BRAIN AG announces Intention to Float

DGAP-News: B.R.A.I.N. Biotechnology Research And Information Network AG /
Key word(s): IPO

2016-01-05 / 08:00
The issuer is solely responsible for the content of this announcement.

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PRESS RELEASE

BRAIN AG announces Intention to Float

  - First German company from the field of Bioeconomy plans an Initial
    Public Offering on the Frankfurt stock exchange with admission to the
    Prime Standard

  - BRAIN develops bio-industrial product solutions for globally active
    industrial partners and for its own commercialisation

  - BRAIN promotes as key enabler the "Biologisation of Industries"

  - Planned IPO will allow BRAIN to accelerate the commercialisation of its
    own product pipeline and to promote its successfully initiated
    industrialisation strategy

  - Special subscription programme for retail investors

Zwingenberg, January 05, 2016: B.R.A.I.N. Biotechnology Research and
Information Network AG ("BRAIN AG", "the Company" and together with its
subsidiaries "BRAIN" or "the Group") is preparing an initial public
offering ("IPO" or "the Offer") in the Regulated Market (Prime Standard) of
the Frankfurt Stock Exchange.

BRAIN AG is one of Europe's leading technology companies in the field of
industrial biotechnology, the core discipline of the Bioeconomy. Using
proprietary technology platforms, the Company identifies previously
untapped, efficient enzymes, microbial producer organisms or bioactive
natural substances from all that biodiversity has to offer to put them into
industrial or rather bioeconomical use. The innovative product solutions
developed by the help of this "Toolbox of Nature" are successfully applied
in the chemical industry as well as in the consumer goods, cosmetics,
animal feed, and food industries. To secure its technologies and product
candidates, BRAIN AG holds more than 350 patents and patent applications
divided in 48 patent families.

Clearly focussed business model 

BRAIN's business is based on two pillars - "BioScience" and
"BioIndustrial".

The "BioScience" pillar comprises the Company's - frequently exclusive -
collaboration business with selected globally active industrial partners.
Since its foundation, BRAIN AG has successfully entered into more than 100
of such long-lasting industrial partnerships. Basically, these involve
BRAIN providing research and development services aimed at sustainably
improving processes or at identifying new products and technical solutions
harnessing the methods of industrial biotechnology. To this end, the
Company receives a combination of running research and development fees,
milestone payments, performance payments and license fees from the
respective industrial partner. Among these collaboration partners are
companies such as BASF, Bayer, Clariant, DSM Nutritional Products, Evonik,
Fuchs Europe, Henkel, Nutrinova, RWE, Südzucker, or Symrise.

The second pillar of BRAIN's business, "BioIndustrial", comprises the
development and commercialisation of its own products and active product
components. In order to promote the underlying industrialisation strategy,
BRAIN AG targets rapidly growing market segments such as enzymes, food,
wound care, or BioSubstitutes (biological substituents for chemical
ingredients) as well as cosmetics and care products within the consumer
goods market. For these target markets, the Company has built an extensive
product pipeline intended to contribute significantly to its future sales
growth.

These products and active product components are either marketed by
granting licenses to third parties or by acquiring companies which are
already active in the relevant markets. In this pillar of the business,
BRAIN thus participates in the market through own product sales, or by
license payments and royalty payments linked to the licensee's final
product sales.

In fiscal year 2014/15, the Company has acquired a majority interest in a
well-established manufacturing and sales company - WeissBioTech - for the
enzyme and food target markets. In earlier years, BRAIN AG had already
acquired two other industrial enterprises providing both the required
manufacturing capacities and market access to end consumers (B2B, B2C)
within the market for cosmetics and care products.

Consistent growth strategy

More than 20 years of experience in the industrial collaboration business
have paved the way for BRAIN AG's consistent expansion over the past few
years. During the same time period, BRAIN has established robust contacts
to the industry, the scientific and academic community and political bodies
in order to be accepted and act as a key enabler in the change towards a
bio-based economy.

After the adoption of its industrialisation strategy in 2008, the Company
had a special focus on investing into and scaling up its own product
pipeline. In addition, the Company was sustainably strengthened through
selective corporate acquisitions which were successfully integrated into
the value chain and well positioned in attractive markets.

BRAIN's strong growth path is also reflected in the Company's financial
development. The Group's operating performance (sales revenues + changes in
finished goods and work in progress + other income including R&D grants)
increased by a compound annual growth rate of 59 per cent, from EUR 10.2m
to EUR 25.7m, between the 2012/13 and the 2014/15 fiscal years. A
significant portion of this growth is attributable to the "BioIndustrial"
division, where the operating performance increased by an average of 68 per
cent per annum from EUR 4.8m to EUR 13.5m, over the same period.
Consequently, already today, this business pillar accounts for more than
half (53 per cent in fiscal year 2014/15) of the Group's operating
performance. The Group's EBIT remained almost stable in absolute numbers,
with EUR -4.4m in 2012/13 and EUR -4.6m in 2014/15, while margins improved
over time. The different relations between the absolute revenue and
earnings developments is due to the significant increase of Research &
Development capabilities on the one hand, and the initial consolidation of
WeissBioTech on the other hand, which does not yet include the expected
earnings potential from the use of BRAIN's product pipeline.

