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RNS - Inside information: Qt's recommended public cash offer for I.A.R. Systems Group

Company: Qt Group Oyj Date: 2025-07-04 Language: English Register to download
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 Inside information: Qt's recommended public cash offer for I.A.R. Systems Group

# Inside information: Qt's recommended public cash offer for I.A.R. Systems Group

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN AUSTRALIA,
CANADA, HONG KONG, NEW ZEALAND, JAPAN, SINGAPORE, SOUTH AFRICA, SOUTH KOREA,
RUSSIA, BELARUS, OR IN ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION. THIS ANNOUNCEMENT IS NOT AN
OFFER.

Qt Group Plc                        Inside information                4 July
2025 at 8:31 a.m. EEST

Inside information: Qt's recommended public cash offer for I.A.R. Systems Group

Qt Group Plc's ("Qt Group") wholly owned subsidiary The Qt Company Ltd ("The Qt
Company" and together with Qt Group, "Qt") has today announced a recommended
public cash offer to the shareholders of class B shares (the "Shares" or,
individually, a "Share") in I.A.R. Systems Group AB (publ) ("IAR") (the
"Offer").

The offer price is SEK 180 for each IAR Share, valuing IAR at approximately SEK
2,293 million or approximately EUR 204 million\[1\], based on outstanding
Shares.\[2\]

The offer price represents a premium of approximately 63.6 per cent compared to
the volume-weighted average trading price of SEK 110.1 of IAR's Share on Nasdaq
Stockholm during the last three months prior to the announcement of the Offer.

Qt will fund the Offer with a combination of cash and debt.

Juha Varelius, the CEO of Qt Group:

"We have a comprehensive product offering addressing each step of the product
development process and a clear strategy to enhance our position as a multi
-product company, while IAR is a respected provider of embedded development
solutions. By combining Qt Group and IAR, we will expand our total addressable
market, strengthen our global footprint and customer offering while supporting
IAR's transition to a subscription-based business model - a journey we
understand well, having successfully completed it ourselves. We have therefore
placed an attractive offer to the shareholders in IAR that reflects the benefits
we see possible as an integrated part of Qt Group. We are grateful for the
support from the Board of Directors of IAR as well as from shareholders together
representing more than 36 per cent of the shares in IAR."

Strategic rationale for the Offer

In accordance with its strategy, in addition to pursuing organic growth, Qt
Group actively seeks targeted acquisitions. Qt Group has followed IAR's
strategic and operational development closely over a period of time. Qt Group
has a comprehensive product offering addressing each step of the product
development process and a clear strategy to enhance its position as a multi
-product company. To join forces with IAR, with its strength in embedded
development solutions, the combined company would be able to provide a
comprehensive, one-stop shop solution, unlocking significant value for both
companies.

Complementary product portfolios expanding total addressable market: The product
portfolios of Qt Group and IAR are complementary, where Qt Group has deep
expertise in product development of mobile and desktop applications and embedded
devices through every stage of the process, from user interface design to
software development, quality assurance and deployment, whereas IAR has strong
capabilities in embedded development solutions. Furthermore, IAR's commercial
compiler offering would enable Qt Group to enter the sizable broader MCU
(microprocessor) market, which is driven by, among other things, functional
safety requirements. A combination would add value to IAR's current customer
base through extension of offering to Qt Group's Software Quality Solutions,
especially on the functional safety area.

A combination would enable Qt Group and IAR to jointly provide a comprehensive,
one-stop shop solution, fully in line with Qt Group's strategy to enhance its
position as a multi-product company. This would also result in more convenient
purchasing processes and increased developer productivity.

Strengthened global reach and closer customer engagement: IAR and Qt Group
maintain a strong international footprint with a presence across cities
worldwide. By joining forces across sales and customer success functions, the
joint company could establish a stronger market presence in current markets -
positioned to serve global customers with local customer experiences. Together,
the companies would enable a comprehensive offering in the embedded systems
market towards shared MCU customers. This would enable closer engagement and
cooperation with customers earlier in their decision-making processes, thus
improving lead times for Qt Group's solutions.

Support SaaS transition and subscription revenue shift: IAR has initiated a
shift towards a subscription-based model, to allow customers seamless access to
IAR's full product portfolio and service suite. Qt Group believes it can support
and facilitate this transition, leveraging its experience from subscription
-based models to drive long-term growth and customer value.

Information about IAR

IAR is headquartered in Uppsala, Sweden, with a global presence of sales and
support offices strategically located across the world. IAR is listed on Nasdaq
Stockholm, Mid Cap (ticker symbol: IAR B).

