that the Offer Shares will be capable of being resold at or above
the Subscription Price. The market value of the Shares could be substantially affected by the extent to which a
secondary market develops for the Shares following the completion of this Offering. In the case of low liquidity
of the Shares, or limited liquidity among the Companys shareholders, the share price can be negatively affected
and may not reflect the underlying value of the Companys assets.
2.3.2 The market price of the Shares may be highly volatile
The market price of the Shares could fluctuate significantly in response to a number of factors, including the
following:
- actual or anticipated variations in operating results - changes in financial estimates or recommendations by stock market analysts regarding the Company - announcements by the Company of significant acquisitions, partnerships, joint ventures or capital
commitments
- sales or purchases of substantial blocks of Shares - additions or departures of key personnel - future equity or debt offerings by the Company and its announcements of these offerings - general market and economic conditions
Moreover, in recent years, the stock market in general has experienced large price and volume fluctuations and
these broad market fluctuations may adversely affect the share price, regardless of its operating results.
2.3.3 Shareholders not participating in future offerings of Shares may be diluted
Shareholders not participating in future offerings of Shares may be diluted. Unless otherwise resolved or
authorised by the general meeting of the Company, shareholders in Norwegian public companies, such as the
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VISTIN PHARMA ASA
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Company, have pre-emptive rights proportionate to the aggregate amount of the Shares they hold with respect to
new Shares issued by the Company. However, shareholders that choose to not exercise such pre-emptive right
may experience dilution of their shareholding. Furthermore, local selling and transfer restrictions may limit
certain shareholders to exercise their pre-emptive rights.
If the Company, in an equity issue, resolves to deviate from the shareholders' pre-emptive rights, this may also
result in a substantial dilution of the shareholding of shareholders not being invited to participate in such equity
issue.
2.3.4 Future issuances of Shares or other securities could dilute the holdings of shareholders
The Company may seek to issue additional equity or convertible equity securities to fund future acquisitions and
other growth opportunities, or in connection with share incentives and option plans. Exercising options may also
cause a dilution of existing shareholders. To the extent that the Company issues additional securities, the
existing shareholders' ownership interest in the Company at that time may be diluted.
2.3.5 Future sales, or the possibility for future sales of substantial numbers of Shares could affect the
Shares market price
The Company cannot predict what effect, if any, future sales of the Shares, or the availability of Shares for
future sales, will have on the market price of the Shares. Sales of substantial amounts of the Shares in the public
market following the Offering, or the perception that such sales could occur, could adversely affect the market
price of the Shares, making it more difficult for holders to sell their Shares and for the Company to sell equity
securities in the future at a time and price that they deem appropriate.
2.3.6 The Company does not expect to pay any cash dividends for the foreseeable future
The Company does not intend to pay any dividends for the foreseeable future. Instead, the Company plans to
retain any earnings to maintain and expand its existing operations. In addition, any future debt financing
arrangement may contain terms prohibiting or limiting the amount of dividends that may be declared or paid on
the Shares. Accordingly, investors must rely on sales of their Shares after price appreciation, which may never
occur, as the only way to obtain return on their investment.
2.3.7 The Company's investors outside of Norway are subject to exchange rate risk
The Shares are traded in NOK and any investor outside of Norway that wishes to invest in the Shares, or to sell
Shares, will be subject to an exchange rate risk which may cause additional costs to the investor.
2.3.8 Holders of Shares that are registered in a nominee account may not be able to exercise voting
rights and other shareholder rights as readily as shareholders whose Shares are registered in their own
names with the VPS
Beneficial owners of Shares that are registered in a nominee account (e.g., through brokers, dealers or other
third parties) may not be able to vote such Shares unless their ownership is re-registered in their names with the
VPS prior to the Company's general meetings. The Company cannot guarantee that such beneficial owners of
Shares will receive the notice for a general meeting in time to instruct their nominees to either effect a re-
registration of their Shares or otherwise vote their Shares in the manner desired by such beneficial owners.
Further, beneficial owners of Shares that are registered in a nominee account may not be able to exercise other
shareholder rights under the Norwegian Public Limited Companies Act (such as e.g. the entitlement to
participate in a rights offering) as readily as shareholders whose Shares are registered in their own names with
the VPS.
