Wednesday, 10 July 202 4
Below is the summary of the main news of relevance in Iceland last week. The summary, which is based on publicly available information only, is prepared by the BBA//Fjeldco team for the benefit of clients and contacts of the firm and is subject to the disclaimer noted below.
Wednesday, 10 July 2024
Preliminary financial results of Alvotech show 10-fold increase in revenue
Baader Skaginn 3X files for bankruptcy
Freyja Healthcare secures 8 million USD in funding
Alvotech converts bonds held by shareholders to equity
Additional issuance of government bonds surprises the market
Lifting of rules on forward trading of ISK not timely says CBI
Taxable wages increase by 5.2%
Landsbanki to advise on sale of Islandsbanki
Two of largest shareholders in Islandsbanki sell shares worth more than 1 billion ISK
Largest private investors in Festi sell all shares worth 3 billion ISK
Sky Lagoon pays 946 million ISK in dividends
Land-based fish farming company Laxey raises 900 million ISK from international investors
BBA//Fjeldco is an Icelandic corporate law firm, with offices in Reykjavik and London, providing advice in relation to mergers and acquisitions, capital markets, banking and corporate finance, energy and PFI and PPP projects, as well as general corporate and commercial matters. If you have any questions about investments and developments in Iceland, please do not hesitate to contact a member of the BBA//Fjeldco team.
Disclaimer
This communication is intended to provide general information on matters of interest and you should not act or refrain from acting upon any information contained on it without seeking appropriate professional advice on the particular facts and circumstances at issue BBA//Fjeldco makes no representation or warranty of any kind with respect to the subject matter included herein or the completeness or accuracy of the information BBA//Fjeldco is not responsible for any actions (or lack thereof) taken as a result of relying on or in any way using information contained in this email and in no event shall be liable for any damages resulting from reliance on or use of this information To the maximum extent permitted by law, BBA//Fjeldco expressly excludes all conditions, warranties and other terms which might otherwise be implied by statute, common law or the law of equity and further disclaims all losses, including without limitation indirect, incidental, consequential, or special damages arising out of or in any way connected with access to or use of these emails or the content (including, without limitation, any losses arising directly or indirectly from any inaccuracies, defects, errors, whether typographical or otherwise, omissions, out of date information or otherwise), even if BBA//Fjeldco has been advised of the possibility of such damages
Preliminary financial results of Alvotech show 10-fold increase in revenue
Alvotech, a global manufacturer of biosimilars (biologic medicines that are highly similar to and have no clinically meaningful differences from existing approved biologic medicines) reported last week a strong preliminary revenue growth with total revenues for the second quarter of 2024 of between 196 and 201 million USD and total revenues for the first six months between 233 and 238 million USD This is approximately a 10-fold increase compared to the same period in 2023 In the statement, Robert Wessman, Chair and CEO of Alvotech said: “We expect that these results, in combination with our debt refinancing, will put us in an optimal position to drive revenue growth and profitability for the full year.”
Baader Skaginn 3X files for bankruptcy
The food equipment production company, Baader Skaginn 3X , based in Akranes West Iceland filed for bankruptcy last week 128 employees will lose their jobs The German international industrial giant Baader bought 60% of all shares in the company in 2020 and the remaining 40% two years later In 2023 difficulties in operations were made public when the company’s facilities in Isafjordur in West Fjords were closed and 27 people were made redundant According to the daily Morgunbladid, Islandsbanki is the main creditor of the bankrupt estate Some parties have already shown interest in the company according to the trustee of the estate, Helgi Johannsson, who said in an interview with the paper that everything will be done to realise the value of the assets as soon as possible.
