Carbios Announces the Launch of a Rights Issue Totalling Around €122 Million, Likely to Be Increased to Around €141 Million If the Extension Clause Is Fully Exercised

Transaction details

• Subscription price: €25.32 per new share
• Subscription exchange rate: 3 new shares for 7 existing shares
• Trading period for pre-emptive subscription rights: 23 June to 5 July 2023 inclusive
• Subscription period: 27 June to 7 July 2023 inclusive
• Result of the capital increase: 11 July 2023
• Settlement-delivery and admission of new shares on Euronext Growth Paris: 13 July 2023
• Eligibility of Carbios shares for the PEA, the PEA-PME and the 150-0 B ter scheme of the French General Tax Code (reinvesting capital gains)

This press release shall not be published, distributed or disseminated, directly or indirectly, in the United States of America, Australia, Canada or Japan

This an advertisement and not a prospectus within the meaning of Regulation (EU) 2017/1129, as amended.

Carbios shares and PSR are eligible for the PEA and PEA PME investment schemes, subject to conditions. PSR cannot be acquired in connection with the PEA.

CLERMONT-FERRAND, France–(BUSINESS WIRE)–Regulatory News:

Carbios (Euronext Growth Paris: ALCRB), a pioneer in the development and industrialization of biological technologies to reinvent the life cycle of plastics and textiles (the “Company”), announces today the launch of a capital increase in cash with pre-emptive subscription rights maintained for shareholders (“PSR”) totalling an initial gross amount of around €122 million, likely to be increased to around €141 million if the extension clause is fully exercised (the “Capital Increase”).

“In 2013, we presented a vision that one day our innovative technologies, inspired by nature, would revolutionize the life cycle of plastic and textiles to protect the planet and our oceans from plastic pollution. This ambitious promise is now becoming reality, backed by solid research results that have exceeded our expectations.

It is now time to take our industrial and commercial project a step further with the commissioning in 2025, in France, of the world’s first PET biorecycling plant, in partnership with Indorama Ventures, a leading producer of recycled PET for the bottle market¹. To this end, Carbios enjoys strong support from public authorities², an ecosystem of global players in the Food & Beverage, cosmetics and apparel industries, and its strategic alliance with Novozymes, the world leader in enzyme production.

It is with the aim of financing this plant, accelerating our R&D and the deployment of research activities for other polymers and other applications of our technologies, that we are launching this capital increase with the maintenance of pre-emptive subscription rights to let you take part in the acceleration of our growth.

We are delighted that we already have the backing of our strategic shareholders, whose continued support reflects their confidence in this project’s success, and their aim to tackle the global emergency of plastic pollution. We hope that the transaction we are offering today will receive your support, giving you the opportunity to be an integral part of this unifying project for the future,” says Emmanuel Ladent, CEO of Carbios.

Purpose of the Capital Increase

The net proceeds from the issue of the Offered Shares (as defined below) will be used as follows:

– approximately 85% of the net proceeds of the issue will be used to finance the construction of the first plant, with an estimated production capacity of 50,000 tonnes per year and an estimated investment of approximately 230 million euros. The part of the investment in the first plant not financed by the net proceeds of the issue will be financed by financing to be received from Indorama Ventures (approximately €110 million), subsidies from the French government (€30 million) and the Grand-Est Region (€12.5 million) and part of the Company’s available cash (€83 million at 31 May 2023);

– approximately 15% of the net proceeds of the issue will be used to fund PET R&D activities.

In the event that the Extension Clause (as this expression is defined hereinafter) is partially or fully exercised, the Company is envisaging to use the additional net proceeds from the issue to accelerate the rollout of its research activities for other polymers and/or other applications of its technologies.

The proceeds from the Capital Increase in the event of 100% fulfilment are estimated at around €118 million (which may be increased to around €136 million if the Extension Clause is fully exercised).

Financing of the construction the first industrial plant

The global investment for the first plant is estimated to €230 million³. On the basis and subject to the terms and conditions of the memorandum of understanding signed with Indorama Ventures⁴ (Carbios and Indorama Ventures intending to finalize the contractual documentation by the end of 2023), Indorama Ventures plans to mobilize about €110 million for the Joint Venture in equity and non-convertible loan financing⁵. The financing by Carbios of €120 million would include a financing of up to €42.5 million (in the form of subsidies) from the French State and the Grand-Est Region. The balance, i.e. c. €77.5 million, which will stagger until the commissioning, would be realised with a part of the Company’s available cash position (amounting, as a reminder, to €83 million as at 31 May 2023), with the remainder of the non-collected subsidies and with a part of the proceeds of the issuance of the Offered Shares.

