OMV has successfully closed two major capital markets transactions

June 10, 2011 - 12:45 pm (CET)

• OMV has closed capital increase and hybrid bond transaction
• Total proceeds of EUR 1.5 bn lead to expected equity credit of EUR 1.1 bn from rating agencies
• Transactions bring us significantly closer to our long-term gearing target   of 30%

On May 16, OMV announced its intention to launch two capital markets transactions to reduce its gearing level and refinance the acquisitions of an additional 55.40% interest in Petrol Ofisi and two Tunisian exploration and production subsidiaries from Pioneer Natural Resources. After a successful marketing period, both the EUR 750 mn subordinated hybrid bond transaction and the EUR 750 mn capital increase (net proceeds of EUR 725 mn) have now closed.

The capital increase was successfully completed with the placement of 27.3 mn shares, or 9.09% of OMV’s share capital, at a subscription price of EUR 27.50 on June 6, 2011. Existing shareholders have strongly supported the capital increase with a take-up of approx. 65% of their subscription rights. The OMV core shareholders ÖIAG and IPIC fully exercised their subscription rights and therefore maintain their stakes in OMV of 31.5% and 20.0%, respectively.

Gerhard Roiss, Chief Executive Officer of OMV, commenting on the capital increase, said: "The strong investor support for the capital increase demonstrates that the market believes in OMV’s future growth potential. Increasing our stake in Petrol Ofisi and acquiring the two Tunisian subsidiaries from Pioneer Natural Resources will enhance our operational platform and growth profile and this has clearly been understood by the market. We are currently in a strategy review process, but it’s already clear today, that the future will bring a reduction in the complexity of our businesses with an even stronger focus on Exploration and Production. We will present this in detail at our Capital Markets Day and Media Summit in September in Istanbul."

The hybrid bond issuance was also successfully completed with an issue size set at EUR 750 mn on May 25, 2011. Due to the high demand from institutional and retail investors, the order book size exceeded EUR 2.4 bn. The hybrid notes have no scheduled maturity date and bear a fixed interest rate of 6.75% until April 26, 2018. OMV has the option to call the notes for the first time on April 26, 2018, then again on April 26, 2023 and annually thereafter on every interest rate payment date. Interest payments are deferrable at OMV’s discretion. The hybrid bond is structured to achieve 50% equity credit from Moody’s and Fitch. Under IFRS, the hybrid bond is treated as 100% equity. OMV is currently rated A3 by Moody’s and A- by Fitch. The hybrid bond received a rating of Baa3 by Moody’s and of BBB by Fitch.

David Davies, Chief Financial Officer of OMV, said: "Our ability to raise capital in the hybrid market has allowed us to raise equity-like capital and therefore reduce the size of the capital increase and potential dilution of our existing shareholders whilst, at the same time, reducing our leverage to a level much closer to our long-term gearing target of 30%. The price we were able to achieve in this inaugural hybrid bond transaction highlights the underlying financial strength of the Group."

Background information

OMV Aktiengesellschaft
With Group sales of EUR 23.32 bn and a workforce of 31,398 employees in 2010, OMV Aktiengesellschaft is one of Austria’s largest listed industrial companies. In Exploration and Production, OMV is active in two core countries Romania and Austria and holds a balanced international portfolio. OMV had proven oil and gas reserves of approximately 1.15 bn boe as of year-end 2010 and a production of around 318,000 boe/d in 2010. In Gas and Power, OMV sold approximately 18 bcm of gas in 2010. In Refining and Marketing, OMV has an annual refining capacity of 22.3 mn t and as of year-end 2010 approximately 4,800 filling stations in 13 countries including Turkey. In Austria, OMV operates a 2,000 km long gas pipeline network with a marketed capacity of around 89 bcm in 2010. With a trading volume of around 34 bcm in 2010, OMV’s gas trading platform, the Central European Gas Hub, is amongst the most important hubs in Continental Europe. OMV further strengthened its position through the ownership of a 96% stake in Petrol Ofisi, Turkey’s leading company in the retail and commercial business.

Under its 3plus strategy, OMV combines the strengths of its E&P, G&P and R&M business units in order to ensure that it provides the best possible supply service to its three core markets of Central and Eastern Europe, Southeast Europe and Turkey. OMV uses the synergies that result from the combination of these strengths to extend its supply chain from oil and gas through to electricity and eventually renewable energy.

Sustainability
OMV is a signatory to the UN Global Compact, and an active supporter to the values enshrined in its Code of Conduct. These include a strong sense of responsibility towards the social and natural environment, especially in economically weak regions. OMV continuously addresses economic, environmental and social issues related to its business in a responsible manner. The company reports on its activities in a sustainability report in accordance with the Global Reporting Initiative Guidelines.