candover investments plc chairman's script for the … · distribution test, to return up to...

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CANDOVER INVESTMENTS PLC

CHAIRMAN'S SCRIPT

FOR THE

ANNUAL GENERAL MEETING

INCORPORATING THE CEO AND MANAGER’S PRESENTATIONS

to be held at Ashurst LLP, Broadwalk House, 5 Appold Street, London EC2A 2HA

on Thursday 12 May 2016 at 12.00 noon

SHEET A

CHAIRMAN:

Ladies and Gentlemen, welcome to the Annual General Meeting of Candover Investments plc. The time is now after 12 o-clock so we can start the proceedings. As the requisite quorum of two is present, I declare the meeting open.

Let me start by introducing the Board.

I am Richard Stone and I am Chairman of the Board. To my right is Jan Oosterveld our Senior Independent Director, Chairman of the Nominations Committee and Chairman of the Remuneration Committee. To Jan’s right is Malcolm Fallen, our Chief Executive Officer.

On my left is Amardip Khosa-Stark from Ipes UK who act as our Company Secretary and next to Amardip is Scott Longhurst who chairs the Audit, Risk and Valuation Committee.

The year has been particularly challenging.

The fall in oil prices has continued to impact adversely on shareholders. I noted this time last year that, as the portfolio becomes ever more concentrated, an external systemic shock, like a marked fall in oil prices, would adversely impact on the long-term value of our investments. Unfortunately this has occurred.

After writing down Expro by 141p per share in 2014, as oil prices began to drop, it is extremely disappointing to report that we have had to all but write off this investment following a further 199p per share drop in its value as the oil price continued to decline. The current year’s write-down of Expro’s value accounts for over two-thirds of the reduction in our NAV to 243p per share at the end of 2015.

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At this time last year, the Board noted that it was actively considering alternative sources of funding to mitigate any shortfall in realisation proceeds that would prevent us from repaying the US private placement notes at their maturity date.

Consequently, in July 2015 the Company announced that it had agreed a new term loan facility which, together with cash balances available at the time, allowed the Company to repay the US PP Notes. The terms of the new facility permit the Company, subject to meeting a pre-distribution test, to return up to £21.8 million (equivalent to 100 pence per share) to shareholders, ahead of any repayment of debt, following the realisation of assets.

The Board is not recommending a dividend payment for 2015.

We have always stated that the payment of dividends in the future would be reviewed, in the context of our focus on delivering a progressive return of cash to shareholders, as realisations are achieved by our investment manager. This leads me on to the statements which the Company issued at the end of April.

In those announcements, we set out that both our largest assets, Parques and Technogym, had been partially realised by Arle following IPOs in Spain and Italy respectively. The proceeds from the two IPOs totalling £14 million, together with proceeds from the realisation of Stork BV received in March, will increase our gross cash balances to £ 34 million.

We also continue to hold quoted stakes in both Parques and Technogym which at the IPO prices were worth £32.7 million and £7.6 million respectively. Our remaining interests in Parques and Technogym are subject to a lock up agreement not to sell these shares before the end of October 2016. That said, what we now have is a far more liquid investment with a clear valuation.

Since their respective IPOs, the share price of Parques has declined by 9%, valuing Candover’s remaining investment at £30.4 million, whilst the share price of Technogym has increased by 15%, valuing Candover’s remaining investment at £8.8 million. Both IPOs included greenshoe options.

Turning then to what we will do with our current cash balances following the recent realisation activity. Shareholders will be aware that under the terms of the debt facility a prepayment of €19.4 million is allowed, subject to delivering to the lender a minimum return of 1.15x on the principal repaid. If this payment was delayed until after 12th August 2016, the minimum return rises to 1.4x principal, diluting net assets by £3.85 million.

Following these announcements, the Board has concluded that, given both the length of the lock up period and the structure of Candover’s debt arrangements, the best use of cash balances is to make an initial repayment of debt rather than make a distribution to shareholders as permitted by the debt facility.

Mindful of the general volatility in the markets, as 2016 began, we were hopeful we would see progress on the realisation of our remaining major assets by our investment manager, Arle, enabling us to start returning cash to shareholders. Clearly, the recent news is encouraging.