Besides, the estimated breakdown of the financing of the first plant until the end of the first semester of 2024 shall be the following : €1.4 million during June 2023, €22 million during the second semester of 2023 and €35 million during the first semester of 2024, corresponding to the disbursements for various studies and the first instalments on orders made for “long-lead time” equipment that will be spread out until commissioning of the plant in 2025. In addition, the Company estimates its cash burn in relation to the coverage of its various costs (including operating costs and capital expenditure, excluding financing of the first plant) at approximately €32.5 million until the end of the first semester of 2024.

Therefore, the global financing need until the end of the first semester of 2024 is estimated to €90.9 million, including 58.4 million in relation to the financing of the first plant and €32.5 million in relation to various costs (including operating costs and capital expenditure, excluding financing of the first plant). €16.6 million worth of subsidies are to be collected to complete the Company’s cash position on this period (including €12.5 million in the form of subsidies from the French State and from the Grand-Est region relating to the financing of the plant). It is recalled that the Company’s available cash position amounted to €83 million as at 31 May 2023.

In the long run, it is envisaged that Carbios will enter into a licensing agreement with the joint venture. In Carbios’ consolidated financial statements, intra-group financial flows are neutralized in accordance with current accounting standards. In addition to this licence agreement with its reference shareholder (Carbios), the joint venture is expected to enter into a supply agreement, a monomer supply agreement with Indorama Ventures and a royalty agreement on the PET produced by Indorama Ventures from these monomers.

Main terms and conditions of the Capital Increase

The Capital Increase will be carried out with pre-emptive subscription rights maintained for shareholders, in accordance with the 11th and 12th resolutions of the combined general meeting of shareholders of 22 June 2022.

Its completion will result in the issue of 4,833,648 new shares (the “New Shares”), which may be increased, if the Extension Clause is fully exercised, by 725,047 additional new shares (the “Additional New Shares” and together with the Initial Shares, the “Offered Shares”) at the subscription price of €25.32 per Offered Share (or €0.70 in par value and €24,62 in share premium), to be fully paid up upon subscription by payment in cash, representing a gross amount, including share premium, of 122,387,967 euros, which may be increased to a gross amount of 140,746,157 euros, if the Extension Clause is fully exercised.

Each shareholder of the Company will receive, on 23 June 2023, one (1) PSR per share registered on an accounting basis in his/her securities account at the end of the accounting day of 22 June 2023. Seven (7) PSR will entitle the holders to subscribe for three (3) Offered Shares as of right.

Subscriptions for excess shares will be permitted. Offered Shares not subscribed for as of right will be assigned to PSR holders who have placed orders for excess shares and divided among them subject to a reduction in the event of oversubscription.

Based on the closing price of the Carbios share on the Euronext Growth market in Paris on 20 June 2023, i.e. €40.10, the theoretical value of one (1) PSR is €4.43 and the theoretical value of the ex-rights share is €35.67.

The subscription price per Offered Share represents a discount of -29% compared to the theoretical value of the Carbios ex-rights share and a nominal discount of -37% compared to the closing price of the Carbios share on the trading day preceding the Prospectus approval date, i.e. €40.10 on 20 June 2023.

These values do not necessarily reflect the value of the PSR during their trading period, or the value of the Carbios ex-rights share or the haircuts, as they will be observed on the market.

The Capital Increase will be open to the public exclusively in France.

The PSR will be tradeable from 23 June 2023 to 5 July 2023 inclusive on the Euronext Growth Paris market under ISIN code FR0013251287.

The Offered Shares will bear current dividend rights. They will be immediately assimilated to the Company’s existing shares and will be traded under the same ISIN code FR0013156007 from 13 July 2023.

Extension Clause

Depending on demand, the Company may decide to increase the number of Initial Offered Shares by a maximum of 15%, i.e. a maximum number of 725,047 Additional Offered Shares (the “Extension Clause”).

The decision to exercise the Extension Clause will be made by the Company, after consulting with the Global Coordinators and Joint Bookrunners, at the latest on the day on which the results of the Capital Increase are published, scheduled for 11 July 2023, and will be stated in the press release circulated by the Company and posted on the Company’s website, and in the notice circulated by Euronext Paris S.A. announcing the results of the Capital Increase.

Indicative timetable for the Capital Increase

Guarantee

The issuance of the Offered Shares is not covered by a guarantee agreement or an underwriting agreement. If the amount of subscriptions received totals less than three quarters of the Capital Increase decided upon, the Capital Increase would be cancelled. Investors who would have acquired pre-emptive subscription rights on the market would have acquired rights that would ultimately become not applicable, resulting in them making a loss equal to the price of acquiring the pre-emptive subscription rights (they would nevertheless be refunded the amount of their subscription upon exercising their pre-emptive subscription rights).

On 21 June 2023, the Company concluded an agency contract with BNP Paribas, Bryan Garnier & Co, Bryan Garnier Securities and Natixis as global coordinators and joint bookrunners (the “Global Coordinators and Joint Bookrunners”). Under the terms of this agency contract, the Global Coordinators and Joint Bookrunners have agreed to assist the Company in connection with the subscription for Offered Shares to be issued as part of the Capital Increase by shareholders and any transferees of pre-emptive subscription rights. The Global Coordinators and Joint Bookrunners are not acting as guarantors in respect of the Capital Increase.