BRAIN AG sees future growth opportunities mainly in the expansion of its
BioArchive, the so-called "Toolbox of Nature". This is how the Company
intends to secure additional rights to use and exploit biotechnology
solutions. In addition, the Company continues to pursue its "multi-product
opportunity" approach, which is based on the fact that one innovative
solution developed by BRAIN may often be used and monetised in different
market segments in parallel.

Finally, BRAIN AG plans to further expand its business activities in the
"BioScience" division with its collaboration partnerships. It also aims to
extend its "BioIndustrial" activities on a more global scale, i.e. beyond
the German-speaking countries and Europe.

To be prepared for this next level of growth especially in view of the
additional tasks in the product business, the BRAIN management team has
been strengthened and equipped with more responsibilities during the last
year. The Management Board, led by its Chairman Dr Jürgen Eck, who belongs
to the group of BRAIN shareholders since 1994, was complemented by Henricus
Marks (COO), who has more than 25 years of industry experience, in
particular in global sales operations and key account management
particularly in the enzyme business. In addition, Dr Georg Kellinghusen,
former member of the BRAIN Supervisory Board, was appointed CFO with effect
from January 01, 2016. The experienced management team, now consisting of
ten people, is highly motivated to make a significant contribution for
BRAIN and the biological transformation of the target industries.

Offer for institutional and private investors

The planned offer primarily consists of newly issued shares from a capital
increase; meaning, the Company will receive all the proceeds from these
primary shares. Besides, one existing shareholder is planning to provide
shares to be used in an over-allotment option.

ODDO Seydler Bank AG is acting as Sole Global Coordinator and Bookrunner in
the transaction. Blaettchen Financial Advisory GmbH is supporting the
Company as IPO consultant.

Some 51 per cent of BRAIN AG's current equity capital is held by the family
office of MP Beteiligungs GmbH and around 20 per cent is owned by MIG, a
group of venture capital funds. The remaining around 29 per cent are
primarily in the possession of the Company's founders and senior
management. These existing shareholders will continue to hold a significant
equity portion after the planned IPO.

The Offer will consist of initial public offerings in Germany and Austria
as well as private placements in certain jurisdictions outside of these
countries and outside the United States of America. With the aim to
adequately target retail investors, BRAIN wants to reserve some 10 per cent
of the offered shares for this group of investors. Plans are being made to
provide dedicated subscription channels - also via the Company itself - for
this particular purpose.

"Over the past few years, we have built up an excellent reputation within
the research community, political bodies and the relevant industry players,
and have realised successful collaboration projects. We have also made good
progress with our industrialisation strategy - thanks to successfully
integrated acquisitions on the one hand and the expansion of our product
pipeline on the other hand. Now we are ready to increase our independence
on the financing side, in order to properly benefit from the tailwinds in
our industry. The planned IPO will bring the expansion of our Company an
important step forward", says Dr Jürgen Eck, Chief Executive Officer of the
Management Board (CEO) of BRAIN AG.

The Company intends to use the proceeds from the IPO primarily to fund the
research and development of new products, to continuously improve and
upgrade existing products and technologies, and to enhance the marketing of
its own product pipeline. Some portion may also be dedicated to finance
further acquisitions or to increase stakes in certain subsidiary companies,
if this supports the implementation of the Company's industrialisation
strategy. Finally, a small portion of the proceeds shall be used for
working capital requirements and the repayment of shareholder loans granted
for operational purposes.

Increased sustainability through Bioeconomy 

Bioeconomy involves using resources from nature such as microorganisms,
enzymes or individual biomolecules in industrial production processes
amongst others, to achieve significant improvements compared to
conventional processes or products. This results in, for instance, more
resource-friendly, energy-efficient and sustainable processes in the
chemical, mining and consumer goods industries, or more natural products in
the food, animal feed and cosmetics industries. How such a bio-based
economy needs to be built, was recently discussed in Berlin on the "Global
Bioeconomy Summit". This international event, initiated by the bioeconomy
council of the German government, attracted more than 700 participants from
82 states at the end of November 2015. Shortly after, on 30 November 2015,
negotiations started on legally binding universal targets for
sustainability and resource efficiency within the scope of COP21, also
known as the 2015 Paris climate conference.

Industrial biotechnology as harnessed by BRAIN is considered a key
technology in the transition from an economy that is frequently based on
fossil fuels into a sustainable and biology-based economy. In politics and
industry, the term often used for this is "the biologisation of
industries".

Against this backdrop, BRAIN AG perceives the global population growth,
scarcity of resources, climate change as well as consumers' needs for
natural solutions in food and cosmetics products as major growth engines
for products based on biotechnological processes and solutions. Another key
driver identified by the Company is the increasing cost of healthcare,
which can be reduced through the development of healthy foods.

