CCC fashion does not rule out issue of up to 1 mln extra shares in case of overdemand

"We are issuing up to 10 million units, while we will cut this final issue size to what is needed. The share price will come out of the book building, so we will see what it will be in the end, and it will dictate the number of shares, which is necessary to raise PLN 1.36 billion [for the buyout of minority shareholders of Modivo - PAP Biznes ed.]," CCC's deputy CEO Karol Poltorak said.

"If there is a significant overdemand, we as a company will be ready to decide to issue up to 1 million additional shares, and the funds would go to accelerate the development of HalfPrice. However, the priority is to absolutely fund this buyback transaction, close this stage and go into full integration," he added.

The deputy CEO elaborated that the assumption was that the possible issue of up to 1 million additional shares would be within this pool of up to 10 million shares.

"The number of shares issued will not exceed 10 million, even with this 1 million extra," Poltorak said.

CCC's management board has agreed with the minority shareholders of its subsidiary Modivo the terms and conditions of the sale of Modivo's shareholdings to CCC using the proceeds from the issue of CCC's N-series shares. A total of four entities will sell Modivo shares to CCC, representing 22.81 percent of company's capital.

Approximately PLN 1.36 billion (EUR 326.67 mln) will be paid by CCC to the minority shareholders with the cash that the company plans to raise from the issue of new shares, and approximately PLN 50 million (EUR 12 mln) will be settled by contractual set-off of the mutual receivables of the company and the sellers.

It is to come from the conditional commitment agreements and agreements to take up 2.5 million series D subscription warrants of the company, which the company plans to issue to AR and EMBUD 2, at an issue price of PLN 20 (EUR 4.80) per warrant, entitling to take up 2.5 million series O shares of the company.

The implied valuation of 100 percent stakes of Modivo is PLN 5.95 billion (EUR 1.43 bln).

CCC's management board has received a declaration from the company's shareholder, Ultro, to provide the company with equity financing of approximately PLN 500 million (EUR 120.1 mln) through a share issue. Ultro, owned by CCC's CEO Dariusz Miłek, intends to maintain or increase its shareholding in CCC after the issue.

"This leaves us with a market pool of PLN 900 million to raise," said the deputy CEO.

The CCC Group explains that achieving full ownership of Modivo is necessary for the full implementation of the CCC Group's strategy.

The aim is to fully integrate Modivo into the group's structures. The Modivo group's modified business model involves the transformation of its operations into the operational centre of the online business of the entire CCC group, which entails the need for close operational integration of all channels and unification of the customer base. The previously announced plans for an IPO have been abandoned.

Wieslaw Oles, head of the CCC's supervisory board, presented at the conference a proposal for a 5-year bonus programme for CEO Dariusz Milek and his management team.

"Dariusz Miłek is not interested, as he has declared publicly, in receiving ordinary salaries. On the other hand, we were keen to ensure that he stays in the company for the next five years. (...) Hence, the idea of creating an option programme was born," Oles explained.

As he informed, the programme envisages the issue of warrants that could be converted into shares depending on the company's stock market valuation. The first condition is a share price of PLN 300 (EUR 72.06). The warrants will entitle to subscribe for new shares at a price of PLN 200 (EUR 48.04).

CCC has called an extraordinary general meeting on the capital increase and incentive programme for March 17.

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