Sika AG Launches CHF 1,500 Million Convertible Bonds Due 2025

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, ITALY OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.

The Bonds may be converted into new or existing shares of the Issuer (the "Shares"), starting from the earlier of (i) the 10th trading day (inclusive) following the registration with the commercial register of the resolutions passed by the Issuer's extraordinary general meeting (the "EGM" as communicated on May 11, 2018 by the Issuer), and (ii) the 3rd trading day following the end of the Fair Market Call Period (as defined below).

Should the EGM not resolve to approve the proposed creation of a single class of registered shares (Einheitsnamenaktien) or should such EGM resolutions not be registered with the commercial register of the Canton of Zug, or if the EGM does not take place on or prior to July 31, 2018 (the "Long Stop Date"), the Issuer may redeem at any time no later than 60 business days after the earlier of (x) the conclusion of the EGM and (y) the Long Stop Date (the "Fair Market Call Period") by giving notice to the Bondholders, all but not only some of the Bonds in cash at the greater of (i) 102% of the Issue Price (as defined below) and (ii) 102% of the fair bond value of the Bonds (the "Fair Market Call") as determined in accordance with the terms and conditions of the Bonds.

The Bonds are expected to carry a coupon between 0.00% and 0.30% per annum, and have a conversion price set at a premium of between 40.0% and 45.0% over the volume weighted average price (the "VWAP") of the Shares on the SIX Swiss Exchange between launch and pricing. The Bonds will be offered at a price of between 100% and 101% of their principal amount (the "Issue Price") and will
redeem at a price of 100% of the principal amount.

The Issuer may call the Bonds at any time on or after the 21st calendar day after the 5th anniversary of the Settlement Date at the relevant net principal amount, if the VWAP of the Shares is at least 130% of the conversion price on at least 20 out of 30 consecutive trading days.

The Bonds will be provisionally allocated to investors participating in today's book building. Such allocation of the Bonds will be subject to a pro-rata reduction relative to the number of advance subscription rights exercised by existing shareholders during the rights exercise period (the "Clawback").

Existing shareholders will be granted advance subscription rights to subscribe for the newly issued Bonds in proportion to their current shareholding, subject to selling restrictions. Each holder of 1 Bearer Share of the Issuer with a nominal value of CHF 0.60 will be allotted by the Issuer 6 Rights, and each holder of 1 registered share of the Issuer with a nominal value of CHF 0.10 will be allotted by the Issuer 1 Right. 204 Rights give the right to purchase from the Issuer 1 Bond at the Issue Price. The advance subscription rights will not be tradable. Advance subscription rights not exercised by existing Sika shareholders during the rights exercise period from May 18, 2018 until May 28, 2018, 12:00 noon (CEST), will expire and become null and void. Bonds for which advance subscription rights have been validly exercised will be deducted pro rata from the allocation to investors who participate in today's book building. Definitive allocations are expected to be announced by Sika on or around May 29, 2018.

The Offering of the Bonds consists of a public offering in Switzerland and private placements of Bonds to professional investors only in other jurisdictions. The Bonds will be offered to investors outside the United States of America (the "United States" or "US") in compliance with Regulation S under the US Securities Act of 1933, as amended, and in accordance with applicable securities laws, rules and regulations. The Bonds may not be offered or sold in the United States.

The Settlement of the Offering (the "Settlement Date") is expected to take place on June 5, 2018. Application for the listing and trading of the Bonds according to the Standard for Bonds of the SIX Swiss Exchange will be made.

The Issuer has agreed to a 90-day lock-up period from the Settlement Date.

The Issuer is rated A- (stable outlook) by Standard & Poor's. The Bonds are expected to be rated in line with the Issuer's corporate rating and the Issuer will apply for the Bonds to be rated by S&P.

UBS is acting as Sole Global Coordinator and Sole Bookrunner.

