Oct 11, 2018

NRC Group ASA acquires VR Track Oy to form the leading rail infrastructure company in the Nordics

NRC Group ASA (“NRC Group”) has entered into an agreement for the acquisition of VR Track Oy ("VR Track"), a Finnish company in the VR Group engaged in the business of railway construction, maintenance services and design with operations in Finland and Sweden (the "Transaction").

The key terms of the Transaction are as follows:

  • The Transaction will be structured as an acquisition of all shares in VR Track by a newly established and wholly owned Finnish subsidiary of NRC Group, from VR Group Oy (registered name VR-Yhtymä Oy) ("VR Group").
  • The purchase price is based on an enterprise value of VR Track of EUR 225 million on a cash and debt free basis with normalised working capital.
  • 65% of the purchase price shall be paid in cash by NRC Group while the remaining 35% of the purchase price shall be paid in the form of consideration shares in NRC Group at an agreed price per consideration share of NOK 75.31. The share price represents the volume weighted average price of the NRC Group share on Oslo Børs the last thirty trading days prior to signing. The cash portion of the purchase price will be fully financed by available cash and new bank debt facility.
  • VR Group will obtain an ownership in NRC Group representing around 18% of the total number of issued shares in NRC Group following completion of the Transaction. NRC Group will seek to facilitate representation by VR Group on the board of directors of NRC Group.
  • VR Track estimates to generate approximately EUR 300 million in net sales, EUR 28 million in EBITDA and incur capex of EUR 4 million in 2018. The majority of profits are generated in Finland.
  • Completion of the Transaction is conditional upon anti-trust approval in Sweden, certain regulatory approvals in Finland, approval by an extraordinary general meeting of NRC Group as well as certain other customary closing conditions.
  • The Transaction will be presented at an extraordinary general meeting of NRC Group, expected to be held early November 2018 (the "EGM"), and a notice of the EGM is expected to be distributed and published shortly. Approval of the Transaction requires at least two-thirds majority of the votes cast and of the share capital represented at the EGM.
  • Closing of the Transaction is expected to take place in early January 2019, subject to satisfaction of the closing conditions.

“We will double in size and significantly strengthen our market position, paving the way for further steady growth”, says Øivind Horpestad, CEO of NRC Group.

Transport infrastructure involving rail is crucial for modern societies to develop and thrive. All Nordic countries are investing heavily in new railways, metro and tram connections as part of their efforts to build more environmentally friendly and sustainable transportation systems. With a broader operational scope and synergies, the combined company will be in a favourable position to capitalise on these positive market trends.

“Our two companies are complementary in terms of market position, capacities and capabilities. We will offer services across the entire value chain, including design, ground works, track, security, electro, telecom and signalling systems, and exciting new opportunities will emerge. Furthermore, the combined company will further strengthen its focus on environmental, social and governance initiatives (ESG). Both companies are based upon common Nordic values, where a sustainable and responsible approach to the way we solve our projects and how we act together with our clients, employees and all other stakeholders, is high on our agenda”, Horpestad explains.

Strategic rationale

The combination of NRC Group and VR Track will create the leading specialized rail infrastructure company in the Nordics, with strong capabilities across the entire railway value chain and leading positions in the attractive Norwegian, Swedish and Finnish markets. NRC Group and VR Track are two complementary businesses, and the combined operations will be stronger and more competitive than each company stand-alone. The enlarged NRC Group will be able to leverage its unique capabilities across borders to create new project opportunities and offer larger turnkey projects to a wider customer group.

There are significant long-term growth opportunities across all three key markets on the back of political willingness to upgrade existing infrastructure and invest in new railways. With a broader operational scope and synergies, the combined company will be in a favourable position to capitalize on these positive market trends and further grow the already strong cash flow of both NRC Group and VR Track’s existing operations.


The Transaction will create several exciting opportunities for the combined company, including:

  • Stronger ability to capitalize on the trend towards maintenance projects in both Norway and Sweden on the back of VR Track’s extensive experience from such contracts in Finland and Sweden
  • Greater capacity and sufficient machinery to take on more projects
  • Increased utilization of VR Track’s machine pool
  • Stronger platform for growth and better utilization of resources in Sweden
  • Leveraging unique capabilities across borders, such as city infrastructure construction in Finland, design projects in Norway and environmental services in Sweden and Finland

Overview of the Finnish rail infrastructure market

The Finnish rail infrastructure market exhibits similar characteristics as Norway and Sweden, with urbanisation, focus on the environment and sustainability as well as historical underinvestment and maintenance backlog. As a result, the Finnish market is expected to grow by an average annual growth rate of 8% from 2017 to 2022.