Subscription commitments and subscription intent from the Company’s main shareholders, members of its administrative or management bodies, or anyone intending to subscribe for more than 5% of the Offered Shares:

On the Prospectus approval date, the Company has the following subscription commitments (the “Subscription Commitments”):

Company’s lock-up agreement

Starting from the signature of the Agency Contract and for a period of 120 calendar days following the date of the settlement-delivery of the Offered Shares, subject to certain usual exceptions.

Retention commitments of certain shareholders and directors of the Company

The subscription undertakings signed by the shareholders BOLD Business Opportunity for L’Oréal Development, Michelin Ventures (also directors of the Company), Copernicus Wealth Management (also censor of the Company), Truffle Capital and Groupe L’Occitane, are subject to a lock-up commitment with effect from the date of signature of the said commitment and until the expiry of a period of 90 calendar days following the settlement-delivery date of the Offering Shares, covering both the shares acquired on the occasion of the issue and the shares previously held, subject to certain customary exceptions.

With regard to management, the subscription undertakings signed by the directors wishing to participate in the transaction (Amandine De Souza, Sandrine Conseiller and Karine Auclair) are subject to a lock-up commitment from the date of signature of said undertaking until the expiry of a period of 90 calendar days following the settlement-delivery date of the Offering Shares, subject to certain customary exceptions, relating to shares held subsequent to the Issue, none of them being a shareholder of the Company prior to the Issue.

Terms of subscription

• If you are a shareholder in the company

You have PSR attached to your Carbios shares, which entitle to you to subscribe as a priority, as of right, for the Offered Shares by applying the ratio of 3 Offered Shares for 7 PSR (1 existing share giving the right to 1 PSR).

– either you have an exact and sufficient number of existing shares to be able to subscribe via your PSR for a whole number of Offered Shares (for example, if you have 7 Carbios shares, you will be able to subscribe as a priority for 3 Offered Shares);

– or you do not have a sufficient number of existing shares to obtain a whole number of Offered Shares, meaning that you can buy or sell the number of PSR to reach the ratio resulting in a whole number of Offered Shares (3 Offered Shares for 7 PSR).

You may also subscribe for the excess number of Offered Shares that you wish to, in addition to the number of Offered Shares resulting from the exercise of your PSR as of right. Any Offered Shares not absorbed by the irreducible subscriptions shall be distributed and allocated to the subscribers as excess shares. Subscription orders for excess shares will be served within the limit of their requests and in proportion to the number of PSR used in support of their subscription as of right, without resulting in an allocation of fractional Offered Shares. A reduction scale will be applied and communicated when the results of the Capital Increase are announced by Euronext Paris.

• If you are not yet a shareholder in the company

You can subscribe by acquiring PSR on the stock market from 23 June 2023 to 5 July 2023 inclusive, through the financial institution that handles your security account, and:

– by subscribing as of right, by 7 July 2023 at the latest, by exercising your PSR, through said financial institution;

– and, where applicable, by subscribing for excess Offered Shares by placing an order through the financial institution that handles your security account, by 7 July 2023 at the latest. You can only subscribe for excess shares if you have already subscribed as of right.

If the amount of subscriptions received totals less than three quarters of the Capital Increase decided upon, the Capital Increase would be cancelled. Investors who would have acquired pre-emptive subscription rights on the market would have acquired rights that would ultimately become not applicable, resulting in them making a loss equal to the price of acquiring the pre-emptive subscription rights (they would nevertheless be refunded the amount of their subscription upon exercising their pre-emptive subscription rights).

Impact on the distribution of the Company’s share capital

Based on the number of outstanding shares on the date of the Prospectus, information brought to the Company’s knowledge on the shareholder structure on the date of the Prospectus and the Subscription Commitments, and on the assumption that the Capital Increase will be fully subscribed (excluding the exercise of the Extension Clause), the Company’s shareholder structure would be as follows:

On the assumption that the Capital Increase will be fully subscribed and that the Extension Clause is fully exercised, the Company’s shareholder structure would be as follows:

Contacts

Carbios
Melissa Flauraud
Press Relations

[email protected]

Benjamin Audebert
Investor Relations

[email protected]
+33 (0)4 73 86 51 76

Financial communication
Actifin
Benjamin Lehari

[email protected]
0 805 650 075

Financial Press Relations

Michael Schölze

[email protected]
+33 (0)1 56 88 11 14

Press Relations (France)
Iconic
Marie-Virginie Klein

[email protected]
+33 (0)1 44 14 99 96

Press Relations (DACH & UK)
MC Services

Anne Hennecke

[email protected]
+49 (0)211 529 252 22

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