THIS ANNOUNCEMENT RELATES TO THE DISCLOSURE OF INFORMATION THAT QUALIFIED OR MAY HAVE QUALIFIED AS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION DIRECTLY OR INDIRECTLY IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES, ITS TERRITORIES AND POSSESSIONS (INCLUDING PUERTO RICO, THE U.S. VIRGIN ISLANDS, GUAM, AMERICAN SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA ISLANDS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA) OR ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO RELEASE, PUBLISH, OR DISTRIBUTE THIS DOCUMENT, OR TO ANY U.S. PERSON (AS DEFINED IN REGULATION S UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED) (SEE "SOLICITATION AND DISTRIBUTION RESTRICTIONS" BELOW).
DANSKE BANK OYJ*
(incorporated with limited liability in Finland)
announces consent solicitations in respect of its outstanding
EUR1,000,000,000 1.625 per cent. Covered Bonds due 2019 (originally issued by Sampo Bank plc)
(the “2019 Covered Bonds”)
EUR1,000,000,000 0.25 per cent. Covered Bonds due 2020
(the “2020 Covered Bonds”)
EUR1,000,000,000 3.875 per cent. Covered Bonds due 2021 (originally issued by Sampo Housing Loan Bank plc)
(the “2021 Covered Bonds”)
(each a “Series” and, together, the “Covered Bonds”)
2 May 2017. Danske Bank Oyj* (the “Issuer”) announces today separate invitations (each such invitation in respect of a Series, a “Consent Solicitation”) to Eligible Covered Bondholders (as defined below) to (i) consent to certain modifications to the terms and conditions of, and related documents for, the relevant Series to reflect the substitution of Danske Mortgage Bank Plc** (the “New Issuer”) in place of the Issuer as issuer and principal debtor in respect of the relevant Series and the provision of a guarantee from the Issuer (together, the “Proposed Amendments”) and (ii) agree to release and waive all rights, claims, actions or entitlements arising under Finnish law (including, without limitation, the right to object to the Demerger (as described below)) against each of the Issuer, the New Issuer and Danske Bank A/S in respect of the Demerger, all as proposed by the Issuer for approval by an extraordinary resolution (an “Extraordinary Resolution”) at a meeting of the holders of such Series (each a “Meeting” and together the “Meetings”), as further described in the Consent Solicitation Memorandum prepared by the Issuer dated 2 May 2017 (the “Consent Solicitation Memorandum”).
The Consent Solicitations are being made on the terms and subject to the conditions contained in the Consent Solicitation Memorandum and this announcement should be read in conjunction with the Consent Solicitation Memorandum. Capitalised terms used but not otherwise defined in this announcement have the meanings given in the Consent Solicitation Memorandum. Copies of the Consent Solicitation Memorandum are (subject to distribution restrictions) available from the Tabulation Agent as set out below.
Background to the Proposed Amendments
As part of its efforts to simplify the organisation and improve efficiency, Danske Bank Group is planning to merge its activities in Finland, which currently consist of the Issuer and Danske Bank A/S, Helsinki Branch, into a single branch. In doing so, Danske Bank Group will achieve a uniform organisational structure across the Nordic markets. This will be pursued as a cross-border merger under the Cross Border Mergers Directive (2005/56/EC) as implemented in Denmark and Finland. Under the Cross-Border Merger, the Issuer will be dissolved and will cease to exist.
Prior to the Cross-Border Merger, the Issuer intends to (i) conduct the Demerger by way of a partial demerger so that its mortgage credit banking business, together with its existing Covered Bonds and the collateral relating thereto, shall be transferred to the New Issuer, which is to be incorporated at the time of the Demerger, and (ii) enter into each Deed Poll, the Supplemental Trust Deed and each Guarantee, all as described herein, in order to preserve the existing Covered Bonds' status as covered bonds under the MCBA.
In anticipation of the contemplated Cross-Border Merger, the Issuer has announced the Demerger and has signed the Demerger Plan on 23 March 2017. The Demerger Plan was registered with the Trade Register by the Registrar on 7 April 2017. The Issuer also filed a notice to execute the Demerger with the FIN-FSA on 24 March 2017. Copies of the Demerger Plan and the Articles of Association of the New Issuer are available from the Tabulation Agent, contact details for which appear below. The Demerger is expected to be implemented on 1 October 2017, although Covered Bondholders should note that the Demerger is subject to Finnish law and timeframes for implementation.
The Issuer and the Parent have taken, in their opinion, necessary steps to ensure that the interests of Covered Bondholders are adequately protected post the implementation of the Demerger and the completion of the Cross-Border Merger, via the execution of each Deed Poll and the Supplemental Trust Deed, as well as each Guarantee. The Covered Bonds are expected to continue to be recognised as eligible collateral for monetary policy operations of the central banking system for the euro (the “Eurosystem”) and intra-day credit operations by the Eurosystem.