THIS PRESS RELEASE IS NOT BEING ISSUED IN THE UNITED STATES OF AMERICA (THE “UNITED STATES” OR “U.S.”) AND SHOULD NOT BE DISTRIBUTED TO UNITED STATES PERSONS OR PUBLICATIONS WITH A GENERAL CIRCULATION IN THE UNITED STATES. THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER OR INVITATION TO SUBSCRIBE FOR OR PURCHASE ANY SECURITIES NOR DOES IT CONSTITUTE A PROSPECTUS WITHIN THE MEANING OF ARTICLES 652A OR 1156 OF THE SWISS CODE OF OBLIGATIONS OR A LISTING PROSPECTUS PURSUANT TO THE LISTING RULES OF THE SIX SWISS EXCHANGE. ANY DECISION TO PURCHASE ANY SECURITIES REFERRED TO HEREIN SHOULD BE SOLELY BASED ON THE RELEVANT PROSPECTUS, WHICH IS EXPECTED TO BE PUBLISHED ON OR AROUND THE DATE HEREOF BY SIKA AG AND IS AVAILABLE FREE OF CHARGE AT UBS AG, PROSPECTUS LIBRARY, P.O. BOX, CH-8098 ZURICH, SWITZERLAND (TELEPHONE: +41 44 239 47 03, FAX: +41 44 239 69 14 OR EMAIL: [email protected]). IN ADDITION, NEITHER THE BONDS NOR THE SHARES OF SIKA AG INTO WHICH THE BONDS ARE CONVERTIBLE HAVE BEEN OR WILL BE REGISTERED UNDER THE UNITED STATES SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR DELIVERED WITHIN THE UNITED STATES OR TO U.S. PERSONS ABSENT FROM REGISTRATION UNDER OR AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE UNITED STATES SECURITIES LAWS.

THE INFORMATION CONTAINED IN THIS PRESS RELEASE IS NOT FOR PUBLICATION OR DISTRIBUTION IN CANADA, AUSTRALIA, JAPAN, ITALY OR IN ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION AND DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE IN CANADA, AUSTRALIA, JAPAN, ITALY OR IN ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.

IN THE UNITED KINGDOM, THIS PRESS RELEASE IS BEING DISTRIBUTED ONLY TO, AND IS DIRECTED ONLY AT, QUALIFIED INVESTORS (I) WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER") AND (II) WHO FALL WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER AND (III) TO WHOM IT WOULD OTHERWISE BE LAWFUL TO DISTRIBUTE IT (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").

IN ADDITION, IF AND TO THE EXTENT THAT THIS PRESS RELEASE IS COMMUNICATED IN, OR THE OFFER OF SECURITIES TO WHICH IT RELATES IS MADE IN, ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA")THAT HAS IMPLEMENTED DIRECTIVE 2003/71/EC, AS AMENDED (TOGETHER WITH DIRECTIVE 2010/73/EU, TO THE EXTENT IMPLEMENTED IN ANY EEA MEMBER STATE AND INCLUDES ANY APPLICABLE IMPLEMENTING MEASURES IN ANY EEA MEMBER STATE, THE “PROSPECTUS DIRECTIVE”) ("EACH, A "RELEVANT MEMBER STATE"), THIS PRESS RELEASE AND THE OFFERING OF ANY SECURITIES DESCRIBED HEREIN ARE ONLY ADDRESSED TO AND DIRECTED AT PERSONS IN THAT MEMBER STATE WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF THE PROSPECTUS DIRECTIVE (OR WHO ARE OTHER PERSONS TO WHOM THE OFFER MAY LAWFULLY BE ADDRESSED) AND MUST NOT BE ACTED ON OR RELIED ON BY OTHER PERSONS IN THAT MEMBER STATE.

