Target Information

Mutares has successfully listed its Nordic road maintenance platform, Terranor Group AB (publ), on Nasdaq First North Growth Market in Stockholm, partially realizing its investment while retaining a majority ownership stake. The recent offering involved the sale of 5 million existing shares at a price of SEK 20 per share, which accounts for 25% of the company's total shares. There is also an option for an additional 750,000 shares to be sold, which could elevate the total sale to 28.75% of the company's shares. The deal values Terranor at SEK 400 million, approximately €36 million.

Trading officially commenced on June 25, 2025, following a strong response from investors. The offering experienced high demand from both Swedish and international institutional investors as well as the public in Sweden and Denmark, leading to oversubscription multiple times over.

Industry Overview

The Nordic road maintenance industry is characterized by a robust demand for infrastructure improvements and management due to increasing urbanization and the necessity for sustainable public transportation systems. Governments in the region are investing heavily in public infrastructure to support economic growth and enhance mobility, reflecting national priorities for sustainability and efficiency.

In Sweden, the road maintenance sector has seen significant developments, fueled by a public commitment to environmental sustainability and an aging infrastructure that requires comprehensive refurbishment. The Swedish government’s strategic investments are expected to further guide sector growth, reflecting a commitment to enhancing road safety and efficiency.

Despite any challenges presented by economic fluctuations or shifts in funding, the need for consistent road maintenance remains critical. With a rising backlog in maintenance projects, particularly in the public sector, companies like Terranor are poised to benefit from increased contract opportunities and support from government initiatives aiming at long-term infrastructure investment.

Furthermore, the Danish road maintenance landscape complements the Nordic framework, demonstrating similar trends in infrastructure investment and public transportation system upgrades, creating opportunities for companies operating in both regions.

Rationale Behind the Deal

Mutares' decision to list Terranor not only reflects a successful strategy in managing and expanding its portfolio but also seeks to optimize capital through a public offering. By going public, Mutares can capitalize on investor interest in the growing infrastructure sector, thus attracting more attention to Terranor’s services and capabilities.

The anticipation of sustainable growth, driven by increasing demand for public infrastructure investments, makes this listing a strategic maneuver. The sale offers Mutares an opportunity to generate funds while maintaining significant ownership, which facilitates continued operational oversight and involvement in strategic decisions.

Investor Information

Mutares is a well-regarded investor in the European landscape, known for its effective management of portfolio companies and value creation through operational improvements and strategic acquisitions. Its hands-on approach positions it advantageously in the infrastructure sector, aligning closely with market demands and growth trends.

With its acquisition of Terranor in 2020 and the subsequent expansion in 2021, Mutares has demonstrated its capacity to enhance the operational efficiency and profitability of the companies within its portfolio. The investor’s commitment to the long-term ownership of Terranor underscores its confidence in the road maintenance market and the company’s potential for continued success.

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This investment by Mutares in Terranor is strategic and appears to be a sound long-term decision. The strong market demand for infrastructure services, coupled with a significant backlog of public-sector maintenance needs, provides a solid foundation for future growth. Mutares’ remaining 75% ownership after the listing indicates its belief in Terranor’s potential and the successful execution of its business model.

The implemented lock-up periods for Mutares and management ensure stability and signal commitment to the company’s growth trajectory. Additionally, Terranor's robust revenue figures and impressive adjusted EBIT indicate a well-performing company, supporting the notion that investing in this public listing was judicious.

Moreover, with public infrastructure investments becoming increasingly vital, investors in Terranor stand to gain from potential diversification and growth opportunities. The emphasis on infrastructure aligns with current governmental goals, positioning Terranor as a beneficiary of inevitable public financial support and investment.

In summary, this listing represents a well-calculated move for Mutares and holds promise for investors seeking exposure in the ongoing infrastructure expansion within the Nordic region.

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