The Issuer is undertaking the Consent Solicitations to receive confirmation from Covered Bondholders that they support the Demerger and the Proposed Amendments and thereby to remove any unforeseen legal uncertainties for existing stakeholders including the Covered Bondholders. However, Covered Bondholders should note that it is the intention of the Issuer to consummate a process which achieves substantially the same result as the Demerger (and the proposed subsequent Cross-Border Merger) irrespective of the outcome of the Consent Solicitations, and which may be achieved without any consent of Covered Bondholders and would not constitute a default under the terms of the Covered Bonds (nor would the subsequent Cross-Border Merger).
There is no inter-conditionality between the Extraordinary Resolutions in respect of any Series of Covered Bonds.
Eligible Covered Bondholders
The Consent Solicitations are only being made, and the Consent Solicitation Memorandum and any other documents or materials relating to the Consent Solicitations are only for distribution or to be made available to a person that is (a) located and resident outside the United States and not a U.S. person (as defined in Regulation S under the United States Securities Act of 1933, as amended) and (b) otherwise a person to whom the relevant Consent Solicitation can be lawfully made and that may lawfully participate in the relevant Consent Solicitation (all such persons, “Eligible Covered Bondholders”).
At each Meeting, Covered Bondholders of the relevant Series will be invited to consider and, if thought fit, pass the relevant Extraordinary Resolution to approve the implementation of the Proposed Amendments in respect of the relevant Series, as more fully described in the Consent Solicitation Memorandum and the notice convening the Meetings published by the Issuer on or around the date of this announcement (the “Notice”).
The implementation of each Consent Solicitation and the related Extraordinary Resolution will be conditional on:
(a) the passing of the relevant Extraordinary Resolution; and
(b) the quorum required for, and the requisite majority of votes cast at, the relevant Meeting being satisfied by Eligible Bondholders, irrespective of any participation at the relevant Meeting by Covered Bondholders who are not Eligible Covered Bondholders (all such persons, “Ineligible Bondholders”), as further described in the Consent Solicitation Memorandum,
(together, the “Consent Conditions”).
The quorum required for each Meeting to consider the relevant Extraordinary Resolution is (i) in respect of the 2019 Covered Bonds and the 2020 Covered Bonds, one or more persons present and holding or representing in aggregate not less than 50 per cent. in nominal amount of the relevant Series for the time being outstanding and (ii) in respect of the 2021 Covered Bonds, one or more persons present and holding or representing in aggregate not less than three-quarters in nominal amount of the 2021 Covered Bonds for the time being outstanding.
In the event the necessary quorum for any Extraordinary Resolution for any reason is not obtained, the relevant Meeting will be adjourned, as further described in the Consent Solicitation Memorandum. The quorum for any adjourned Meeting is (i) in respect of the 2019 Covered Bonds and the 2020 Covered Bonds, one or more persons present and holding or representing Covered Bonds of the relevant Series for the time being outstanding (whatever the nominal amount of the Covered Bonds so held or represented by them) and (ii) in respect of the 2021 Covered Bonds, one or more persons present and holding or representing in aggregate not less than a clear majority in nominal amount of the 2021 Covered Bonds for the time being outstanding.
To be passed at the relevant Meeting (including any adjourned such Meeting), an Extraordinary Resolution requires a majority in favour consisting of not less than 75 per cent. of the votes cast at such Meeting. If passed, an Extraordinary Resolution shall be binding on all Covered Bondholders of the relevant Series, whether present or not at the relevant Meeting and whether or not voting.
Early Participation Fee
In respect of each Series, the Issuer will pay to each Eligible Covered Bondholder from whom a valid Consent Instruction in favour of the relevant Extraordinary Resolution is received by the Tabulation Agent by 5.00 p.m. (CET) on 18 May 2017 (such time and date with respect to each Series, as the same may be extended, the “Early Instruction Deadline”), an amount equal to 0.10 per cent. of the nominal amount of the Covered Bonds that are the subject of such Consent Instruction (the “Early Participation Fee”), subject to the satisfaction of the Consent Conditions, and as otherwise set out in the Consent Solicitation Memorandum.
To be eligible to receive the Early Participation Fee, each Covered Bondholder who submits a Consent Instruction must not attend, or seek to attend, the relevant Meeting in person or make any other arrangements to be represented at the relevant Meeting (other than by way of its Consent Instructions). Covered Bondholders may choose to attend and vote at the relevant Meeting in person or to make other arrangements to be represented or to vote at the relevant Meeting, however, any such Covered Bondholder will not be eligible to receive the Early Participation Fee in respect of such Covered Bonds, irrespective of whether such Covered Bondholder has also delivered a Consent Instruction or such other arrangements are made by the Early Instruction Deadline.
Where payable, the Early Participation Fee will be paid to the Covered Bondholder, or (if applicable) the Direct Participant acting on behalf of the relevant Covered Bondholder who was the holder of the relevant Covered Bonds on the date on which the relevant Extraordinary Resolution was passed,. In the event that any such Covered Bondholder sells or transfers its Covered Bonds between the date on which the relevant Extraordinary Resolution was passed and the payment of the Early Participation Fee, the entitlement to the Early Participation Fee will not be transferred with the relevant Covered Bonds.
