Crayon Group Holding — Share Issue/Capital Change 2017

Oct 11, 2017

Crayon announces its intention to launch an Initial Public Offering and apply for a listing on the Oslo Stock Exchange

Crayon announces its intention to launch an Initial Public Offering and apply for a listing on the Oslo Stock Exchange

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Crayon announces its intention to launch an Initial Public

Offering and apply for a listing on the Oslo Stock Exchange

Oslo, 11 October 2017: Crayon Group Holding ASA* (together

with its subsidiaries "Crayon" or the "Company") today

announces its intention to launch an Initial Public Offering

(the "IPO") and to apply for a listing on the Oslo Stock

Exchange.

Crayon is a leading software license lifecycle management

company. The Company is a strategic partner for the world's

leading software developers (e.g. Microsoft, Amazon and IBM)

and advises its clients on optimising software spending

through the software lifecycle. This includes planning,

purchasing, deployment and compliance of software, resale of

software and assisting clients with selective deployment of

modern IT solutions. Crayon is experiencing strong demand

for its services on the back of the evolving digital

transformation into the cloud, the accompanied increased IT

complexity, and IT spending becoming a larger share of

companies cost base.

Crayon was founded in 2002 and listed on Oslo Børs following

the merger with Inmeta in 2011 until completion of the

voluntary offer for the shares in the Company by Norvestor

VI L.P. ("Norvestor") in 2012. After the delisting, Crayon

has focused on international expansion. From 2014-2016

Crayon invested approximately NOK 280 million in expanding

globally and developing its IP solutions, and now the

Company is set to harvest the benefits as expansion markets

matures. At the same time, EBITDA from the core markets in

the Nordics is at record high. The Company is now present

across 21 countries worldwide with headquarters in Oslo,

Norway. As of 30 June 2017, Crayon had 1,079 employees.

Crayon has grown revenues from NOK 2,047 million in 2012 to

NOK 6,015 million in 2016, representing an annual growth

rate (CAGR) of 31% over the period. The strong momentum has

continued into H1 2017 with Crayon growing revenues by 18%

compared to H1 2016. Crayon reported gross profit of NOK

1,128 million and Adjusted EBITDA** of NOK 105 million in

2016. Gross profit and Adjusted EBITDA** last twelve months

as of Q2 2017 was NOK 1,175 million and NOK 134 million,

respectively.

Company Highlights

- Operating in an attractive market with digitalisation

accelerating software growth and complexity

- Uniquely positioned to aid customers reduce costs and

optimise software ROI

- Resilient business model with high share of recurring

revenue and loyal customer base

- Ready to harvest on recent successful international

expansion

Torgrim Takle, CEO of Crayon, commented:

"I am very proud of the strong growth the Crayon team has

demonstrated over a long period of time and the successful

development from being a Norwegian licensing provider to

having global ambitions and becoming a valued go-to-market

partner for global software vendors. I am also very excited

about the future of Crayon - we have invested in global

expansion, and we are now set to reap the benefits as the

expansion markets mature. We look forward to offering new

shareholders the opportunity to invest in Crayon's growth."

Henning Vold, Partner in Norvestor Equity AS and Chairman of

the Board of Crayon, commented:

"Norvestor sponsored the delisting of Crayon in 2012 to back

an ambitious growth plan. From a Nordic base the Company has

established a global position in 21 countries and is an

important partner for the large software vendors. The IPO is

a natural next step in the Company's development and marks

the beginning of a new phase in which the Company is set to

harvest from investments made. The IPO will help the Company

to secure a broader, long-term shareholder base, and we look

forward to inviting new shareholders to join Norvestor as

owners. In addition, the listing will provide access to the

capital markets and enhance Crayon's visibility among

potential partners."

Offering Highlights

The IPO will comprise a public offering in Norway and a

private placement to institutional and other professional

investors in Norway and outside Norway subject to applicable

exemptions from prospectus and other filing requirements.

The current majority owner, Norvestor, intends to reduce its

ownership in the Company through a secondary sale of shares

in the contemplated IPO, but will remain a significant

shareholder after the IPO. In addition to the secondary

sale, the Company is aiming to conduct an offering of new

shares raising gross proceeds of approximately NOK 300

million in order to reduce leverage and provide the Company

with additional flexibility to support the Company's growth

strategy, including accretive acquisitions. The Company is

expected to apply approximately NOK 150 million of the net

proceeds from an offering of new shares to prepay parts of

its outstanding FRN Senior Secured Bonds 2017/2020 (ISIN:

NO0010789985) by utilising the Equity Claw-Back as per the

bond agreement.

