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Metro International S.A. is a Luxembourg limited-liability company
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METRO ISSUES NEW SHARES AND CONVERTS DEBT
10 June 2003
Metro will issue rights to subscribe for new class A shares to its holders of its Swedish Depository Receipts, except those domiciled in the United States of America, Canada and Japan, who will receive a cash payment equivalent to the amount that will be realised from the sale of their tradable rights. Each eligible shareholder will be offered the opportunity to subscribe for one new class A share for each existing class A or B share held, at a price of SEK 2.30 per share. Shareholders' subscription rights will be tradable on Stockholmsbörsen. In the event that the issue is not fully subscribed based on subscription rights, current shareholders will be able to subscribe for the remaining shares according to their pro-rata holding of shares. The rights issue will be fully underwritten by Industriförvaltnings AB Kinnevik ("Kinnevik"), which is Metro's largest shareholder and creditor. Kinnevik has also indicated that it intends to take up its rights in the offering based on its current shareholding in Metro.
Metro will publish details of the offer in an offering prospectus expected to be published in mid-July 2003 and intends to complete the issue during the first half of August 2003. The date of record for the issue is expected to be in mid-July 2003, with the offer period expected to commence during the second half of July 2003. Trading in the subscription rights will take place during the offer period. The cash proceeds from the issue will be used for general corporate and working capital purposes in order to bring Metro's existing operations into a positive cash flow position, and to repay additional short-term bridge financing provided by Kinnevik during the period until the completion of the share issue and conversion. This bridge financing is provided by Kinnevik on the same terms as its existing loan to Metro.
NOT FOR DISTRIBUTION IN THE UNITED STATES, CANADA OR JAPAN
At the same time as the rights offering, Metro will convert SEK 1,151 million of existing interest-bearing liabilities into equity by means of the issue of new class A and new class B shares at a price of SEK 3.75 per share to Kinnevik and Modern Times Group MTG AB ("MTG"), in exchange for the retirement of all interest-bearing liabilities, excluding the bridge financing, due to the two parties. The shares received in the conversion of debt to equity do not entitle the parties to participation in the rights issue.
Metro will issue 47.1 million new class A shares and 115.2 million new class B shares to Kinnevik in exchange for the retirement of SEK 609 million of Metro's long-term interest-bearing debt to Kinnevik, including interest accrued up to 31 May 2003. Metro will also issue 51.1 million new class A shares and 93.6 million new class B shares to MTG, in exchange for the retirement of SEK 542 million of interest-bearing debt, convertible bonds and interest payments accrued up to 31 May 2003. No interest will be charged on the loans for the period between 31 May 2003 and the completion of the transaction.
Metro's total interest-bearing liabilities following the conversion will principally constitute the SEK 300 million credit facility provided by Nordea to Metro Sweden AB on a three and a half year term in May 2002.
Kinnevik's total shareholding in Metro following the conversion of debt into equity will be 63.1 million class A shares and 116.1 million class B shares. Kinnevik is eligible to subscribe for 16.8 million class A shares under the terms of the offer, based on its current holding of 16.0 million class A shares and 0.8 million class B shares. MTG's total shareholding in Metro following the conversion of debt into equity will be 52.3 million class A shares and 96.9 million class B shares. MTG is eligible to subscribe for 4.5 million class A shares under the terms of the offer, based on its current holding of 1.3 million class A shares and 3.3 million class B shares.
The total number of issued and outstanding ordinary shares following the rights issue and conversion will be 263 million class A shares and 262 million class B shares.
NOT FOR DISTRIBUTION IN THE UNITED STATES, CANADA OR JAPAN
Pelle Törnberg, President and CEO of Metro, commented: "This refinancing will provide Metro with an appropriate financial structure. The reduction of Metro's significant debt burden will enable the market to focus on the successful operational development of the business. The funds raised from the new issue of shares will be used to bring Metro's existing operations into a positive cash flow position".
Morgan Stanley has been appointed as adviser on the structuring of the refinancing and Carnegie has been appointed as Manager of the rights issue.
For further information, please visit www.metro.lu, email info@metro.lu or contact:
| Pelle Törnberg, President & CEO | tel: +44 (0) 20 7016 1300 |
| Matthew Hooper, Investor & Press Relations | tel: +44 (0) 20 7321 5010 |
NOT FOR DISTRIBUTION IN THE UNITED STATES, CANADA OR JAPAN
THESE MATERIALS ARE NOT AN OFFER FOR SALE OF THE SHARES IN THE UNITED STATES. THE SHARES MAY NOT BE SOLD IN THE UNITED STATES ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED. METRO INTERNATIONAL S.A. DOES NOT INTEND TO REGISTER ANY PORTION OF THE OFFERING IN THE UNITED STATES OR TO CONDUCT A PUBLIC OFFERING OF SHARES IN THE UNITED STATES.