REC ASA - Securing long-term financing

Sandvika, May 19, 2009; REC has today resolved to strengthen the company's financial position in order to ensure sufficient financial flexibility going forward. This will be done through; (i) restructuring of existing debt, (ii) adding new credit lines including a bond issue, and (iii) issuing new shares through a fully underwritten rights issue. The aggregate liquidity effect of the debt and equity measures will be in the range of NOK 7 - 9 billion.
 
In terms of debt, the company has successfully restructured existing debt and is adding new credit lines, including a bond issue, which in total are expected to amount to NOK 3 - 5 billion. REC has engaged DnB NOR Markets, Nordea and SEB as Joint Lead Arrangers for the bond issue. Offering a REC-bond to the financial market is in line with the strategy to diversify the company's sources of funding.
 
REC has also received an offer to revise financial covenants under the existing debt facilities.
 
In terms of equity, REC intends to complete an equity offering through issuance of new shares to raise approximately NOK 4 billion. The proposed equity offering will be conducted as a fully underwritten rights issue, to facilitate equal treatment of REC's more than 25,000 shareholders. The rights issue will, subject to certain conditions, be fully underwritten by REC's main shareholders Orkla/Elkem and Hafslund (with a percentage corresponding to their respective ownership interest) and other shareholders including Folketrygdfondet (together representing about 60 percent of outstanding shares), and a bank syndicate including DnB NOR Markets (acting as Global Coordinator and Joint Bookrunner), Nordea, ABN AMRO and BNP Paribas (acting as Joint Lead Managers and Bookrunners). Freely tradable subscription rights will be applied for listing on the Oslo Stock Exchange.
 
"Contact with our shareholders has indicated that our owners are highly supportive of the company taking action to ensure our long-term financial flexibility. Through new equity and significantly improved credit lines, we have taken the necessary steps to secure long-term financing of our ongoing capital expenditure program and provided a foundation for developing potential opportunities in a growing industry", says Ole Enger, President and CEO.
 
REC will call for an extraordinary general meeting ("EGM") to be held on June 5, 2009 to resolve the rights issue. According to the current timetable, and subject to approval by the EGM, the subscription period for the rights issue and the period for trading of subscription rights are expected to commence on or about June 12, 2009 and end on or about June 26, 2009. The company's shares are expected to be traded exclusive of subscription rights from and including June 8, 2009.
 
Terms of the rights issue, including the subscription price and the number of shares to be issued, will be proposed by the Board of Directors and are expected to be announced on or about June 5, 2009. The company will also prepare and publish a prospectus for the rights issue, which will be subject to approval by the Oslo Stock Exchange prior to publication.
 
For more information, please contact;
Bjørn Brenna, EVP & CFO, +47 900 43 186
Jon André Løkke, SVP & Investor Relation Officer, +47 907 44 949
 
About REC
REC is the leading vertically integrated player in the solar energy industry. REC Silicon and REC Wafer are among the world's largest producers of polysilicon and wafers for solar applications, and REC Solar is a rapidly growing manufacturer of solar cells and modules. REC Group had revenues of NOK 8,191 million and an operating profit of NOK 2,529 million in 2008. About 2,500 employees work in REC's worldwide organization. Please also see www.recgroup.com.
 
 
 
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This press release does not constitute or form part of an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended. The Company does not intend to register any portion of the offering of the securities in the United States or to conduct a public offering of the securities in the United States. Copies of this announcement are not being made and may not be distributed or sent into the United States, Australia, Canada, Hong Kong or Japan.