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I will now ask Malcolm Fallen, our Chief Executive, to provide you with a more detailed review of last year.

Malcolm

MALCOLM FALLEN:

Thank you Richard.

Our strategy remains to achieve a progressive return of cash to shareholders. To support the delivery of this strategy, our focus is twofold. First, we continue to ensure that the Company remains financially stable; and second, we actively review and monitor the performance of Arle, our investment manager, as it seeks to maximise and realise the value of the portfolio.

Our operating model means that there are two clear components to NAV progression. These are: the value of the portfolio assets and any changes which happen to these values; and the costs incurred in running the business, which are principally the fees we pay to Arle, and the interest costs associated with net debt.

So what happened over the course of 2015?

The value of the portfolio decreased by £43.8 million, or 201p per share, over the year, on a constant currency basis. The principal movement within the portfolio was a £45.6 million decrease, before currency movements, in the valuation of Expro. The decline reflects the impact of continued weakness in the energy services market which impacted adversely on Expro’s trading. As a consequence of this weakness, Expro completed a major refinancing during the year to make its capital structure more resilient to a prolonged downturn. This has resulted in further major dilution for Candover because it has not been able to make follow-on investments alongside the Candover 2008 Fund since January 2010. The aggregate value of Parques and Technogym increased by £12.3 million on a constant currency basis, reflecting improved trading, whereas the valuation of Stork BV declined by £7.0 million reflecting the agreed sale value of the investment which occurred in 2016. The adverse impact of foreign currency movements on the portfolio across the year was £3.3 million reflecting the weakness of the Euro relative to Sterling, partially offset by Sterling’s weakness against the US Dollar. However, as announced today, over the course of the first quarter of 2016, the net effect of currency movements on the value of the portfolio has been favourable, with the value increasing by approximately £4.9 million, as a result of the weakness of Sterling relative to the Euro. During 2015, Candover’s recurring administrative expenses reduced by a further 15%, helping to minimise the adverse impact of costs on NAV performance. Finance costs increased following the refinancing of the US PP Notes in August 2015. The rise reflects the higher interest charge associated with the new loan facility.

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The combination of all these movements ultimately led to the Company’s net assets per share decreasing 55%, or 302p per share, over the prior year. Our results have been dominated by the impact of Expro as the oil sector’s turmoil has continued. Our investment has now been written down by over £80 million in the course of the last two years. Let me now turn to our objective of maintaining the financial stability of the Company and the refinancing in 2015. As the Chairman has noted, at last year’s AGM the Board highlighted that it was considering alternative sources of funding ahead of the 31st December 2015 maturity of Candover’s US PP Notes. On 13th July 2015, the Company announced that it had agreed a new term loan facility with 17Capital LLP for up to €52 million (£37.1 million) that, together with available cash balances of £20.8 million, would enable the Company to repay the existing US PP Notes at par and meet future working capital requirements. The US PP Notes were repaid on 13th August 2015. The new debt facility has a five-year maturity which can be further extended at the Company’s option at no cost. The interest charge is payment-in-kind at 13% per annum, which will roll-up and be paid when the loan principal is repaid. The loan is, however, subject to a minimum repayment amount calculated as if the loan had been outstanding for 2.75 years; this is reduced to 1.15 years for any amounts repaid within the first 12 months, up to a maximum of €19.4 million. The terms of the facility allow the Company to return up to £21.8 million (equivalent to 100p per share) to shareholders, ahead of any repayment of debt, following the realisation of assets. This initial return of cash is subject to a pre-distribution test that the portfolio value is at least twice the level of debt. Over the course of last year, net debt increased by £5.9 million to £33.2 million at 31st December 2015. Inflows from realisations of £8.2 million were offset by the follow-on investment in Expro alongside the Candover 2005 Fund, operating costs, financing costs of the US PP Notes and accrued interest on the new debt facility. The adverse impact of foreign currency movements increased net debt by £2.1 million in the second half of the year. Candover’s foreign currency exposure was simplified at the time of its refinancing in August 2015. Following the significant decline in the value of Expro, Candover’s only US Dollar denominated asset, the investment portfolio is now, to a material extent, Euro denominated. The new debt facilities were therefore denominated in Euros to offset, in part, the exposure between the Euro and Sterling. Arle has continued with the disposal of the portfolio during 2015, announcing the full realisation of Stork BV in December 2015. This was achieved through a disposal of the two individual trading entities, Fokker and Stork, with the sale of the first business being completed in July 2015. Candover received proceeds of £5.9 million from the Fokker sale before the year end. Proceeds of £14.1 million are anticipated following completion in 2016 of the Stork

