Norofert Group closes private placement of corporate bonds in less than a day attracting 11,5 million lei from BVB investors
Bucharest, 22 January – Norofert SA, the leading Romanian producer of organic fertilizers, successfully closes its first private placement for corporate bonds and attracts 11,5 million lei from Bucharest Stock Exchange investors. The offer, which started on January 21st and closed the very same day amid high interest from investors and the oversubscription of the offer, was carried out using the auction model, under which the final interest rate is determined based on the demand from investors. The intermediary to the transaction was Tradeville, while Cornerstone Communications has handled Norofert’s investor relations.
102 investors have participated in the placement, with the average subscription being above 100,000 lei. During the offer, 115,000 corporate bonds with a nominal value of 100 lei and maturity of 5 years were put out for sale. The annual interest rate, to be paid half-yearly, has been stabilized at 8,5%. The company’s corporate bonds will float on the AeRO market of the Bucharest Stock Exchange under NRF25 symbol, with the exact date for the debut being subject to the admission to trading procedures, which will be managed by Tradeville.
„The fact that for the second time we have managed to raise the necessary capital in less than one day shows the potential that the Romanian capital market has and the opportunities it presents to local entrepreneurs. We decided to further finance our business through the stock exchange to reach three objectives – to raise the necessary capital for development, to do it transparently, and thirdly, to not decrease further our and other shareholders’ stake in the business. The corporate bonds were the best means of reaching these objectives and I would like to use this opportunity to thank all the investors who have participated in this second transaction, trusting Norofert with their capital” said Vlad Popescu, President of the Board at Norofert SA.
The capital raised during this private placement will be directed into our expansion of Norofert on the foreign markets, particularly in the United States. To enter the US market, Norofert needs to homologize all of its products individually, which requires significant resources. The rest of the amount will be directed into working capital, in order, among others, to purchase primary materials to meet the constantly growing demand for Norofert products as well as keep growing the portfolio of Norofert’s services and product lines. Norofert Group has currently three main business lines – Norofert Organics, which is a line of organic inputs for medium- to large-scale farming, Norofert Karisma, which is a line of fertilizers for large-scale conventional farming and FITO, a hobby gardening line that also targets small organic farmers.
“Tradeville has been the first intermediary to use an auction system of the Bucharest Stock Exchange, to establish the interest rate on the coupon. For Norofert’s placement, we have optimized the use of this system through our own trading platform, greatly simplifying the subscription process, which in the past has been bureaucratic and time consuming for the investors. As a premier in the market, our investors were able to participate in the offer by placing orders directly through the Tradeville mobile application. All in all, our mobile solutions have significantly improved the investor experience in the placement, with almost half of the total subscribed amount being raised in the first 30 minutes since launching the offer and the entire placement being subscribed on the first day” said Mihaela Biciu, CEO at Tradeville.
This is the second transaction in the capital markets for Norofert Group, which in July 2019 has raised 7,25 million lei from BVB investors during a private placement for shares which was also closed within less than one day. The capital raised in July 2019 has been directed into the launch and promotion of Karisma line, an extension of the team with 23 new employees as well as equipping and kickstarting the operations in the new factory in Filipesti de Padure. Following the investments, the production capacity at the factory has increased ten-fold and the financial performance of the company has been also positively impacted. In the first 10 months of 2019, Norofert has registered revenues of 11,5 million lei, an increase of 29% compared to the same period of 2018, and a net profit of 4 million lei, an increase of 8% compared to the same period of the previous year.
The preliminary financial results for full-year 2019 will be published by the company in February 2020, following the debut of Norofert shares on the AeRO market of the Bucharest Stock Exchange.
About Norofert SA
Norofert Group is a leading Romanian producer of organic agricultural products and an experienced player on the Romanian farming market. Established in 2000 as a family business, the company was initially the importer of high-quality fertilizers from Western markets to Romania. In 2015, with Vlad Popescu taking up the reins, the company has begun producing bio-fertilizers, organic phytosanitary products such as insecticides and fungicides as well as seed and foliar treatments using its original recipes. Between 2017 and 2019, the company has undergone rapid growth after developing a proprietary technology Bio Chain and launching a premiere in the agricultural sector, an effervescent tablet. Today, Norofert is a group of companies that include a line for organic farming (Norofert Organic), a line for conventional farming (Karisma) and a hobby gardening and small organic farmers line (Norofert Fito). In July 2019, Norofert has attracted 7,25 million lei from investors during the fastest ever private placement on the Bucharest Stock Exchange. Norofert shares will be tradable on the AeRO market of BVB under NRF ticker.