Ineligible Covered Bondholder
An Ineligible Covered Bondholder may be eligible, to the extent permitted by applicable laws and regulations, to receive an equivalent amount to any applicable Early Participation Fee (which is an amount equal to 0.10 per cent. of the nominal amount of the Covered Bonds that are the subject of a valid Ineligible Holder Instruction that is received by the Tabulation Agent by 5.00 p.m. (CET) on 18 May 2017 and is not subsequently revoked), subject in each case to the relevant Extraordinary Resolution being passed at the relevant Meeting (or any adjourned such Meeting) and the conditions to the relevant Extraordinary Resolution being satisfied, all as more fully described in the Notice.
The indicative timetable is summarised below:
10 Harewood Avenue
London NW1 6AA
Telephone: +44 20 7595 8668
Attention: Liability Management Group
2-12 Holmens Kanal
DK-1092 Copenhagen K
Telephone: +45 45 14 32 33
Attention: 3775 Debt Capital Markets
2 King Edward Street
London EC1A 1 HQ
Telephone: +44 20 7996 5420
Attention: Liability Management Group
Lucid Issuer Services Limited
12 Argyle Walk
London WC1H 8HA
Telephone: +44 20 7704 0880
Attention: Paul Kamminga
The 2021 Covered Bonds Trustee has not been involved with the formulation of the Consent Solicitations, has not reviewed or approved this announcement, the Consent Solicitation Memorandum or the terms of any Consent Solicitation and does not accept any responsibility or liability whatsoever in connection with the Consent Solicitations or any information distributed in connection therewith.
This announcement is released by Danske Bank Oyj and contains information that qualified or may have qualified as inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 (“MAR”), encompassing information relating to the Consent Solicitations and the Proposed Amendments described above. For the purposes of MAR and Article 2 of Commission Implementing Regulation (EU) 2016/1055, this announcement is made by Anu Ilvonen, Head of Communications at Danske Bank Oyj.
DISCLAIMER: This announcement must be read in conjunction with the Consent Solicitation Memorandum. This announcement and the Consent Solicitation Memorandum contain important information which should be read carefully before any decision is made with respect to the Consent Solicitations or any Meeting. If any Covered Bondholder is in any doubt as to the action it should take or is unsure of the impact of the implementation of any Extraordinary Resolution, it is recommended to seek its own financial and legal advice, including in respect of any tax consequences, immediately from its broker, bank manager, solicitor, accountant or other independent financial, tax or legal adviser. Any individual or company whose Covered Bonds are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee or intermediary must contact such entity if it wishes to participate in the relevant Consent Solicitation(s) or otherwise participate in any Meeting. None of the Issuer, the New Issuer, the Parent, the Solicitation Agents, the Tabulation Agent or the 2021 Covered Bonds Trustee expresses any opinion about the terms of the Consent Solicitations or the Extraordinary Resolutions or makes any recommendation as to whether Covered Bondholders should participate in any Consent Solicitation or otherwise participate in any Meeting.
SOLICITATION AND DISTRIBUTION RESTRICTIONS
The Consent Solicitations are only being made outside the United States, to persons other than “U.S. persons” (as defined in Regulation S under the United States Securities Act of 1933, as amended (the “Securities Act”)). Any purported participation in the Consent Solicitations resulting directly or indirectly from a violation of these restrictions will be invalid and any participation in the Consent Solicitations by a person that is located or resident in the United States or that is a U.S. person or by any agent, fiduciary or other intermediary acting on a non-discretionary basis for a beneficial owner that is giving instructions from within the United States or that is any U.S. person will not be accepted.
Neither this announcement nor the Consent Solicitation Memorandum is an offer of securities for sale in the United States or to any U.S. person. Securities may not be offered or sold in the United States absent registration or an exemption from registration. The Covered Bonds, and the proposed guarantee thereof, have not been, and will not be, registered under the Securities Act, or the securities laws of any state or other jurisdiction of the United States, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons, unless an exemption from the registration requirements of the Securities Act is available.
Each Covered Bondholder participating in any Consent Solicitation will represent that it is not a U.S. person (as defined in Regulation S under the Securities Act), and is not acting for the account or benefit of any U.S. person, and that it is not located or resident in the United States.
For the purpose of this announcement and the Consent Solicitation Memorandum, “United States” means the United States of America, its territories and possessions (including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands), any state of the United States of America and the District of Columbia.
Nothing in this announcement or the Consent Solicitation Memorandum constitutes or contemplates an offer of, an offer to purchase or the solicitation of an offer to sell any security in any jurisdiction and participation in the Consent Solicitations by a Covered Bondholder in any circumstances in which such participation is unlawful will not be accepted.
The distribution of this announcement and the Consent Solicitation Memorandum in certain jurisdictions may be restricted by law, and persons into whose possession this announcement or the Consent Solicitation Memorandum comes are requested to inform themselves about, and to observe, any such restrictions.
* parallel legal trade name Danske Bank Plc
** the primary legal trade name in Finnish is Danske Kiinnitysluottopankki Oyj, with parallel legal trade names (i) in English, Danske Mortgage Bank Plc and (ii) in Swedish, Danske Hypoteksbank Abp