ams launches offering by way of private placement of approx. EUR 750 million convertible bonds due 2027 ...

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ams launches offering by way of private placement of approx. EUR 750 million convertible bonds due 2027; pre-announces third quarter results for ams business with revenues of USD 564 million and adjusted EBIT margin of 23%, both towards top end of expected range; expects further robust sequential growth for ams business in fourth quarter with revenues of USD 650-690 million and firmly higher operating profitability

• Final terms of the Offering to be announced after an accelerated bookbuilding process expected to be finalised on 27 October 2020
• Planned transaction contributes to a diversified, long-term funding structure maximizing financial flexibility for ams while paving the way towards full integration of OSRAM
• Third quarter results for ams business show revenues of USD 564 million and adjusted EBIT margin of 23%, both towards the top end of the expectation range
• Expecting strong ams business in the fourth quarter with expected revenues of USD 650-690 million and adjusted EBIT margin of 24-27%, both firmly up quarter-on-quarter

Premstaetten, Austria (27 October 2020) -- ams (SIX: AMS), a leading worldwide supplier of high performance sensor solutions, announces that its Management Board has resolved today, with the consent of the Supervisory Board, the launch of an offering by way of private placement (the "Offering") of approx. EUR 750 million of guaranteed convertible bonds due 2027 (the "Bonds"). The net proceeds of the Bonds will be used for general corporate purposes. Prior to the settlement of the issuance of the Bonds, ams will cancel out the existing bridge facilities by using available cash. In addition to issuance of the Bonds, ams has negotiated and agreed the terms of a new EUR 750 million bridge facility with a consortium of banks to be entered into on or after the settlement of the issuance of the Bonds.

The issuance of the Bonds and new bridge facility will together serve to secure comprehensive funding to implement the domination and profit and loss transfer agreement with OSRAM (following approval by the shareholders) as well as subsequent steps in order to realize the full integration of OSRAM. In line with ams' long-term funding strategy and prudent balance sheet management, the above-mentioned transactions will complement the term profile of existing debt and maximize financial flexibility for ams.

At this time, ams pre-announces third quarter 2020 results for the ams business excluding OSRAM showing high quarter-on-quarter revenue growth to USD 564 million and very good profitability with an adjusted EBIT margin of 23%, both towards the top end of the stated expectation range. These robust results were particularly driven by continued strength in ams' consumer business despite the macroeconomic effects of the Covid-19 pandemic and negative exchange rate developments in the quarter.

ams also provides a financial outlook for the fourth quarter 2020 comprising the ams business only, based on currently available information. ams sees strong business momentum continuing in the fourth quarter given significant seasonal ramps and resilient demand in ams’ consumer business, notwithstanding the ongoing global pandemic and related economic uncertainties. Improving demand trends are taking hold in ams’ automotive, industrial and medical businesses comple-menting this development. ams therefore expects fourth quarter revenues of USD 650-690 million for the ams business, up 19% sequentially and 2% year-on-year at the midpoint, while adjusted EBIT margin is expected to grow meaningfully quarter-on-quarter to 24-27% of revenues. ams will be fully consolidating OSRAM as of the beginning of the third quarter 2020 and intends to show OSRAM as a separate reporting segment. As previously announced, ams will publish full consolidated third quarter results including OSRAM on 6 November 2020.

The Bonds will have a maturity of 7 years, will be issued at 100% of their principal amount and, if not converted, will be redeemed at 100% of their principal amount subject to the share redemption option in accordance with the terms and conditions of the Bonds. The Bonds are expected to bear interest at a rate between 1.875% and 2.375% per annum, payable semi-annually in arrear, subject to a step-up if certain conditions are not satisfied.

The Bonds will be convertible into new or existing ordinary no par value bearer shares equal to up to 10% of the current issued share capital. Subscription rights of existing shareholders of ams to subscribe to the Bonds have been excluded. The Bonds will be offered with a conversion premium of between 45% and 50% above the reference share price, being the volume-weighted average price of the Shares on SIX Swiss Exchange between launch and pricing translated into EUR at the prevailing exchange rate. ams will be entitled to redeem the Bonds at their principal amount plus accrued interest in accordance with the terms and conditions of the Bonds at any time (i) on or after 6 December 2024 if the price of the ams share is equal to or exceeds 130% of the prevailing conversion price over a certain period, or (ii) if 20% or less of the aggregate principal amount of the Bonds remain outstanding.