"BRAIN is rethinking biology. The technological use of biological processes
in an industrial environment reflects the Company's core competence and
philosophy. Inspired by the vision of a bio-based economy or so called
Bioeconomy that is geared to natural material cycles, BRAIN is one of the
creative players in this global transformation process", explains Dr Jürgen
Eck when asked about his long-term view of the industry and BRAIN's role in
it.

The Company aims to facilitate and expand the use of biotechnology
solutions and biological products, and intends to service both the
industrial and the end consumer markets. A particular growth potential is
seen in large parts of the chemical industry. Here, BRAIN AG focuses on the
specialty chemicals and the consumer chemicals divisions, with an emphasis
on nutrition, cosmetics and wound care. According to a scientific
publication from the Journal of Commercial Biotechnology (Festel et al.,
2012), experts expect the share of biotechnology products and procedures in
the chemical industry to grow from approximately 12 per cent today to up to
20 per cent by 2020. In this environment, the two aforementioned market
divisions BRAIN focuses on are expected to grow at an annual rate of 15.5
per cent. According to CEFIC, the European Chemical Industry Council, total
sales in the chemical industry in 2013 already amounted to some EUR 3,156
bn worldwide, with a growth forecast of approximately 4 per cent per annum.

+++ENDS+++

About BRAIN 

BRAIN is one of Europe's leading technology companies in the field of
industrial biotechnology, the core discipline of Bioeconomy. As such, BRAIN
identifies previously untapped, efficient enzymes, microbial producer
organisms or natural substances from complex biological systems that can be
put to industrial use. The innovative solutions and products developed by
help of this "Toolbox of Nature" are successfully applied in the chemistry,
the cosmetics and the food industries. Today, BRAIN's business model is
based on two pillars - "BioScience" and "BioIndustrial". The first pillar,
"BioScience", comprises its - frequently exclusive - collaboration business
with industrial partners. The second pillar "BioIndustrial" comprises the
development and commercialisation of BRAIN's own products and active
product components. Further information is available at
www.brain-biotech.de/en


Contact:

B.R.A.I.N. 
Biotechnology Research
And Information Network AG
Dr. Martin Langer
Executive Vice President
Corporate Development
Darmstädter Str. 34-36
64673 Zwingenberg, Germany

Tel.: +49-6251-9331-0
Fax: +49-6251-9331-11
E-Mail: ir@brain-biotech.de
www.brain-biotech.de


Disclaimer

This document and the information contained herein are for information
purposes only and do not constitute a prospectus or an offer to sell
securities in the United States or a solicitation to purchase such
securities in the United States. Any securities referred to herein have not
been, and will not be, registered under the U.S. Securities Act of 1933, as
amended ("U.S. Securities Act"). Such securities may not be offered, sold
or delivered within the United States absent from registration under or an
applicable exemption from the registration requirements of the U.S.
Securities Act. Neither BRAIN AG nor any of its shareholders intends to
register the securities referred to herein in the United States.

This publication constitutes neither an offer to sell nor a solicitation to
purchase any kind of securities. Such an offer is made solely by means of
and on the basis of a published prospectus. The prospectus will be
available free of charge at BRAIN AG, Zwingenberg, Germany, and on the
Internet at www.brain-biotech.de/en.

This document does not constitute an offer document or an offer of
transferable securities to the public in the United Kingdom to which
Section 85 of the U.K. Financial Services and Markets Act 2000 applies and
should not be considered as a recommendation that any person should
subscribe for or purchase any securities as part of the transaction. This
document is only being distributed to and is only directed at (i) persons
who are outside the United Kingdom or (ii) to investment professionals
falling within Section 19 (5) of the Financial Services and Markets Act
2000 (Financial Promotion) Order 2005, as amended (the "Order") or (iii)
high net worth entities, unincorporated associations and other persons or
entities falling within Section 49 (2), (a) to (d) of the Order (all such
persons together being referred to as "relevant persons"). This publication
or its contents must not be acted or relied on by persons who are not
relevant persons. Any investment or investment activity to which this
publication relates is available only to relevant persons and will be
engaged in only with relevant persons. This document (or parts thereof) may
not be published, reproduced, distributed or made available to third
parties in any other way without the prior consent of the company.

Reservations regarding forward-looking statements: This press release
contains forward-looking statements. These statements reflect the current
views, expectations, and assumptions of the management of BRAIN AG and are
based on information currently available to the management. Forward-looking
statements are not guarantees of future performance and involve 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. There are numerous factors which could influence the
future performance by and future developments at BRAIN AG and the BRAIN
group of companies. Such factors include, but are not limited to, changes
in the general economic and competitive environment, risks associated with
capital markets, currency exchange rate fluctuations, changes in
international and national laws and regulations, in particular with respect
to tax laws and regulations, and other factors. The company does not
undertake any obligation to update or revise any forward-looking
statements.


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2016-01-05 Dissemination of a Corporate News, transmitted by DGAP - a
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BRAIN AG announces Intention to Float