AS VALMIERAS STIKLA ŠĶIEDRA announces commencement of due diligence process at US facility

9. May, 2019

The Management Board of AS VALMIERAS STIKLA ŠĶIEDRA (the ‘Company’, with registration no: 40003031676, legal address: Cempu iela 13, Valmiera, LV-4201), hereby announces that P-D VALMIERA GLASS USA Corp., the majority-owned US subsidiary (‘US subsidiary’) of the Company has received an approach to potentially acquire its Phase 2 facility (the vertically-integrated fibreglass yarn producing operation). 

The Shareholders of the US subsidiary have signed an exclusivity agreement (the ‘Agreement’) with an unrelated third party. The conditions of the Agreement preclude the Company from disclosing their identity. A due diligence process has commenced and it is foreseen that it will be ongoing until the end of May 2019. The Company emphasizes that no decision about the sale of the Phase 2 operations of the US subsidiary has been taken. This is only possible after the results of the due diligence process are known and the counterparty has provided a firm proposal.

Management comment: Coinciding with the unexpected approach from a potential buyer and considering that the Phase 2 operations have taken a longer than expected time to reach expected output levels, the Company has been examining all routes (including a potential disposal) to find the best way to foster shareholder value. 

It is important to note that the Company does not have any plans to sell nor otherwise dispose of the Phase 1 operations: a needle matting facility. This can operate as an independent enterprise and has been consistently performing in line with management’s expectations since inception.

Further details are therefore expected to be available after the completion of the due diligence process.