Pricing is expected to take place later today following an accelerated bookbuilding process with settlement on or around 3 November 2020. The Bonds will be offered only to institutional investors outside the U.S. in reliance on Regulation S (Category 2) under the United States Securities Act of 1933 as amended, as well as outside Australia, Canada, Japan, South Africa or any other jurisdiction in which offers or sales of the securities would be prohibited by applicable law and will not be offered to any U.S. persons.

ams has agreed to a lock-up period expiring 90 days after the date on which the Bonds are issued subject to customary exceptions. An application will be made for the Bonds to be included on the Open Market segment (Freiverkehr) of the Frankfurt Stock Exchange.

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Disclaimers

The Bonds may not be publicly offered, directly or indirectly, in Switzerland within the meaning of the Swiss Financial Services Act ("FinSA") and no application has or will be made to admit the Bonds to trading on any trading venue (exchange or multilateral trading facility) in Switzerland. This announcement does not constitute a prospectus pursuant to the FinSA or pursuant to the Swiss Code of Obligations (as in effect immediately prior to the entry into force of the FinSA) or pursuant to the listing rules of SIX Exchange Regulation or any other trading venue in Switzerland.

This announcement may not be published, distributed or transmitted, directly or indirectly, in the United States of America (including its territories and possessions), Japan, Australia, South Africa or any other jurisdiction where such announcement could be unlawful. The distribution of this announcement may be restricted by law in certain jurisdictions and persons who are in possession of this document or other information referred to herein should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

This announcement does not constitute an offer of, or a solicitation of an offer to purchase, securities of the company or of any of its subsidiaries in the United States of America, Germany, Austria or any other jurisdiction. Neither this announcement nor anything contained herein shall form the basis of, or be relied upon in connection with, an offer in any jurisdiction. The securities offered will not be and have not been registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") and may not be offered or sold in the United States or to any U.S. person absent registration or an applicable exemption from the registration requirements under the Securities Act.

In the United Kingdom, this announcement is only directed at persons who (i) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order") or (ii) are persons falling within Article 49(2)(a) to (d) of the Order (high net worth companies, unincorporated associations, etc. (all such persons together being referred to as "Relevant Persons")). This document must not be acted on, or relied upon, by persons who are not Relevant Persons. Any investment or investment activity to which this document relates is available only to Relevant Persons and will be engaged in only with Relevant Persons.

In member states of the European Economic Area the placement of securities described in this announcement is directed exclusively at persons who are "qualified investors" within the meaning of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 (Prospectus Regulation).

The Bonds are not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise made available to any retail investor in the EEA or the UK. For these purposes, a "Retail Investor" means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of MIFID II; (ii) a customer within the meaning of Directive (EU) 2016/97 (as amended, the "Insurance Distribution Directive"), where that customer would not qualify as a professional client as defined in point (10) of article 4(1) of MIFID II. Consequently, no key information document required by Regulation (EU) No 1286/2014 (the "PRIIPs Regulation") for offering or selling the Bonds or otherwise making them available to retail investors in the EEA has been prepared and therefore offering or selling the Bonds or otherwise making them available to any retail investor in the EEA or the UK may be unlawful under the PRIIPs Regulation.

No action has been taken that would permit an offering or an acquisition of the securities or a distribution of this announcement in any jurisdiction where such action would be unlawful. Persons into whose possession this announcement comes are required to inform themselves about and to observe any such restrictions.

This announcement does not constitute a recommendation concerning the placement. Investors should consult a professional advisor as to the suitability of the placement for the person concerned.

This release may contain forward looking statements, estimates, opinions and projections with respect to anticipated future performance of the company ("forward-looking statements"). These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes," "estimates," "anticipates," "expects," "intends," "may," "will" or "should" or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. Forward-looking statements are based on the current views, expectations and assumptions of the management of the company and involve significant known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Forward-looking statements should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not such results will be achieved. Any forward-looking statements included herein only speak as at the date of this release. We undertake no obligation, and do not expect to publicly update, or publicly revise, any of the information, forward-looking statements or the conclusions contained herein or to reflect new events or circumstances or to correct any inaccuracies which may become apparent subsequent to the date hereof, whether as a result of new information, future events or otherwise. We accept no liability whatsoever in respect of the achievement of such forward-looking statements and assumptions.