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sale, announced on 7th December 2015. To date £12.8 million has been received with the balance due shortly. The recent announcement referred to by the Chairman relating to the partial realisation of Parques and Technogym, our largest two assets, does mark an important step towards completion of the run off process.

Whilst the two IPOs do provide further liquidity and reduce our pro-forma net debt to just above £11 million, the valuations achieved on IPO by Arle were below the 31 December 2015 valuations. This will result on a pro-forma basis in a reduction of around 60 pence per share.

As we move beyond the IPOs we must hope there is some pick up in value.

Thank you. Let me now hand back to the Chairman.

CHAIRMAN:

Thank you Malcolm. There will be an opportunity to ask Malcolm questions a little later on. I will now ask John Arney, Managing Partner of Arle Capital Partners, our investment manager, to give a review of the portfolio.

JOHN ARNEY: Thank you Richard Since the preliminary results announcement at the end of February this year, we have completed the sale of Stork to Fluor Corporation, that was announced in late 2015. We have also floated two of our biggest portfolio investments, Parques Reunidos and Technogym, through IPOs in Spain and Italy respectively. Despite the prevailing macro uncertainties and the very negative impact of the Telepizza IPO, which traded down 25% in its first two days of trading, both flotations were well received by investors. The IPO of Parques Reunidos, completed on 29th April at a price of €15.50 per share, implying an enterprise value of € 1.85 billion and an initial market capitalisation of €1.3 billion. The IPO raised net proceeds of €34.4 million for the Funds managed by Arle, through a sale of 7.7% of the total investment in Parques. Upon listing, the Arle managed funds retained an interest in Parques of 33.9%, which was valued at approximately €423.9 million and remains subject to a greenshoe option until the end of May 2016. The share price of Parques post IPO has traded down post the IPO price, in part reflecting all fall in the market indices. Key drivers of future valuation will be trading through the important summer season and the progress with the company’s key strategic initiatives. The residual holding is subject to a lock-up period of 180 days from listing. The IPO of Technogym priced at €3.25 per share on 3rd May 2016, implying an enterprise value of €775 million and a market capitalisation of €650m. Demand for the shares exceeded

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the offer by four times, reflecting Technogym's attractive position in the growing health and wellness segment.

On the first day of trading, the share price increased by 11.38% whilst the Italian market as a whole closed down 2.42% down. The share price has gained further ground since that date. Gross proceeds of €162.5 million were raised by Arle for the funds it manages, through the listing of 25% of Technogym’s share capital. A 15% stake has been retained by Arle, reducing to 11.25% if the greenshoe option is fully utilised. As with Parques Reunidos, Arle entered a lock-up period of 180 days from the start date of trading. The valuations of Technogym and Parques Reunidos at the time of listing were lower than the valuations attributed to each business in December 2015. Both Technogym and Parques Reunidos traded strongly in the first quarter of 2016, however, a discount to their listed peers in order to successfully list them amidst very volatile markets. Arle will carefully manage the realisation of the 33.9% stake in Parques Reunidos and the 15% stake in Technogym, post the respective lock-up periods.

The two remaining investments in the portfolio are Hilding Anders and Expro International: Hilding Anders reported a good overall performance in 2015 with sales and EBITDA above prior year, which was mainly driven by a very strong performance in Russia. However, negative FX effects from the drop in value of the Russian Rouble, as well as mixed trading in some parts of Europe, negatively affected the Group’s 2015 results. In 2016, the Group’s performance in Europe is slightly ahead of the same period in 2015, whilst trading in Russia is down versus the exceptional prior year. The trading environment for Expro remains challenging as a consequence of the sustained oil industry downturn. Earlier this year Mike Jardon took on the role of Chief Executive Officer, having previously been the COO of the Group for many years.

