Rec Silicon raises up to one billion in new capital

It appears in a stock exchange announcement from the company on Wednesday afternoon. There has been intense interest in the company, which on Wednesday was the most traded on the Oslo Stock Exchange.

Kjell Inge Røkke-controlled silicon producer Rec Silicon through its Aker Group and the wholly owned investment company Aker Capital. The share has in recent days experienced a sharp rise on the Oslo Stock Exchange, and after the stock exchange closed on Wednesday, Rec Silicon announced that it will raise up to one billion kroner in new capital through the issue of shares.

Kjell Inge Røkkes Aker Capital guarantees NOK 300 million in the capital increase, while DNB-fond guarantees NOK 150 million.

The fresh capital is needed by the company to expand its operations at its facilities in Butte and Moses Lake, as well as for general corporate purposes, according to a stock exchange announcement on Wednesday afternoon.

The company also writes in the announcement that it aims to place the capital raising among investors by 08:00 on Thursday morning. The capital increase is divided into two parts, as the current share issue authorization from the shareholders at the previous general meeting is not large enough. A new general meeting is therefore planned in November to approve the second part of the capital increase.

The Rec Silicon board also writes in the report that it will consider making a so-called repair issue. It is a capital increase where those of the current shareholders in the company who do not have the opportunity to subscribe for the directed capital increase, can subscribe to maintain all or part of their ownership interest in the company.

The Rec Silicon share has almost tripled since the beginning of October. On Wednesday, the REC share was traded for NOK 11.90. The company’s market value is 3.2 billion.

The brokerages Arctic Securities and Pareto Securities are facilitators of the capital increase, which is done as a so-called book building, where the brokerages solder the interest among potential investors and then allocate the shares.

The subscription price is often also determined in this part of the process, but Rec Silicon has already decided that the subscription price will be NOK 10.80, slightly below Wednesday’s closing price on the Oslo Stock Exchange of NOK 11.38.

Cooperation agreement

On Tuesday, it was announced that the silicon manufacturer has entered into agreements with the companies Violet Power and Group14 Technologies. So far this year, the Rec Silicon share has risen more than 300 percent, of which 216 percent in the last three weeks.

The agreement with Group14 Technologies is based on the development of a full-scale production facility at Rec’s current facility at Moses Lake. Here, they expect to produce 12,000 tonnes of silicon products annually for battery use in 2023.

Rec writes in the report that they have now secured liquidity that makes it possible to prepare a decision and financing of the start-up of the Moses Lake factory through the second half of 2021.

“It is the goal of such a start-up in 2022 after continued positive development in both the solar and battery markets, where the company believes it is well positioned to become a leading American producer of silane and super-pure silicon,” the report states.

Gold investment for Røkke

In December last year, it became known that the investor Jens Ulltveit-Moe had sold his 64.2 million shares in Rec Silicon to Røkkes Aker Capital for a sum of NOK 85 million. The same record is currently up more than 430 percent. After the stock exchange closed on Wednesday, Aker Capital’s shareholding was worth more than NOK 730 million.

Other shareholders with large holdings in Rec Silicon include Ketil Skorstad through Tigerstaden as and Jakob Hatteland.

On Wednesday morning, it was announced that Rec Silicon partner Group 14 Technologies also plans to raise capital to finance the facility on Moses Lake.

Loss in second quarter

The company’s report for the second quarter of the year showed a deficit of NOK 368 million, and write – downs in the hundreds of millions. Net debt had also increased to NOK 1.6 billion.

– I am satisfied with the financial and operational result of our semiconductor business at the Butte factory despite corona challenges. Delays in the introduction of the Phase 1 trade agreement with China are currently continuing to delay the restart of the factory in Moses Lake, Rec CEO Tore Torvund said in a stock exchange announcement in connection with the results.

According to the company, the miserable figures were a result of low demand due to the corona crisis, which in turn had led to increased liquidity risk. (Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases using a link, which leads directly to our pages. Copying or other form of use of all or part of the content, can only take place with written permission or as permitted by law. For further terms see here.