Fleming Properties AB's Independent Bid Committee Advises Against Accepting Colony Real Estate's Offer

In a decisive move, the independent bid committee of Fleming Properties AB ("Fleming Properties" or "the Company") has unanimously recommended that shareholders reject the cash offer made by Colony Real Estate Sweden Holding AB ("Colony Real Estate") on July 30, 2024. This recommendation comes after a comprehensive evaluation process conducted in accordance with point II.19 of the Takeover Rules issued by the Swedish Securities Council.

Background

On July 3, 2024, Colony Real Estate announced that it had subscribed to and been allocated 23,162,440 newly issued shares in Fleming Properties through its pro rata share and acquired subscription rights in the rights issue announced by the Company on May 29, 2024. This acquisition brought Colony Real Estate's total ownership to 24,478,684 shares, representing approximately 37.40% of the total shares and votes in the Company, thereby crossing the mandatory bid threshold according to the Takeover Rules.

Offer Details

Colony Real Estate's offer price per share includes a premium/discount as follows:

• -3.85% relative to the closing price on the Spotlight Stock Market of SEK 5.20 on June 25, 2024.
• 0.70% relative to the volume-weighted average price on the Spotlight Stock Market of SEK 4.97 over the last 20 trading days ending June 25, 2024.
• -2.91% relative to the closing price on the Spotlight Stock Market of SEK 5.15 on July 2, 2024.
• -1.51% relative to the volume-weighted average price on the Spotlight Stock Market of SEK 5.08 over the last 20 trading days ending July 2, 2024.
• -13.79% relative to the closing price on the Spotlight Stock Market of SEK 5.80 on July 29, 2024.
• -11.72% relative to the volume-weighted average price on the Spotlight Stock Market of SEK 5.66 over the last 20 trading days ending July 29, 2024.

The acceptance period for the offer began on July 31, 2024, and will end on August 28, 2024. The offer is not subject to any completion conditions.

Independent Bid Committee's Evaluation

The independent bid committee, comprising Chairman Thomas Lindström, and board members Erica Magnergård and Karl Runeberg, with legal advice from Baker & McKenzie Advokatbyrå KB, and an independent fairness opinion from Catella Corporate Finance Stockholm AB, has conducted a thorough evaluation of the offer. The committee's assessment considered various factors such as the Company's stock price, strategic alternatives, market conditions, and future growth prospects.

Based on the independent fairness opinion from Catella, the committee concluded that the offer is not financially fair for Fleming Properties' shareholders. The committee believes that the terms of the offer do not reflect the Company's current value or its future growth potential.

Strategic Implications

While the committee acknowledges the positive aspect of Colony Real Estate's interest in increasing its stake in Fleming Properties, it remains firm in its stance that shareholders should reject the offer. Colony Real Estate has indicated that it does not plan any significant changes to the Company's operations, management, or employee conditions post-offer.

Conclusion

In summary, the independent bid committee of Fleming Properties AB advises shareholders to reject Colony Real Estate's offer. The committee believes that the offer does not adequately compensate for the Company's intrinsic value and future growth opportunities. Shareholders are encouraged to consider this recommendation carefully before making their decision.

For more information, please contact:

John Malmström, CEO, Fleming Properties AB
+46 (0) 8 402 53 84
john.malmstrom@paretosec.com

Thomas Lindström, Chairman, Fleming Properties AB
+46 (0) 70 892 51 30
thomas.lindstrom@temell.se

For further details, please refer to the full statement from the independent bid committee and the fairness opinion from Catella Corporate Finance Stockholm AB.