Expro is expected to issue full year results for the twelve months ended 31 March 2016 in the coming weeks, which will provide the market with a full update on trading.

In addition to managing the listed investments in Parques Reunidos and Technogym, Arle’s focus for the remainder of this year, will be on driving financial and operational improvements at Hilding Anders and supporting Expro International through the prevailing turbulent market environment; the driving aim being to create platforms for further exits at the appropriate time. With that, I would like to hand you back to the Chairman. Richard.

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CHAIRMAN: Thank you Malcolm and John. Are there any questions for me or my fellow Board members, or for Malcolm and John?

IF THERE ARE ANY QUESTIONS: “Please could you show your shareholder card and state your name before putting your question”. BOARD TO DEAL WITH QUESTIONS

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CHAIRMAN:

I will now turn to the formal business of the meeting, being the Resolutions set out in the Notice of Meeting.

The Notice convening this meeting was sent to shareholders and placed on our website on 6 April 2016, together with the Company's Annual Report and Accounts for the year ended 31 December 2015. I should like, with your permission, to take the Notice as read.

If no objection

THE NOTICE IS TAKEN AS READ.

If not unanimously agreed

I call upon the secretary to read the Notice of Meeting.

THE SECRETARY TO READ THE NOTICE OF MEETING.

CHAIRMAN:

Resolutions 1 to 7 are proposed as Ordinary Resolutions, which require a simple majority to be passed. Resolutions 8 to 10 are proposed as Special Resolutions which require at least a 75 per cent majority of the vote. Voting must be carried out by those shareholders voting here in person, by duly appointed proxies or, in the case of corporation members, by duly authorised corporate representatives.

There will be opportunities to ask questions on each Resolution as it is proposed. May I ask that, if a shareholder or proxy would like to raise a question, you raise your hand. On being invited to put your question, please first state your name and show your shareholder card.

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RESOLUTION NO. 1 - LAYING OF ANNUAL ACCOUNTS, DIRECTORS' REPORT AND AUDITORS' REPORT CHAIRMAN: We now come to the first item on the agenda, concerning the 2015 Report and Accounts, which have been made available to shareholders. I do not propose to read these out.

IF ANY OBJECTION, AUDITORS' REPORT TO BE READ BY THE AUDITORS

CHAIRMAN: In a moment I will ask if any shareholders or proxies have questions but, before doing so, I would like to propose Resolution 1, as set out in the Notice of Meeting, as an Ordinary Resolution. Are there any questions on this resolution or on the reports and accounts generally?

IF THERE ARE ANY QUESTIONS: “Please show your shareholder card and state your name before putting your question”.

CHAIRMAN TO DEAL WITH QUESTIONS

There being no [further] questions, I now put Resolution 1 to the vote of the meeting on a show of hands. Those in favour of Resolution 1, please raise your hands [VOTES ARE COUNTED]. Those not in favour, please raise your hands [VOTES ARE COUNTED]. Thank you.

COUNT HANDS FOR AND AGAINST THE RESOLUTION. IF THE RESULT IS NOT IMMEDIATELY OBVIOUS, THE SECRETARY WILL REPORT RESULT TO THE CHAIRMAN.

I declare Resolution 1 [duly passed as an Ordinary Resolution] [lost] on a show of hands. For the record, and in accordance with the UK Corporate Governance Code, I should mention that for this resolution, the Company has received valid proxies representing 6,150,321 votes in favour of the resolution and 350 votes against the resolution, with 1,825,387 votes withheld and 1,819 votes to be cast at the proxy’s discretion. A summary of the proxy votes for all the resolutions to be proposed today will be available on our website and for collection from the Company Secretary at the end of the meeting if anyone so wishes.

