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Invitation for submitting expression of interest - Acquisition of 100 % equity interest in Mariborska livarna Maribor, d. d. (Non-binding Expression of Interest)

Slovenian Sovereign Holding (hereinafter referred to as: “SSH”) is the sole owner of Mariborska livarna Maribor, d. d. (hereinafter referred to as: “MLM” or “the Company”) and its largest creditor. As of 31 December 2023, SSH holds a substantial receivable of EUR 13.7 million from MLM. These receivables are secured by a mortgage on MLMs immovable property and a pledge on most of MLM's equipment, inventories, and trade receivables.

Through this invitation, SSH seeks to assess public and potential investor interest in acquiring 100% equity interest in MLM (hereinafter referred to as: the ”MLM Transaction”) under the following baseline terms:

1. The Purchaser will infuse additional financial resources into MLM through a capital increase or long-term financial loan to MLM or other suitable means to facilitate the company's ongoing operations and growth.
2. SSH will sell its equity interest in MLM for EUR 1.00.
3. If desired by the Purchaser, SSH may opt to purchase the property in Maribor, Slovenia, currently housing the Company, at an estimated market value of EUR 10,9 million, with part of MLM's receivables offset against the purchase price. If desired by the Purchaser, SSH may lease the property to MLM for a maximum of 10 years at an annual lease rate of EUR 1.1 million. The Lessee will be responsible to pay all associated property costs for the entire lease period, including current and investment maintenance costs, insurance, fee for the use of building land, etc.). Additionally, by no later than 31 December of each year, the Lessee is required to submit to the Lessor a capital works plan for the following accounting period, subject to written approval by the Lessor. The Purchaser of MLM will be required to provide to SSH an adequate guarantee for the payment of one year's lease rate.
4. SSH is prepared to restructure all outstanding receivables from MLM into a maximum 10-year financial loan, offering an 8% interest rate and a two-year moratorium on principal repayment. This is subject to unchanged collateral conditions or alternative collateral of equivalent quality provided by the Purchaser. Early repayment of the receivables is permissible at no additional cost.
5. SSH cannot increase capital in MLM, extend further loans, write off receivables, or otherwise increase its financial exposure to MLM, or worsen its position as a creditor. Moreover, neither SSH nor the Republic of Slovenia can provide any additional grants to MLM in any form, as this would constitute unlawful State aid because MLM has already received non-refundable State aid within the period of the last 10 years. State aid encompasses not only direct grants but also any transaction which a private investor would not undertake, such as writing off secured receivables or providing non-market term leases or loans, and similar transactions. Expressions of Interest containing such elements will be deemed inappropriate.

 

All prospective investors are invited to provide us with a written expression of their interest in a transaction involving MLM (hereinafter referred to as:  the “Expression of Interest”). The Expression of Interest should include the following details:

1. Subject of the Expression of Interest: Acquisition of 100% equity interest in MLM;
2. Information about the interested party: Name, exact address, registration number and tax number, and contact details;
3. Offered price: which is to be determined in accordance with point 2;
4. Amount of additional financial resources to be provided by the interested party and the proposed method of contribution to the Company (capital increase, financial loan, etc.).
5. Details regarding the MLM property in Maribor, Slovenia:
   1. Whether the interested party wishes SSH to acquire MLM property under the terms specified in point 3.
   2. Whether the interested party wishes SSH to lease the acquired property to MLM according to the terms outlined in point 3, and what security will be provided to ensure the payment of one year's lease rate.
6. Whether MLM's outstanding liabilities to SSH will be repaid immediately, or if the interested party prefers SSH to restructure them as outlined in point 4, along with proposed security arrangements (existing or replacement).
7. Information about the job retention plan and any commitments regarding this matter that the interested investor would be willing to make.

 

The Expressions of Interest must be submitted in writing to the following SSH’s email address:mlm.interes@sdh.si  with the subject line “EXPRESSION OF INTEREST FOR MLM TRANSACTION”.

 

This invitation serves to assess the interest of potential investors in acquiring MLM Shares and providing additional funds to MLM. SSH is not obligated to accept any offer or enter into a contract for the sale of the MLM Shares or other transaction documents with any potential investor based on this invitation. SSH's decision not to accept an Expression of Interest shall not incur any liability, including liability for damages, on the part of SSH under this Invitation.