The framework for rail infrastructure spending is set by parliament over four-year parliament periods. However, preparatory work has been initiated to develop 12-year transportation plans similar to Norway and Sweden, which would provide further visibility on long-term growth prospects.

Key facts about VR Track

VR Track is a private limited liability company (Finnish: osakeyhtiö) incorporated in Finland, with business ID 1007822-3. VR Track’s registered office and principal place of business is at Radiokatu 3, 00240 Helsinki, Finland. VR Track owns 100% of the Finnish subsidiary Arcus Oy and the Swedish subsidiaries VR Track Sweden AB and VR Infrapro AB.

VR Track is wholly owned by VR Group, which in turn is wholly owned by the State of Finland.

VR Track, including its subsidiaries, currently has approximately 1600 employees. The board of directors of VR Track Oy currently consists of Rolf Jansson, Ilkka Heiskanen, Marko Hyvärinen and Timo Koskinen, all being representatives of VR-Group Ltd. A new board of directors of VR Track will be established in connection with completion of the Transaction

Key financial information for VR Track

The tables below set out selected data from VR Track’s audited income statement and balance sheet for the years ended 31 December 2015, 2016 and 2017, and management accounts for the last twelve months ended 30 June 2018.

Income statement

The financial performance of VR Track in 2016 was negatively impacted by one-off losses related to certain projects in Sweden. These loss-making projects have been terminated.

(in EUR millions) 2015 2016 2017 LTM 2018 2018E
Net sales            306,6            298,9            306,2            299,7            300,0
EBITDA              23,7              (7,8)              22,9              24,2              28,0
Depreciation and amortisation              (5,6)              (6,3)              (6,1)              (6,4)              (8,0)
EBIT              18,1            (14,1)              16,8              17,8              20,0

Balance sheet

(in EUR millions) 31 Dec-15 31 Dec-16 31 Dec-17 30 Jun-18
Fixed assets          41,2          33,9          28,9          31,6
Inventories            20,6            15,8            16,2            19,6
Receivables            99,8            86,6            76,0            75,3
Cash            53,1            30,9            31,2            17,0
Current assets        173,5        133,3        123,3        111,9
Total assets        214,7        167,2        152,3        143,4
Equity          88,0          55,5          54,4          55,8
Provisions and deferred tax            5,5            7,6            4,6            3,5
Other long term interest bearing debt            21,8            (0,0)            0,0            0,0
Leasing liabilities              -                -                -              6,1
Intra group loan            12,9            6,4            7,7            8,1
Group contribution            13,8            17,1            17,4            17,4
Trade payables & other liabilities            72,7            80,6            68,1            52,6
Total equity and liabilities        214,7        167,2        152,3        143,4

Order book

As of June 30, 2018, VR Track had an order book of EUR 401 million.

Other key information related to the Transaction

No agreements have been or are expected to be entered into with the executive management or members of the boards of directors of NRC Group or VR Track entitling them to any special benefits in connection with the Transaction.

NRC Group will publish a document with further information regarding the Transaction in accordance with the requirements of Oslo Børs’ Continuing Obligations section 3.5. Such document is expected to be published in the second half of November 2018.

Investor presentation

An investor presentation will be held Friday 12 October 2018 at 09:00 a.m. (CET) at Arctic Securities offices, Haakon VIIs gt 5, Oslo. The presentation will be held by NRC Group’s CEO Øivind Horpestad and CFO Dag Fladby.

If you wish to attend the presentation, please register by email to events@arctic.com.


Arctic Securities AS acts as financial adviser and Advokatfirmaet Schjødt AS acts as lead legal adviser to NRC Group in connection with the Transaction.

Nordea Bank AB acts as financial adviser and Krogerus Attorneys Ltd. acts as lead legal adviser to VR Group in connection with the Transaction.


For further information please contact: CEO Øivind Horpestad, telephone: +47 91 00 06 26,

Important information

This stock exchange release contains certain forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty, as they reflect current expectations and assumptions as to future events and circumstances that may not prove accurate. A number of factors could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements.

This stock exchange release is not for distribution, directly or indirectly, in or into the United States, Canada, Australia, Japan or any other jurisdiction in which such distribution would be unlawful or would require registration or other measures.

This stock exchange release does not constitute an offer for sale of securities in any jurisdiction. The securities mentioned herein have not been, and will not be, registered under the United States Securities Act of 1933 (the "U.S. Securities Act"), and may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the U.S. Securities Act. There will be no public offer of securities in the United States.

This information is subject of the disclosure requirements according to section 5-12 of the Norwegian Securities Trading Act.

Contact us

Henning Olsen

Henning Olsen


+47 91 74 15 92

  • NRC Group - Acquisition of VR Track Presentation

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