IAR provides software and services for embedded development used by companies
worldwide for the creation of secure products. Established in 1983, IAR's
solutions support the development of embedded applications across various
industries including automotive, industrial automation, IoT, MedTech, military,
and public safety. The technology supports 15,000 devices from over 70
semiconductor partners. More information on IAR is available at iar.com.
IAR's consolidated key financials

The information below regarding IAR has been retrieved from the financial
reports prepared and published by IAR. More information on IAR's financials is
available at iar.com.

                        1 January-31 March        1 January-31 December
                         2025         2024         2024            2023
SEK millions, unless
otherwise indicated
Net sales               124.2        119.7        487.2           458.1
EBITDA                   38.6         46.9        174.3           143.6
Adjusted EBITDA          42.0         49.0        186.7           153.1
Operating                25.5         32.1        119.1          -204.1
profit/loss
Adjusted operating       28.8         34.2        131.5            96.1
profit
Earnings per share       1.49         5.12        10.20          -16.84
(basic), SEK
Earnings per share       1.45         5.03         9.98          -16.84
(diluted), SEK
Cash flow from           23.7         32.7        135.4           144.1
operating activities
Gross margin, %          98.0         97.4         97.3            96.6

Total assets            690.5        737.7        724.2           700.0
Equity                  456.4        472.6        462.5           423.4
Total non-current        55.3         57.2         55.2            79.0
liabilities
Total current           178.8        207.9        206.5           197.6
liabilities
Total equity and        690.5        737.7        724.2           700.0
liabilities
Net cash                 97.2        143.9        110.5           145.7
Net debt/equity          -0.2         -0.3         -0.2            -0.3
ratio, multiple
Equity/assets ratio,     66.1         64.1         63.9            60.5
%

Estimated impact of the Offer on Qt Group
Based on Qt Group's and IAR's financial statements for 2024, IAR would have
added approximately EUR 43 million in net sales and approximately EUR 15 million
in EBITDA to Qt Group\[3\].

The cash consideration payable in respect of the Offer is financed in full by a
combination of The Qt Company's own funds and committed debt financing to be
provided by Nordea Bank Abp on terms which are customary for the financing of
public offers on the Swedish market. The Qt Company draws a maximum of EUR 170
million of new interest-bearing debt for the financing of the Offer.

Recommendation by the IAR Board, shareholder support, and further information on
the Offer

The Offer is unanimously recommended by the Board of Directors of IAR.
Shareholders representing approximately 25.8 per cent of the outstanding\[4\]
number of Shares have irrevocably undertaken to accept the Offer and
shareholders representing approximately 10.9 per cent of the outstanding number
of Shares have confirmed their support for and are intending to accept the
Offer.

The completion of the Offer is conditional, among other conditions, upon the
receipt of all regulatory, governmental or similar clearances, approvals and
decisions and acceptance by shareholders holding more than 90 per cent of the
shares in IAR on a fully diluted basis. The Qt Company has reserved the right to
waive, in whole or in part, one or more of the conditions.

The Offer acceptance period is expected to run between 18 August 2025 and 25
September 2025. As set out above, the completion of the Offer is conditional
upon, inter alia, the receipt of all regulatory, governmental or similar
clearances, approvals and decisions that are necessary for the Offer and the
acquisition of IAR.

The Qt Company's intention is to acquire (through the Offer or otherwise) Shares
resulting in The Qt Company holding more than 90 per cent of the total number of
shares in IAR, and to commence compulsory redemption proceedings under the
Swedish Companies Act to acquire all remaining shares in IAR and to promote the
delisting of IAR's Shares from Nasdaq Stockholm.

Information about the Offer is made available at www.nordic-software-offer.com.

Invitation to investor and analyst briefing

Qt will organise an investor and analyst briefing on 4 July 2025 at 11-12 am
(EEST) where CEO Juha Varelius and CFO Jouni Lintunen will be presenting the
offer announcement followed by Q&A session. You can register to the webcast at
https://inderes.videosync.fi/july-2025-investorupdate.

You can ask questions during the Q&A session via conference call. Register for
the teleconference through the below link, and you will be given phone numbers
and conference ID to access the call:
https://palvelu.flik.fi/teleconference/?id=5008727. If you wish to ask a
question, dial \*5 on your telephone keypad to enter the queue.

Advisors

Qt has appointed Nordea Bank Abp as lead financial advisor and Stifel Nicolaus
Europe Limited as financial advisor. Krogerus Attorneys, Advokatfirman Vinge and
Freshfields LLP are acting as legal advisors in connection with the Offer.

Investor relations contact:

pr@qt.io

Media contact:

Sandra Uitto, Fogel & Partners

Tel.: +46 (0)73 892 1740

E-Mail: qtgroup@fogelpartners.se

Distribution:

Nasdaq Helsinki

Key media

www.qt.io

Important information

This stock exchange release does not constitute an offer to buy or sell Shares,
nor does it constitute an invitation to offer to buy or sell Shares. Investors
considering tendering their Shares in the Offer by Qt Group's subsidiary The Qt
Company should rely only on information disclosed by The Qt Company as the
offeror of the Offer.