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Option A – If the resolution is passed, continue to Resolution 2 Option B – If the resolution is passed, but a poll is demanded by the floor, continue with SHEET C now Option C – If the resolution is not passed, the Chairman should demand a poll to be taken at the end of the meeting In accordance with the Company's Articles of Association, I demand that a poll be taken on the resolution which has just been put to the meeting. In order that we may continue with the business of the meeting, I propose that this poll be carried out at the end of the meeting. CONTINUE TO RESOLUTION 2

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RESOLUTION NO. 2 - APPROVAL OF DIRECTORS' REMUNERATION REPORT CHAIRMAN: The next item on the agenda is Resolution 2, the approval of the Directors’ Remuneration Report. This is a resolution which is required to be put to shareholders under the Companies Act 2006. The Board has approved the Directors’ Remuneration Report for the financial period ended 31 December 2015 which is now laid before this meeting. I would like to propose Resolution 2, as set out in the Notice of Meeting, as an Ordinary Resolution. Jan Oosterveld - Chairman of the Remuneration Committee - and I would now be pleased to deal with any questions on the Directors’ Remuneration Report.

IF THERE ARE ANY QUESTIONS: “Please show your shareholder card and state your name before putting your question”. CHAIRMAN and/or JAN TO DEAL WITH QUESTIONS

There being no [further] questions, I now put Resolution 2 to the vote of the meeting on a show of hands. Those in favour of Resolution 2, please raise your hands? [VOTES ARE COUNTED]. Those not in favour, please raise your hands [VOTES ARE COUNTED]. Thank you.


I declare Resolution 2 [duly passed as an Ordinary Resolution] [lost] on a show of hands. For your information, 6,109,926 proxy votes were received in favour of the resolution and 1,863,237 votes against the resolution, with 3,545 votes withheld and 1,169 votes to be cast at the proxy’s discretion.

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Option A – If the resolution is passed, continue to resolution 3 Option B – If the resolution is passed, but a poll is demanded by the floor, continue with SHEET C now Option C – If the resolution is not passed, the Chairman should demand a poll to be taken at the end of the meeting In accordance with the Company's Articles of Association, I demand that a poll be taken on the resolution which has just been put to the meeting. [As I have indicated with regard to the previous resolution,] in order that we may continue with the business of the meeting, I propose that this poll be carried out at the end of the meeting. CONTINUE TO RESOLUTION 3

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RESOLUTION NO. 3 – RE-ELECTION OF RICHARD STONE AS A DIRECTOR Resolution to be proposed by Jan Oosterveld CHAIRMAN: As Resolution 3 concerns my re-election, I will momentarily pass the chairmanship of this meeting to Jan Oosterveld. JAN OOSTERVELD: The next resolution, Resolution 3, concerns the re-election of a director. In accordance with the Company's Articles of Association and the UK Corporate Governance Code, Richard Stone is retiring from office as a Director at this meeting and, being eligible, is standing for re-election. Richard’s biography appears on page 19 of the annual report. I would like to propose Resolution 3, as set out in the Notice of Meeting, as an Ordinary Resolution. Before I put Resolution 3 to the vote, are there any questions?


JAN TO DEAL WITH QUESTIONS

There being no [further] questions, I now put Resolution 3 to the vote of the meeting on a show of hands. Those in favour of Resolution 3, please raise your hands. [VOTES ARE COUNTED] Those not in favour, please raise your hands. [VOTES ARE COUNTED] Thank you.


I declare Resolution 3 [duly passed as an Ordinary Resolution] [lost] on a show of hands For your information, 6,024,875 proxy votes were received in favour of the resolution and 1,948,740 votes against the resolution, with 2,443 votes withheld and 1,819 votes to be cast at the proxy’s discretion. I will now pass the chair back to Richard Stone. CHAIRMAN: Thank you Jan.

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Option A – If the resolution is passed, continue to Resolution 4 Option B – If the resolution is passed, but a poll is demanded by the floor, continue with SHEET C now Option C – If the resolution is not passed, the Chairman should demand a poll to be taken at the end of the meeting In accordance with the Company's Articles of Association, I demand that a poll be taken on the resolution which has just been put to the meeting. [As I have indicated with regard to the previous resolution,] in order that we may continue with the business of the meeting, I propose that this poll be carried out at the end of the meeting. CONTINUE TO RESOLUTION 4

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RESOLUTION NO. 4 – RE-ELECTION OF MALCOLM FALLEN AS A DIRECTOR CHAIRMAN: The next resolution, Resolution 4, concerns the re-election of a director. In accordance with the Company's Articles of Association and the UK Corporate Governance Code, Malcolm Fallen is retiring from office as a Director at this meeting and, being eligible, is standing for re-election. Malcolm’s biography appears on page 19 of the annual report. I would like to propose Resolution 4, as set out in the Notice of Meeting, as an Ordinary Resolution. Before I put Resolution 4 to the vote, are there any questions?





