Rapala VMC Corporation, Inside Information, November 16, 2023 at 9.45 a.m. EET

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, HONG KONG, JAPAN, NEW ZEALAND, SINGAPORE, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

Rapala VMC Corporation (“Rapala VMC”) considers the issuance of euro-denominated hybrid capital securities in the aggregate amount of up to EUR 25 million (the “Capital Securities”). The issuance of the Capital Securities may take place in the near future subject to market conditions. Rapala VMC would use the proceeds from the contemplated issue of the Capital Securities for general corporate purposes, including supporting its balance sheet and cash balance as well as improving its financial flexibility amid challenging trading environment while implementing savings program in operating expenses and optimizing its inventories. The contemplated issuance of the Capital Securities would also diversify Rapala VMC’s financing sources to capital markets.

The Capital Securities are subordinated to the company's other debt obligations and treated as equity in Rapala VMC’s consolidated financial statements prepared in accordance with the IFRS. The Capital Securities do not confer to its holders the rights of a shareholder and do not dilute the holdings of the current shareholders.

Rapala VMC’s largest shareholder, Viellard Migeon Et Compagnie Sa, has committed to participate in the potential issue by subscribing for the Capital Securities in an amount of EUR 10 million.

In connection with the contemplated issuance of the Capital Securities, Rapala VMC has agreed on key terms of and executed a mandate letter and a term sheet regarding EUR 106,000,000 senior secured term and revolving facilities (the “Facilities”) with OP Corporate Bank plc, Skandinaviska Enskilda Banken AB (publ) and Nordea Bank Abp as underwriters of the Facilities (the “Lenders”) for the purposes of refinancing Rapala VMC’s existing loan facilities with the Lenders and for general corporate purposes (the “Refinancing”). The term of the Facilities is fifteen (15) months from the signing of the facilities agreement relating to the Refinancing, subject to two extension options of twelve (12) months each.

Pursuant to the key terms of the Refinancing agreed upon with the Lenders, the completion of the issuance of the Capital Securities is a precondition for the Refinancing. The facilities agreement relating to the Refinancing is intended to be executed on or about the completion of the issue of the Capital Securities.

The terms of the Refinancing include financial covenants based on the leverage ratio, the ratio of net debt/consolidated equity, the available liquidity, the absolute net debt and the absolute EBITDA. Financial covenants shall be regularly tested either quarterly or on the last date of each month. Furthermore, if the general meeting of Rapala VMC make a decision on payment of any dividends or other equity distributions to its shareholders, the covenant level for leverage ratio shall be adjusted for the remaining loan term.

Nordea Bank Abp and OP Corporate Bank plc have been appointed to act as joint lead managers in the potential issue of the Capital Securities.

OP Corporate Bank plc, Skandinaviska Enskilda Banken AB (publ) and Nordea Bank Abp have been appointed as mandated lead arrangers and bookrunners for the Refinancing.

Additional Information

For additional information, please contact:

Lars Ollberg, President and Chief Executive Officer,
Jean-Philippe Nicolle, Chief Financial Officer, or
Tuomo Leino, Investor Relations

tel. +358 9 7562 540

Important Information

The information contained herein is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States, Australia, Canada, Hong Kong, Japan, New Zealand, Singapore, South Africa or such other countries or otherwise in such circumstances in which the release, publication or distribution would be unlawful. The information contained herein does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, the Capital Securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. No actions have been taken to register or qualify the Capital Securities, or otherwise to permit a public offering of the Capital Securities, in any jurisdiction.

This communication does not constitute an offer of the Capital Securities for sale in the United States. The Capital Securities have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”) or under the applicable securities laws of any state of the United States, and the Capital Securities may not be offered, sold, pledged or otherwise transferred, directly or indirectly, within the United States or to, or for the account or benefit of, any U.S. person (as such terms are defined in Regulation S under the Securities Act) except pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

This communication does not constitute an offer of the Capital Securities to the public in the United Kingdom. No information memorandum has been or will be approved in the United Kingdom in respect of the Capital Securities. Consequently, this communication is addressed to and directed only at persons in the United Kingdom in circumstances where provisions of section 21(1) of the Financial Services and Markets Act 2000 as amended, do not apply and are solely directed at persons in the United Kingdom who (i) have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”), (ii) are persons falling within Article 49(2)(a) to (d) of the Order, or (iii) are other persons to whom it may be otherwise lawfully communicated (all such persons together being referred to as “relevant persons”). This release is directed only at relevant persons and any person who is not a relevant person must not act or rely on this release or any of its contents.

About Rapala VMC Corporation

Rapala VMC group is the world’s leading fishing tackle company and the global market leader in fishing lures, treble hooks and fishing related knives and tools. The group also has a strong global position in other fishing categories and Rapala VMC’s distribution network is largest in the fishing industry. The main manufacturing facilities are in Finland, France, Estonia, and the UK. Rapala VMC group’s brand portfolio includes the leading brand in the industry, Rapala, and other global brands like VMC, Sufix, Storm, Blue Fox, Luhr Jensen, Williamson, Dynamite Baits, Mora Ice, StrikeMaster, Marttiini, Peltonen and 13 Fishing as well as Okuma in Europe. The group, with net sales of EUR 274 million in 2022, employs some 1 500 people in approximately 40 countries. Rapala VMC Corporation’s share is listed and traded on the Nasdaq Helsinki stock exchange since 1998.

www.rapalavmc.com