The Offer is not being made to persons whose participation in the Offer requires
that an additional offer document be prepared or registration effected or that
any other measures be taken in addition to those required under Swedish law.

The Offer is not being made, directly or indirectly, in or into Australia,
Canada, Hong Kong, New Zealand, Japan, Singapore, South Africa, South Korea,
Russia, Belarus or in any other jurisdiction where such offer would be
prohibited by applicable law pursuant to legislation, restrictions and
regulations in the relevant jurisdiction, by use of mail or any other
communication means or instrumentality (including, without limitation, facsimile
transmission, electronic mail, telex, telephone and the Internet) of interstate
or foreign commerce, or of any facility of national securities exchange or other
trading venue, of Australia, Canada, Hong Kong, New Zealand, Japan, Singapore,
South Africa, South Korea, Russia, Belarus or in any other jurisdiction where
such offer would be prohibited by applicable law pursuant to legislation,
restrictions and regulations in the relevant jurisdiction, and the Offer cannot
be accepted by any such use or by such means, instrumentality or facility of, in
or from, Australia, Canada, Hong Kong, New Zealand, Japan, Singapore, South
Africa, South Korea, Russia, Belarus or in any other jurisdiction where such
offer would be prohibited by applicable law pursuant to legislation,
restrictions and regulations in the relevant jurisdiction. Accordingly, any
documentation relating to the Offer are not being and should not be sent, mailed
or otherwise distributed or forwarded in or into Australia, Canada, Hong Kong,
New Zealand, Japan, Singapore, South Africa, South Korea, Russia, Belarus or in
any other jurisdiction where such offer would be prohibited by applicable law
pursuant to legislation, restrictions and regulations in the relevant
jurisdiction.

The Offer, the information and documents relating to the Offer are not being
made and have not been approved by an authorised person for the purposes of
section 21 of the UK Financial Services and Markets Act 2000 (the "FSMA"). The
communication of the information and documents relating to the Offer are exempt
from the restriction on financial promotions under section 21 of the FSMA on the
basis that they are a communication by or on behalf of a body corporate which
relates to a transaction to acquire day to day control of the affairs of a body
corporate; or to acquire 50 per cent or more of the voting shares in a body
corporate, within article 62 of the UK Financial Services and Markets Act 2000
(Financial Promotion) Order 2005.

Statements in this stock exchange release relating to future status or
circumstances, including statements regarding future performance, growth and
other trend projections and the other benefits of the Offer, are forward-looking
statements. These statements may generally, but not always, be identified by the
use of words such as "anticipates", "intends", "expects", "believes", or similar
expressions. By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend on circumstances that will
occur in the future. There can be no assurance that actual results will not
differ materially from those expressed or implied by these forward-looking
statements due to many factors, many of which are outside the control of Qt
Group. Any such forward-looking statements speak only as of the date on which
they are made, and Qt Group has no obligation (and undertakes no such
obligation) to update or revise any of them, whether as a result of new
information, future events or otherwise, except for in accordance with
applicable laws and regulations.

Information for shareholders in the United States

The Offer by The Qt Company described in this stock exchange release is not made
by Qt Group and, as made by The Qt Company, is made for the issued and
outstanding shares of IAR, a company incorporated under Swedish law, and is
subject to Swedish disclosure and procedural requirements, which may be
different from those of the United States. The Offer is made in the United
States pursuant to Section 14(e) of the U.S. Securities Exchange Act of 1934, as
amended (the "U.S. Exchange Act") and Regulation 14E thereunder, to the extent
applicable and otherwise in compliance with the disclosure and procedural
requirements of Swedish law, including with respect to withdrawal rights, the
Offer timetable, notices of extensions, announcements of results, settlement
procedures (including as regards to the time when payment of the consideration
is rendered) and waivers of conditions, which may be different from requirements
or customary practices in relation to U.S. domestic tender offers. The Qt
Company's ability to waive the conditions to the Offer (both during and after
the end of the acceptance period) and the shareholders' ability to withdraw
their acceptances, are not the same under a tender offer governed by Swedish law
as under a tender offer governed by U.S. law. Holders of the shares in IAR
domiciled in the United States (the "U.S. Holders") are encouraged to consult
with their own advisors regarding the Offer.

IAR's financial statements and all financial information included herein, or any
other documents relating to the Offer, have been or will be prepared in
accordance with IFRS and may not be comparable to the financial statements or
financial information of companies in the United States or other companies whose
financial statements are prepared in accordance with U.S. generally accepted
accounting principles. The Offer is made to the U.S. Holders on the same terms
and conditions as those made to all other shareholders of IAR to whom an offer
is made. Any information documents, including the offer document, are being
disseminated to U.S. Holders on a basis comparable to the method pursuant to
which such documents are provided to IAR's other shareholders.

