SKEL fjárfestingafélag hf.: Styrkás hf. Signs Heads of Terms for the Purchase of Hringrás ehf.

Today, Styrkás hf., a company 63.4% owned by SKEL fjárfestingafélag hf., today signed heads of terms for the acquisition of 100% of the shares in Hringrás ehf. The sellers in the transaction are TF II slhf., a venture capital fund managed by Landsbréf, which owns 60% of Hringrás, and Hópsnes ehf., which owns 40%. The proposed acquisition aligns with Styrkás’ strategy to establish environmental services as one of the company’s core business areas in the Icelandic economy.

The agreement values Hringrás at an enterprise value of ISK 6,300 million, with the potential to reach ISK 6,500 million if performance criteria are met. The equity value will depend on the net interest-bearing debt and estimated remaining investments as of the reference date. The entire purchase price will be settled through the issuance of new shares in Styrkás, with the share price reflecting an equity valuation of ISK 20,470 million for Styrkás. Following the acquisition, the sellers are expected to acquire a 9.7–10.7% stake in Styrkás.

Hringrás is projected to generate an estimated profit of ISK 244 million before depreciation, taxes, and financial items in 2024. The book value of Hringrás' fixed assets, post-investment, is estimated to range between ISK 6,200 million and ISK 6,400 million, while the company’s equity stands at ISK 2,300 million. Between 2021 and 2023, Hringrás' average annual earnings before depreciation (EBITDA) were nearly ISK 500 million. Upon the completion of site construction and the relocation of Hringrás' operations, the acquisition is based on the assumption that the company’s EBITDA will exceed ISK 1 billion.

The agreement is subject to several conditions, including the completion of due diligence, the signing of a purchase agreement, final approval by the board of directors and shareholders, and clearance from the Competition Authority.

Considering the transaction price, SKEL's estimated stake in Styrkás is valued at ISK 12,968 million. For comparison, the book value of SKEL's shareholding in Styrkás in its half-year financial results was ISK 9,684 million.

SKEL believes that Hringrás' operations and assets offer significant long-term opportunities in recycling and environmental sustainability, areas of growing importance for commercial enterprises. Additionally, Styrkás' acquisition of Hringrás supports its growth strategy and moves it closer to its goal of being publicly listed by the end of 2027

About Styrkás

Styrkás is a service company dedicated to supporting the Icelandic economy. The company has outlined a strategic plan for both organic and acquisition-based growth across five core sectors: energy and chemicals, machinery and equipment, environmental services, industrial operations, and asset management. Its portfolio includes leading companies such as Skeljungur, Klettur, and Stólpi Gámar. In 2023, the consolidated EBITDA of Styrkás’ group companies amounted to ISK 2.6 billion, with a net profit of ISK 1.2 billion after taxes.

The company’s shareholders aim to list all shares on a regulated market on the Iceland Stock Exchange by the end of 2027. Styrkás is led by CEO Ásmundur Tryggvason. For more information, visit the company’s website at www.styrkas.is.

Styrkás' advisors in this process are Akrar Consult and BBA // Fjeldco.

For further information, please contact Ásgeir Helgi Reykfjörð Gylfason, CEO fjarfestar@skel.is