The IPO will further support Crayon's strategy and growth

plan, and is expected to secure a sustained strong, diverse

and long-term shareholder base.

Completion of the IPO will be subject to receiving the

relevant approvals from Oslo Stock Exchange and the

Norwegian Financial Supervisory Authority, as well as

prevailing equity capital market conditions.

Carnegie AS and DNB Markets, a part of DNB Bank ASA, are

acting as Joint Global Coordinators and Joint Bookrunners in

the IPO; Danske Bank A/S, Norwegian branch is acting as

Joint Bookrunner and Sparebank 1 Markets AS is acting as

Joint Lead Manager (hereinafter together referred to as

the "Managers").

Advokatfirmaet Thommessen AS is acting as Norwegian legal

counsel to the Company. Advokatfirmaet BA-HR DA is acting as

Norwegian legal counsel to the Managers.

Further announcements relating to the process will be made

in due course.

Enquiries

Torgrim Takle, CEO

torgrim.takle@crayon.com, +47 951 40 782

Knut Ansten, CFO

knut.ansten@crayon.com, +47 994 59 086

Note (*):The current registered name of the Company is

Crayon Group Holding AS, but it plans to change its name to

Crayon Group Holding ASA and to register as a public limited

liability company (ASA) prior to the IPO.

Note (**): Adjusted EBITDA is reported EBITDA adjusted for

exceptional items. Exceptional items were NOK 13 million in

2016 and NOK 13 million last twelve months as of Q2 2017.

Important Notice

United States

These materials may not be published, distributed or

transmitted in the United States, Canada, Australia, the

Hong Kong Special Administrative Region of the People's

Republic of China, South Africa or Japan. These materials do

not constitute an offer of securities for sale or a

solicitation of an offer to purchase securities

(the "Shares") of Crayon Group Holding ASA (the "Company")

in the United States, Norway or any other jurisdiction. The

Shares of the Company may not be offered or sold in the

United States absent registration or an exemption from

registration under the U.S. Securities Act of 1933, as

amended (the "Securities Act"). The Shares of the Company

have not been, and will not be, registered under the

Securities Act. Any sale in the United States of the

securities mentioned in this communication will be made

solely to "qualified institutional buyers" as defined in

Rule 144A under the Securities Act.

European Economic Area

Any offering of securities will be made by means of a

prospectus to be published that may be obtained from the

issuer or selling security holder, once published, and that

will contain detailed information about the Company and its

management, as well as financial statements.

These materials are an advertisement and not a prospectus

for the purposes of Directive 2003/71/EC, as amended

(together with any applicable implementing measures in any

Member State, the "Prospectus Directive"). Investors should

not subscribe for any securities referred to in these

materials except on the basis of information contained in

the prospectus.

In any EEA Member State other than Norway (from the time the

prospectus has been approved by the Financial Supervisory

Authority of Norway, in its capacity as the competent

authority in Norway, and published in accordance with the

Prospectus Directive as implemented in Norway) that has

implemented the Prospectus Directive, this communication is

only addressed to and is only directed at "qualified

investors" in that Member State within the meaning of

Article 2(1)(e) of the Prospectus Directive ("Qualified

Investors"), i.e., only to investors to whom an offer of

securities may be made without the requirement for the

Company to publish a prospectus pursuant to Article 3 of the

Prospectus Directive in such EEA Member State.

United Kingdom

In the United Kingdom, these materials are only being

distributed to and are only directed at Qualified Investors

who (i) are investment professionals falling within Article

19(5) of the Financial Services and Markets Act 2000

(Financial Promotion) Order 2005 (as amended) (the "Order")

or (ii) are persons falling within Article 49(2)(a) to (d)

of the Order (high net worth companies, unincorporated

associations, etc.) (all such persons together being

referred to as "Relevant Persons"). These materials are

directed only at Relevant Persons and must not be acted on

or relied on by persons who are not Relevant Persons. Any

investment or investment activity to which this document

relates is available only to Relevant Persons and will be

engaged in only with Relevant Persons.