2.3.9 The transfer of Shares is subject to transfer restrictions
The transfer of Shares is subject to restrictions under the securities laws of the United States and other
jurisdictions. The Shares have not been registered under the U.S. Securities Act of 1933 or any U.S. state
securities laws or any other jurisdiction outside Norway and are not expected to be registered in the future. As
such, the Shares may not be offered or sold in the United States or to a U.S. person except pursuant to an
exemption from the registration requirements of the US Securities Act and applicable securities laws.
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3. STATEMENT OF RESPONSIBILITY
The Board of Directors of Vistin Pharma ASA accepts responsibility for the information contained in this
Prospectus and hereby declares that, having taken all reasonable care to ensure that such is the case, the
information contained in this Prospectus is, to the best of their knowledge, in accordance with the facts and
contains no omissions likely to affect its import.
Oslo, 22 May 2015
The Board of Directors of Vistin Pharma ASA
Ole Enger
Chairman
ystein Stray Spetalen
Board member
Kathrine Gamborg Andreassen
Board member
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VISTIN PHARMA ASA
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4. CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
This Prospectus contains forward-looking statements relating to Vistin Pharma's business and the sectors in
which it will operate. Forward-looking statements include all statements that are not historical facts, and can be
identified by words such as anticipates, believes, expects, intends, may, plans, projects, seeks,
should, will, or the negatives of these terms or similar expressions. These forward-looking statements, as a
general matter, are all statements other than statements as to historic facts or present facts and circumstances.
Forward-looking statements appear in the following sections of this Prospectus, section 5 The sale and the
listing, section 7 Presentation of Vistin Pharma, section 8 Market overview, section 9 Financial
Information and section 11 Corporate information and description of the Share Capital.
No forward-looking statements contained in this Prospectus should be relied upon as predictions of future
events. These forward-looking statements are based on Vistin Pharma's present plans, estimates, projections and
expectations. They are based on certain expectations, which, even though they seem to be adequate at present,
may turn out to be incorrect. No assurance can be given that the expectations expressed in these forward-looking
statements will prove to be correct. Actual results could differ materially from expectations expressed in the
forward-looking statements if one or more of the underlying assumptions or expectations proves to be inaccurate
or is unrealized. Factors that could cause actual results to differ materially from those in the forward-looking
statements are included in section 2 Risk Factors.
Readers are cautioned not to place undue reliance on the forward-looking statements contained in this
Prospectus, which represent the best judgment of Vistin Pharma as of the date of this Prospectus. Except as
required by applicable law, Vistin Pharma does not undertake responsibility to update these forward-looking
statements, whether as a result of new information, future events or otherwise. Readers are advised, however, to
consult any further public disclosures made by the Company, such as filings made with Oslo Brs or the
Companys press releases.
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5. THE SALE AND THE LISTING
5.1 BACKGROUND
On 13 March 2015 Weifa announced that the Board of Directors will propose to cause its subsidiary Weifa AS
to sell its business-to-business and CMO tablet production operations (the "Acquired Interests") to Vistin
Pharma AS, a wholly-owned subsidiary of Weifa ASA (the "Sale"). The purchase price payable by Vistin
Pharma AS, as consideration for the Acquired Interests, is determined on arms-length terms, and amounts to
NOK 120 million. In connection with the contemplated Sale, Weifa ASA established Vistin Pharma ASA on 6
March 2015 ("Vistin Pharma" or the Company), a public limited liability company incorporated under the
laws of Norway, for the purpose of being the holding company for Vistin Pharma AS. Vistin Pharma applied for
listing of its shares on Oslo Axess on 23 April 2015 (the "Listing").
On 17 April 2015 Vistin Pharma AS entered into a business transfer agreement (the "BTA") with Weifa AS
regarding the acquisition of the Acquired Interests, and the Sale was approved by the shareholders of Weifa
ASA at an extraordinary general meeting held 16 April 2015. The acquisition of the Acquired Interests from
Weifa AS, is i.a. subject to completion (to be determined by the Company when such completion is
unconditional) by Vistin Pharma of an offering of new shares in an amount of at least NOK 170 million. The
Acquired Interests are, subject to comfort on a successful completion of the Offering, expected to be transferred
to Vistin Pharma AS on or about 1 June 2015.
To finance the acquisition of the Acquired Interests, and secure working capital and funds for future business
needs, Vistin Pharma will conduct an equity issue of approximately NOK 170 million (the "Offering"), as
further described in section 6.