IF LOCATED IN A RELEVANT MEMBER STATE, EACH PERSON WHO INITIALLY ACQUIRES ANY SECURITIES, AND TO THE EXTENT APPLICABLE ANY FUNDS ON BEHALF OF WHICH SUCH PERSON ACQUIRES SUCH SECURITIES THAT ARE LOCATED IN A RELEVANT MEMBER STATE, OR TO WHOM ANY OFFER OF SECURITIES MAY BE MADE WILL BE DEEMED TO HAVE REPRESENTED, ACKNOWLEDGED AND AGREED THAT IT IS A QUALIFIED INVESTOR AS DEFINED ABOVE.

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. 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 DIRECTIVE 2014/65/EU ("MIFID II"); (II) A CUSTOMER WITHIN THE MEANING OF DIRECTIVE 2002/92/EC ("IMD"), WHERE THAT CUSTOMER WOULD NOT QUALIFY AS A PROFESSIONAL CLIENT AS DEFINED IN POINT (10) OF ARTICLE 4(1) OF MIFID II; OR (III) NOT A QUALIFIED INVESTOR. CONSEQUENTLY NO KEY INFORMATION DOCUMENT REQUIRED BY REGULATION (EU) NO 1286/2014 (AS AMENDED, 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 IS UNLAWFUL UNDER THE PRIIPS REGULATION.

THIS PRESS RELEASE MUST NOT BE ACTED ON OR RELIED ON (I) IN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT RELEVANT PERSONS, AND (II) IN ANY MEMBER STATE OF THE EEA OTHER THAN THE UNITED KINGDOM, BY PERSONS WHO ARE NOT QUALIFIED INVESTORS.

IN THE CASE OF ANY SECURITIES BEING OFFERED TO YOU AS A FINANCIAL INTERMEDIARY AS THAT TERM IS USED IN ARTICLE 3(2) OF THE PROSPECTUS DIRECTIVE, YOU WILL ALSO BE DEEMED TO HAVE REPRESENTED AND AGREED THAT THE SECURITIES ACQUIRED BY YOU IN THE OFFERING HAVE NOT BEEN ACQUIRED ON BEHALF OF PERSONS IN THE EEA OTHER THAN QUALIFIED INVESTORS OR PERSONS IN THE UNITED KINGDOM AND OTHER MEMBER STATES (WHERE EQUIVALENT LEGISLATION EXISTS) FOR WHOM YOU HAVE AUTHORITY TO MAKE DECISIONS ON A WHOLLY DISCRETIONARY BASIS, NOR HAVE THE SECURITIES BEEN ACQUIRED WITH A VIEW TO THEIR OFFER OR RESALE IN THE EEA WHERE THIS WOULD RESULT IN A REQUIREMENT FOR PUBLICATION BY THE ISSUER, THE SOLE BOOKRUNNER OR ANY OTHER PERSON OF A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE, OR IN WHICH THE PRIOR CONSENT OF THE SOLE BOOKRUNNER HAS BEEN OBTAINED TO SUCH OFFER OR RESALE.

THIS PUBLICATION MAY CONTAIN SPECIFIC FORWARD-LOOKING STATEMENTS, E.G. STATEMENTS INCLUDING TERMS LIKE "BELIEVE", ASSUME", "EXPECT", "FORECAST", "PROJECT", "MAY", "COULD", "MIGHT", "WILL" OR SIMILAR EXPRESSIONS. SUCH FORWARD-LOOKING STATEMENTS ARE SUBJECT TO KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY RESULT IN A SUBSTANTIAL DIVERGENCE BETWEEN THE ACTUAL RESULTS, FINANCIAL SITUATION, DEVELOPMENT OR PERFORMANCE OF THE COMPANY AND THOSE EXPLICITLY OR IMPLICITLY PRESUMED IN THESE STATEMENTS. AGAINST THE BACKGROUND OF THESE UNCERTAINTIES, READERS SHOULD NOT RELY ON FORWARD-LOOKING STATEMENTS. SIKA AG ASSUMES NO RESPONSIBILITY TO UPDATE FORWARD-LOOKING STATEMENTS OR TO ADAPT THEM TO FUTURE EVENTS OR DEVELOPMENTS.