The Offer, which is subject to Swedish law, is being made to the U.S. Holders in
accordance with the applicable U.S. securities laws, and applicable exemptions
thereunder. To the extent the Offer is subject to U.S. securities laws, those
laws only apply to U.S. Holders and thus will not give rise to claims on the
part of any other person. The U.S. Holders should consider that the price for
the Offer is being paid in SEK and that no adjustment will be made based on any
changes in the exchange rate.

It may be difficult for IAR's shareholders to enforce their rights and any
claims they may have arising under the U.S. federal or U.S. state securities
laws in connection with the Offer, since IAR and The Qt Company are located in
countries other than the United States, and some or all of their respective
officers and directors may be residents of countries other than the United
States. IAR's shareholders may not be able to sue IAR or The Qt Company or their
respective officers or directors in a non-U.S. court for violations of U.S.
securities laws. Further, it may be difficult to compel IAR or The Qt Company
and/or their respective affiliates to subject themselves to the jurisdiction or
judgment of a U.S. court.

To the extent permissible under applicable law and regulations and pursuant to
Rule 14e-5(b) of the U.S. Exchange Act, The Qt Company and its affiliates or its
brokers and its brokers' affiliates (acting as agents for The Qt Company or its
affiliates, as applicable) may from time to time and during the pendency of the
Offer, and other than pursuant to the Offer, directly or indirectly purchase or
arrange to purchase shares of IAR, or any securities that are convertible into,
exchangeable for or exercisable for such shares. These purchases may occur
either in the open market at prevailing prices or in private transactions at
negotiated prices, and information about such purchases will be disclosed by
means of a press release or other means reasonably calculated to inform U.S.
Holders of such information. In addition, the financial advisors to The Qt
Company may also engage in ordinary course trading activities in securities of
IAR, which may include purchases or arrangements to purchase such securities as
long as such purchases or arrangements are in compliance with the applicable
law. Any information about such purchases will be announced in Swedish and in a
non-binding English translation available to the U.S. Holders through relevant
electronic media if, and to the extent, such announcement is required under
applicable Swedish or U.S. law, rules or regulations.

The receipt of cash pursuant to the Offer by a U.S. Holder may be a taxable
transaction for U.S. federal income tax purposes and under applicable U.S. state
and local, as well as foreign and other, tax laws. Each shareholder is urged to
consult an independent professional adviser regarding the tax consequences of
accepting the Offer. Neither The Qt Company nor any of its affiliates and their
respective directors, officers, employees or agents or any other person acting
on their behalf in connection with the Offer shall be responsible for any tax
effects or liabilities resulting from acceptance of the Offer.

NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY U.S. STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THE OFFER, PASSED ANY COMMENTS
UPON THE MERITS OR FAIRNESS OF THE OFFER, PASSED ANY COMMENT UPON THE ADEQUACY
OR COMPLETENESS OF THIS STOCK EXCHANGE RELEASE OR PASSED ANY COMMENT ON WHETHER
THE CONTENT IN THIS STOCK EXCHANGE RELEASE IS CORRECT OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES.

Disclaimer

Nordea Bank Abp ("Nordea"), which is supervised by the European Central Bank and
the Finnish Financial Supervisory Authority and Stifel Nicolaus Europe Limited
("Stifel"), which is authorised and regulated by the Financial Conduct Authority
are acting as financial advisors to The Qt Company and no one else, in
connection with the Offer and will not regard any other person as their client
in relation to the Offer and will not be responsible to anyone other than The Qt
Company for providing the protection afforded to their respective clients, or
for providing advice in relation to the Offer or any other matters referred to
in this announcement. Neither Nordea, Stifel, nor any of their affiliates, or
their or any of their affiliates' respective employees, board members, officers,
vendors, advisors, members, successors, representatives or agents owes or
accepts any duty, liability or responsibility whatsoever (whether direct or
indirect, consequential, whether in contract, in tort, in delict, under statute
or otherwise) to any person who is not a client of Nordea or Stifel,
respectively, in connection with the Offer or otherwise.

\[1\] Based on EUR/SEK conversion rate of 11.2515 at 3 July 2025.

\[2\] Based on 12,737,336 outstanding Shares, which excludes 322,955 shares of
class B and 308,042 shares of class C held in treasury by IAR.

\[3\] Assuming the transaction would have been completed at the beginning of
financial year 2024. Assumed EUR/SEK conversion rate of 11.459 at 31 December
2024.

\[4\] Based on 12,737,336 outstanding Shares, which excludes 322,955 shares of
class B and 308,042 shares of class C held in treasury by IAR.