Ratos sells Stofa to SE


Ratos has signed an agreement to sell all the shares in the subsidiary Stofa to
the Danish energy and telecom group SE (Syd Energi) for DKK 1,900m (enterprise
value). The sale generates a net exit gain for Ratos of approximately SEK 850m
and an average annual return (IRR) of approximately 55%. The sale is subject to
approval from the relevant regulatory authorities and SE's Board of
Stofa is a Danish operator within broadband, cable TV and telephony which provides some 375,000 Danish households with cable TV and almost 200,000 with broadband. The services are delivered in close co-operation with 300 antenna associations throughout Denmark. Stofa also sells to end-user subscribers who are offered interactive TV services (pay TV), broadband and IP telephony.
Ratos acquired Stofa in summer 2010 and the company has since then focused its strategy and implemented major changes in order to sharpen efficiency, customer offerings and competitiveness. Stofa is now increasing the number of broadband customers and selling more products to existing customers which will further strengthen profitability and growth. Major investments have also been made in both infrastructure and marketing. In addition, part of Canal Digital's Danish cable TV business has been acquired. Today, Stofa is market-oriented, efficient and a clear challenger to TDC/YouSee. Sales have risen from DKK 1,024m in 2009 to DKK 1,146m in 2011 and during the same period operating profit has risen from DKK 92m to DKK 146m. The number of broadband customers has increased by more than 10% during 2012.
Ratos's CEO, Susanna Campbell, comments: "Stofa is a fine and well-invested company which we would have gladly owned for a few more years since we have not yet shown its full potential. The many measures and investments carried out are expected to provide good earnings development in the years ahead. But since our discussions with SE, which is a very logical buyer, have resulted in them wishing to buy at a price which takes the company's position and prospects into account, we have agreed to sell."
The selling price for 100% of the shares (equity value) amounts to approximately DKK 1,002m and the enterprise value amounts to DKK 1,900m. Ratos's share of the equity value is approximately DKK 991m and the net exit gain amounts to approximately SEK 850m, calculated on the book value of Ratos's holding in Stofa at 30 June 2012. The final exit gain will be affected, among other things, by Ratos's share in Stofa's profits during the period until final implementation of the deal. Average annual return (IRR) amounts to approximately 55% (61% in DKK). Ratos's holding in Stofa is 99%.
SE is a Danish energy and telecom group, which offers services within energy, internet, TV and telephony. The company has some 700 employees and sales in 2011 totalled DKK 2.9 billion.
The sale is subject to approval from the relevant regulatory authorities and SE's Board of Representatives. The Board of Representatives will be convened on 13 November. The deal is expected to be completed by year-end 2012 at the earliest.
For further information, please contact: Susanna Campbell, CEO Ratos, +46 8 700 17 00 Emma Rheborg, Head of Corporate Communications and IR Ratos, +46 8 700 17 20
Financial calendar from Ratos:
Interim Report January - September 2012 9 November 2012
Year-end report 2012 15 February 2013
Annual General Meeting 2013 17 April 2013

Ratos is a private equity conglomerate. The company's mission is to maximise shareholder value over time through the professional, active and responsible exercise of its ownership role in primarily medium to large unlisted Nordic companies. Ratos's holdings include AH Industries, Arcus-Gruppen, Biolin Scientific, Bisnode, Contex Group, DIAB, Euromaint, Finnkino, GS-Hydro, Hafa Bathroom Group, HL Display, Inwido, Jøtul, KVD Kvarndammen, Mobile Climate Control, SB Seating and Stofa. Ratos is listed on Nasdaq OMX Stockholm and market capitalisation amounts to approximately SEK 17 billion.