Freyja Healthcare secures 8 million USD in funding
Freyja Healthcare that was founded in 2017 by the Icelandic genecologist and professor at Harvard University in the US, Jon Ivar Einarsson, has secured 8 billion USD in funding according to a report in the business publication Vidskiptabladid. Freyja Healthcare has patented fifteen medical treatments, one of which has already been approved by the FDA in the US and ready to be marketed and sold next year According to Einarsson most of the investors in this initial round of funding are Icelandic Arctica Finance advised Freyja Healthcare in the process and according to Vidskiptabladid, the interest of Icelandic investors was great even though the company has not begun operation in Iceland Einarsson says that in the next round of funding the company wants to find an international partner with specific interest and experience in the healthcare sector
Alvotech converts bonds held by shareholders to equity
Last week, Alvotech issued 22,073,578 new ordinary shares in exchange for convertible bonds mainly held by existing shareholders in the company, at the fixed price of 10 USD per share. Following the conversion, the total number of issued shares in Alvotech is 324,801,040 and the total number of outstanding shares is 301,944,470 according to a statement from the company. In a separate statement from the company, it was announced that companies owned by the founder and CEO of Alvotech, Robert Wessman, Aztiq Pharma Partners and ATP Holding, acquired 2 587,089 additional shares as a result of the conversion of convertible bonds
Additional issuance of government bonds surprises the market
The planned additional issuance of government bonds worth 30 billion ISK later this year that was announce late last month surprised the market according to a report on the business website Innherji. The government borrowing requirement for the second half of this year increased suddenly by 85%. Fund managers assumed that the previously planned issuance of 120 billion ISK would be sufficient for this year. When the markets opened after the announcement last Monday the price of the bonds went down in trading worth 10 billion ISK and the yield went up accordingly, according to the report
Lifting of rules on forward trading of ISK not timely says CBI
The business website Innherji has reported with reference to minutes from the CBI’s committee on financial stability that the committee is of the opinion that holdings of ISK should continue to be limited by means of national economic precautions Accordingly, the committee has concluded that the rules on forward trading of ISK should be changed carefully and not for now The IMF proposed recently that restriction on currency trading should be lifted as the high interest rate in Iceland compared to other markets would increase the interest in ISK.
Taxable wages increase by 5.2%
The total sum of taxable wages increased by 5.2% in May 2024 from the previous month while the increase from 2023 was 6 5% according to a statement from Statistics Iceland The total sum of taxable wages was 173 9 billion ISK, the number of employees was near 217,800 and the number of employers was roughly 21,800
Landsbanki to advise on sale of Islandsbanki
The ministry of finance has appointed Landsbanki as an independent advisor in the sale of the state´s 42.5% share in Islandsbanki according to a report from the daily Morgunbladid. The ministry had earlier this year appointed Arctica Finance as an advisor, but last month the financial consulting company requested to be released from all responsibilities as a result of developments in other projects the consultancy had undertaken. Late last month, parliament passed a law permitting the sale of the shares in Islandsbanki in a public market share offering between 2024 and 2025
Two of largest shareholders in Islandsbanki sell shares worth more than 1 billion ISK
Two of the pension funds that have a leading role in a group of investors in Islandsbanki sold shares in the bank for more than 1 billion ISK when the bank offered to buy such shares in a repurchasing program according to a report on the business website Innherji Gildi pension fund, the third single largest shareholder in Islandsbanki, sold 10 5 million shares for nearly one billion ISK and now holds 7 24% of all shares in the bank LIVE pension fund sold 5 million shares and now holds 5.66% in the bank. The Icelandic pension funds hold a total of 35% of all shares in Islandsbanki.
Sky Lagoon pays 946 million ISK in dividends
The luxury spa and resort Sky Lagoon that opened in Kopavogur near Reykjavik in 2021 increased its revenue from 3 3 billion ISK in 2022 to 5 billion ISK in 2023 The profit increased from 410 million ISK in 2022 to 946 million in 2023 These are the figures reported in business publication: Vidskiptabladid
Land-based fish farming company Laxey raises 900 million ISK from international investors
The land-based fish farming company Laxey in Westman Islands recently raised 900 million ISK in equity from international investors including Norwegian family funds with experience in fish farming related investments, Farvatn Private Equity and Kontrari. According to a report in the business publication Vidskiptabladid the fundraising is in addition to the 6 billion ISK equity raised in April this year with domestic investors. Mar Advisor, an independent Icelandic corporate finance boutique and the Norwegian investment bank Arctic Securities were advisors and managers of the equity offering process
Key figures as of 1 July 2024*
Inflation 5.8%
Key interest rate 9.25%
Exchange rate
USD 137 93
GBP 176 45
EUR 149 30 *based on information from www cb is