I declare Resolution 4 [duly passed as an Ordinary Resolution] [lost] on a show of hands For your information, 5,995,475 proxy votes were received in favour of the resolution and 1,977,880 votes against the resolution, with 2,703 votes withheld and 1,819 votes to be cast at the proxy’s discretion.

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RESOLUTION NO. 5 - REAPPOINTMENT OF AUDITOR CHAIRMAN: Resolution 5 is to reappoint Grant Thornton UK LLP as auditors of the Company. I would like to propose Resolution 5, as set out in the Notice of Meeting, as an Ordinary Resolution. Before I put Resolution 5 to the vote, are there any questions?





I declare Resolution 5 [duly passed as an Ordinary Resolution] [lost] on a show of hands For your information, 7,823,928 proxy votes were received in favour of the resolution and 1,000 votes against the resolution, with 151,754 votes withheld and 1,195 votes to be cast at the proxy’s discretion.

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RESOLUTION NO. 6 - FIXING OF AUDITOR’S REMUNERATION CHAIRMAN: Resolution 6 is to authorise the directors to set Grant Thornton’s remuneration. I would like to propose Resolution 6, as set out in the Notice of Meeting, as an Ordinary Resolution. Before I put Resolution 6 to the vote, are there any questions?



There being no [further] questions, I now put Resolution6 to the vote of the meeting on a show of hands. Those in favour of Resolution 6, please raise your hands. [VOTES ARE COUNTED] Those not in favour, please raise your hands. [VOTES ARE COUNTED] Thank you.


I declare Resolution 6 [duly passed as an Ordinary Resolution] [lost] on a show of hands For your information 7,824,739 proxy votes were received in favour of the resolution and 650 votes against the resolution, with 151,319 votes withheld and 1,169 votes to be cast at the proxy’s discretion.

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CHAIRMAN: Resolutions 7 and 8 concern the allotment of shares of the Company. Similar resolutions were passed at last year’s Annual General Meeting, but those authorities expire at this year’s meeting. If passed again, these authorities will expire on 30 June 2017, or at the conclusion of the next Annual General Meeting, whichever is earlier. These resolutions have been proposed in order to provide the Board with the flexibility to take decisive action, if required. RESOLUTION NO. 7 – AUTHORITY TO ALLOT CHAIRMAN: Resolution 7, as detailed in the Notice of Meeting explanatory notes, seeks shareholder approval to grant new authority to allot shares. The resolution will grant new authorities to allot shares up to an aggregate nominal value of £1,814,881 and, in connection with a rights issue, equity securities up to an aggregate nominal value of £3,629,763 (which shall be reduced by any allotments under part (a) of the resolution).

The thresholds specified are in line with those suggested by the Investment Association. However, the Directors have no present intention of issuing shares pursuant to this authority. I would like to propose Resolution 7, as set out in the Notice of Meeting, as an Ordinary Resolution. Before I put Resolution 7 to the vote, are there any questions?





I declare Resolution 7 [duly passed as an Ordinary Resolution] [lost] on a show of hands For your information, 6,149,086 proxy votes were received in favour of the resolution and

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1,676,703 votes against the resolution, with 150,919 votes withheld and 1,169 votes to be cast at the proxy’s discretion. Option A – If the resolution is passed, continue to Resolution 8 Option B – If the resolution is passed, but a poll is demanded by the floor, continue with SHEET C now Option C – If the resolution is not passed, the Chairman should demand a poll to be taken immediately In accordance with the Company's Articles of Association, I demand that a poll be taken on the resolution which has just been put to the meeting. This poll must be taken straight away as the next resolution cannot be voted on unless this resolution is passed. CONTINUE TO SHEET B NOW.