Initially, the Company has been set up with equity of NOK 1,000,000 with a par value of NOK 1 per share. The
Company's share capital will be reduced by NOK 1,000,000 from NOK 1,000,000 to NOK 0 through
redemption of the 1,000,000 shares in Vistin Pharma ASA that are owned by Weifa, against distribution of
NOK 1,000,000 to Weifa. The share capital reduction will be conducted simultaneous with the share capital
increase related to the Offering. Following the Offering, Weifa ASA will thus have no ownership in the
Company and the investors will have contributed with approximately NOK 170 million of equity to the
Company.
5.2 RATIONALE FOR THE SALE
Before the transfer of the Acquired Interests to Vistin Pharma, Weifa AS consists of two separate business
segments, Consumer Health and B2B. The Consumer Health segment produces (tablets only) and sells branded
finished dose products to consumers in Norway through pharmacies, grocery stores and other OTC channels.
The B2B segment, on the other hand, manufactures and supplies metformin and opioid APIs and tablets to the
global pharmaceutical industry. The two business segments operate independent of each other, although opioid
API produced by the B2B business is used in some of Weifa AS Consumer Health products. As such, the two
business segments are exposed to different market characteristics and have only limited synergies.
The Sale will allow each business to pursue its own strategic agenda, create M&A opportunities for both
companies, increase attention and create a more focused business scope for both companies. It therefore
represents a logical step in creating two companies with distinct and independent investment stories;
- Weifa (Consumer Health) - a pure consumer brand player with leading category positions.
- Vistin Pharma (Acquired Interests) - a strong pharmaceutical investment case with key positions
and growth potential in the international metformin and opioids market, and a strong fundament
to create a highly efficient Contract Manufacturing Organisation (CMO).
Vistin Pharma will, from the start, be a producer of metformin APIs and tablets used in the treatment of diabetes
and opiate APIs and tablets used for pain relief and cough medicine.
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5.3 TRANSFER OF THE ACQUIRED INTERESTS TO THE COMPANY
The Acquired Interests will, subject to comfort on a successful completion of the Offering, be transferred to
Vistin Pharma AS on or about 1 June 2015.
On 17 April 2015 Vistin Pharma AS entered into the BTA, pursuant to which Vistin Pharma AS shall acquire
the Acquired Interests. The BTA defines the Acquired Interests, which includes the following:
i. All properties and buildings owned by Weifa AS, including, but not limited to the properties in
Gruveveien and at Fikkjebakke in Krager
ii. the machinery, hardware, office supplies, inventory and other supplies and equipment related to the
properties and the Acquired Interests
iii. all software, including ERP and financial systems, copyrights, domain names, inventions and other
registered or unregistered intellectual property rights related to the Acquired Interests
iv. all products and their complete documentation as well as regulatory permits, including, but not limited to
Drug Master Files and dossiers
v. all site-related documentation and authorisations, manufacturing licences and other regulatory approvals
related to the Acquired Interests
vi. the employer rights related to the employment of the employees
vii. all right, title and interest in the contracts related to the Acquired Interests
viii. books of accounts (copies), personnel records and other files that relate to the ownership or operation of
the Acquired Interests
ix. all accounts receivables, inventory (excluding finished inventory purchased from third party contract
manufacturers) and other current assets pertaining to the Acquired Interests
The Acquired Interests will include all necessary operational assets and employees for Vistin Pharma AS to
become an independent and fully operational company immediately following the completion of the Sale.
The purchase price for the Acquired Interests shall be NOK 120,000,000, payable on completion of the
Offering. The purchase price of the Acquired Interests has been determined by the Company, together with the
Manager, based on several valuation techniques, among them a comparison of expected earnings multiples versus similar companies and a discounted cash flow analysis.
The completion of the BTA is subject to i.a. the completion (to be determined by the Company when such
completion is unconditional) by Vistin Pharma of an offering of new shares in an amount of at least NOK 170
million, and is expected to be completed on or about 1 June 2015.