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RESOLUTION NO. 8 – DISAPPLICATION OF PRE-EMPTION RIGHTS CHAIRMAN: Resolution 8, as detailed in the Notice of Meeting explanatory notes, seeks shareholder approval to allot shares on a non pre-emptive basis. The power will be limited to the allotment of equity securities and sales of treasury shares for cash up to an aggregate nominal value of £273,207 - 5% of the Company’s share capital. The threshold specified is in line with that suggested by the Investment Association. I would like to propose Resolution 8, as set out in the Notice of Meeting, as a Special Resolution. Before I put Resolution 8 to the vote, are there any questions?





I declare Resolution 8 [duly passed as a Special Resolution] [lost] on a show of hands For your information, 6,136,043 proxy votes were received in favour of the resolution and 15,203 votes against the resolution, with 1,825,387 votes withheld and 1,244 votes to be cast at the proxy’s discretion.

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RESOLUTION NO. 9 – PURCHASE OF OWN SHARES BY THE COMPANY CHAIRMAN: Resolution 9 concerns authority for the Company to purchase its own shares in the market. The authority will be limited to the purchase of up to 3,264,609 of the Company’s ordinary shares, 14.99% of its share capital. This authority will expire at the next Annual General Meeting or on 30 June 2017, whichever is the earliest. A similar resolution was passed at last year’s Annual General Meeting, but that authority expires at this year’s meeting. The resolution also sets out the highest and lowest price at which the shares can be bought. If the Company buys any shares under this authority, they may either be cancelled or held in treasury. The resolution follows the rules set down by the Companies Act 2006 and the UK Listing Authority. I would like to propose Resolution 9, as set out in the Notice of Meeting, as a Special Resolution. Before I put Resolution 9 to the vote, are there any questions?





I declare Resolution 9 [duly passed as a Special Resolution] [lost] on a show of hands For your information, 7,820,183 proxy votes were received in favour of the resolution and 5,606 votes against the resolution, with 150,919 votes withheld and 1,169 votes to be cast at the proxy’s discretion.

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RESOLUTION NO. 10 - NOTICE PERIOD FOR GENERAL MEETINGS CHAIRMAN: The purpose of Resolution 10 is to permit general meetings of the Company to be called on a minimum of 14 clear days’ notice. This provision will not apply to Annual General Meetings, which will continue to be held on at least 21 clear days’ notice. The flexibility offered by this resolution will be used where, taking into account the circumstances, the Board considers it appropriate in relation to the business to be considered at the meeting. If this resolution is passed, the approval will be effective until the Company’s next Annual General Meeting, when it is intended that a similar resolution will be proposed. I would like to propose Resolution 10, as set out in the Notice of Meeting, as a Special Resolution. Before I put Resolution 10 to the vote, are there any questions?





I declare Resolution 10 [duly passed as a Special Resolution] [lost] on a show of hands For your information, 6,149,355 proxy votes were received in favour of the resolution and 1,675,434 votes against the resolution, with 151,269 votes withheld and 1,819 votes to be cast at the proxy’s discretion.

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Option A – If the resolution is passed, continue to next page Option B – If the resolution is passed, but a poll is demanded by the floor, continue with SHEET C now Option C – If the resolution is not passed, the Chairman should demand a poll to be taken now In accordance with the Company's Articles of Association, I demand that a poll be taken on the resolution which has just been put to the meeting. There are no more resolutions to put to the meeting and therefore this poll [together with the polls in relation to resolution number(s)] will be conducted now. CONTINUE TO NEXT PAGE

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IF A POLL HAS BEEN CALLED BY CHAIRMAN AND IS TO BE CONDUCTED AT THE END OF THE MEETING, PROCEED TO SHEET B. IF A POLL HAS BEEN CALLED BY FLOOR AND IS TO BE CONDUCTED AT THE END OF THE MEETING, PROCEED TO SHEET C. CLOSE OF MEETING CHAIRMAN: Ladies and gentlemen, that concludes the formal business of today’s meeting. On behalf of the Board, I would like to thank you all for attending Candover’s 2016 Annual General Meeting. I declare the meeting closed. Light refreshments are available behind you and your Board would be pleased if you were able to join us.

END OF MEETING

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