The BTA triggers a change of control clause in certain contracts between the Acquired Interests and its
customers and suppliers giving them the opportunity to terminate their existing contract. The Company has been
in continuous dialogue with both customers and suppliers regarding the transfer of existing contracts from Weifa
AS to Vistin Pharma AS and has, as of 8 May 2015, received consent on eight out of 13 customer agreements,
six out of eight supplier agreements and none out of the three distribution/agent agreements. In addition, the
Company has received positive feedback from its dialogue with the remaining customers and suppliers, and
Vistin Pharma expects that all relationships will be maintained. This statement is supported by the fact that the
Acquired Interests will not be subject to any change that will materially impact its customers, suppliers and/or
distribution agreements, and that it will take existing customers 12 - 18 months to establish a new supply
agreement with another pharmaceutical company, which is particularly relevant for the customers who currently
has Weifa AS as their sole supplier. Experience from Aqualis ASAs acquisition of Weifa AS in August 2014
offers support to the Companys assessment, as the transaction triggered the change of control clause in several
of Weifa AS contracts but all customers remained with Weifa AS following the acquisition. In addition, the
customer contracts relevant to the Acquired Interests do not generally include a guaranteed minimum volume,
which allows its customers and suppliers to continuously evaluate alternative suppliers, irrespective of any
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VISTIN PHARMA ASA
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change of control clause. It should also be noted that none of the current contracts, on a stand-alone basis, are
business critical.
The current regulatory approval that is required for sale and import of any raw material necessary for producing
medicinal products at the premises located at Fikkjebakke and Gruveveien are currently held by Weifa AS and
cannot be directly transferred to Vistin Pharma. This includes a manufacturing license, including the right to sell
and import medicinal products, a certificate of good manufacturing practice (GMP) and a certificate of good
distribution practice (GDP). Vistin Pharma AS manufacturing license for the Acquired Interests has already
been issued and will be valid from 1 June 2015 until 1 June 2020. The GMP and GDP certificates have not been
renewed and will require renewal following the acquisition of the Acquired Interests. The Gruveveien facility
was re-inspected by the Norwegian Medicines Agency (NoMA) in May 2015 and a new certificate issued to
Vistin Pharma AS is expected shortly after the acquisition. The Company expects that the Fikkjebakke facility
will be re-inspected in late 2015 or early 2016 and that a new license will be issued shortly after. The risk
associated with the renewal of the certificates is considered to be minimal, as the manufacturing facilities will be
unaffected by the transaction. In addition, the Company expects that it will be able to operate under the
certificates issued to Weifa AS until new ones have been approved for Vistin Pharma AS. The transfer should
therefore have a limited impact on the continuing operations of the Company.
5.4 APPLICATION FOR ADMISSION TO TRADING OF THE COMPANYS SHARES
Vistin Pharma ASA applied for admission to trading of its Shares on Oslo Axess on 23 April 2015. It is
expected that the board of directors of the Oslo Stock Exchange approves the listing application of Vistin
Pharma ASA on or about 26 May 2015, subject to certain conditions being met. Listing of the Company is
expected to be conditional upon the following:
- Prior to the first day of listing, the requirement for the number of shareholders as stipulated in Oslo Axess Listing Rules, section 2.4.2, is fulfilled;
- At least 25% of the shares to be listed are held by the general public as required by the Oslo Axess Listing Rules, section 2.4.1;
- That the Company raises at least NOK 170 million in new equity through the contemplated Offering; and
- Completes the Sale and Offering as planned
Vistin Pharma ASA currently expects commencement of trading in the Shares on Oslo Axess on or about 10
June 2015. The Shares will be listed under the ticker symbol "VISTIN".
5.5 VISTIN PHARMAS RELATIONSHIP WITH WEIFA FOLLOWING THE SALE
Weifas key brands within the consumer health pain segment Paracet, Ibux and Paralgin Forte, are currently
being produced at the manufacturing facility at Gruveveien, Krager, Norway. The manufacturing facility at
Gruveveien is a part of the Acquired Interests, and will thus be transferred to the Company in connection with
the Sale.
On 17 April 2015 Vistin Pharma AS entered into a five year exclusive contract manufacturing agreement (the
CMO Agreement) with Weifa AS for the production of all tablets currently produced internally by Weifa AS
for the sale through its Consumer Health segment (i.e. Ibux, Paracet, Paralgin Forte, Metformin) and certain
products to third parties in which Weifa AS has the exclusive right to sell within certain geographical areas (i.e.
metformin, strong pain killers). The contract includes an option to extend the agreement for another two years.
Neither party can fully or partially terminate the contract within the initial five year period, unless the other
party