mergers & acquisitions quarterly switzerland - second quarter 2015

Second quarter 2015

July 2015 edition

Mergers & Acquisitions Quarterly Switzerland

All rights reserved — EY 2015

DRAFT Contents

1

1. Introduction 2

2. Swiss M&A market Q2 2015 and outlook 2015 3

3. Private equity statistics: Germany, Switzerland and Austria 6

4. Industry overview

► Chemicals, Construction and Materials 7

► Energy and Utilities 9

► Financial Services 11

► Healthcare 13

► Industrial Goods and Services 15

► Media, Technology and Telecommunications 17

► Retail and Consumer Products 19

5. Deal of the quarter 21

6. Event calender 22

7. EY selection of M&A opportunities 23

8. Contacts 24

9. Subscription/Registration form 25

Mergers & Acquisitions Quarterly Switzerland – Q2 2015


DRAFT Introduction

2

Dear Reader

In the second quarter of 2015, Swiss M&A activity continued to decline. As the wave of mega deals grinded to a halt and economic indicators worsened, as the Swiss Franc gained strength, both the number and volume of transactions suffered, dipping well below its long-term historic average.

Looking ahead and given the significant decline in M&A activity in recent quarters, the Swiss M&A market is expected to stabilize at Q2 levels.

We hope you enjoy reading our publication with more information on these interesting developments on the following pages of this publication.

For more information or to download this publication, visit us online at:

www.ey.com/CH/de/Services/Transactions/Lead-Advisory

Sincerely,

Your Swiss EY M&A Advisory Team



DRAFT Swiss M&A market Q2 2015 and outlook 2015

3

Number of announced deals and transaction volumes with target, buyer or seller in Switzerland

Relative stock performance of selected industries over the past 12 months

M&A market Q2 2015

► In the second quarter of 2015, the performance of the Swiss M&A market continued to decline, as evidenced by a decrease in both number and volume of transactions. Compared to the previous quarter, the number of transactions decreased by 6% while deal volume saw a 41% decline.

► The 128 transactions announced in Q2 reached a volume of only CHF 9.5b, the lowest value recorded since Q4 2013 and significantly below average volume per quarter of CHF 21.0b.

► The sharp decline is a result of the wave of mega deals grinding to a halt. While previous quarters recorded several mega deals, such as the Lafarge and Holcim merger (CHF 41b), the Alliance Boots and Walgreen deal (CHF 23b) and the GlaxoSmithKline and Novartis transformational transaction (CHF 14b), no transaction valued above CHF 5b was announced in Q2 2015.

► With a weak performance over the last three months, the SMI’s cumulative 12-month performance totaled 4.7% at the end of June.

► Valuations of export-oriented companies and sectors, e.g. Chemicals, Construction and Materials, Industrial Goods and Services and Retail and Consumer Products, were negatively impacted by the strong Swiss Franc.

Rank Announcement date Target Acquirer Seller Deal volume (in CHF m)

1 02-Feb-15 Holcim AG and Lafarge S.A., cement assets

CRH plc Holcim AG; Lafarge S.A. 6,825

2 28-Jan-15 TE Connectivity, telecom, enterprise and wireless business

CommScope Holding Company, Inc.

TE Connectivity Ltd. 2,765

3 28-Mar-15 World Duty Free S.p.A. Dufry AG Schematrentaquattro S.p.A. 2,460

4 21-Apr-15 Madrileña Red de Gas S.A.U. PGGM; Gingko Tree Investments; EDF Invest

Partners Group; Morgan Stanley Infrastructure

2,152

5 30-Apr-15 Dorma Holding GmbH + Co. KGaA

Kaba Holding AG N/A 1,214

The five largest transactions in 2015


(30%)

(20%)

(10%)

0%

10%

20%

30%

40%

Healthcare Media,Technology &

Telecom

FinancialServices

IndustrialGoods &Services

Chemicals,Construction& Materials

Retail & ConsumerProducts

Energy & Utilities

SMI

0

30

60

90

120

150

180

0

15

30

45

60

75

90

Q2 14 Q3 14 Q4 14 Q1 15 Q2 15

No.

of d

eals

Dea

l vol

ume

in C

HF

b

Volume No. of deals


DRAFT

21%

20%

14%10%

8%

6%

4%

17%

Media, Technology and Telecommunications Industrial Goods and Services

Retail and Consumer Products Financial Services

Healthcare Chemicals, Construction and Materials

Energy and Utilities Other Industries

Transactions by industry

► In the second quarter of 2015, Media, Technology and Telecommunications was the most active sector in Switzerland, contributing 27 transactions or 21% of the total 128 deals announced. The largest transaction in this sector was the acquisition of einsAmobile by mobilezone valued at CHF 70m.

► Despite the turbulent times since the SNB’s announcement to abandon the CHF/EUR floor, Industrial Goods and Services continued to have robust M&A activity in the second quarter of 2015, contributing 26 deals or 20% of all deals announced. The largest transaction was the merger of KABA and Dorma, valued at CHF 1,214m.

► Retail and Consumer Products registered a moderate decline of one percentage point, remaining the third most active sector in terms of M&A. Although the transaction value was not disclosed, Kuoni’s sale of its European outbound travel business to Rewe was a landmark transaction for the Swiss RCP sector. Kuoni is considered one of the top tier travel service providers in Switzerland and has over 100 years of tradition in serving Swiss and international travelers around the globe.

4

Number of Swiss M&A transactions by industry in Q2 2015 (in %)

Number of Swiss M&A transactions by deal size (in %)

Swiss M&A market Q2 2015 and outlook 2015

Transactions by size

► In Q2, the share of large transactions reached the highest value ever recorded, as 46% of all deals were valued above CHF 250m.

► This is to be viewed with caution, however, as deal values were only disclosed in 17% of all announced transactions.

► Furthermore, although several deals were large, the wave of mega deals valued above CHF 5b as witnessed in previous quarters, has come to a grinding halt. While six mega deals were announced in 2014, only one has been recorded in the first half of 2015.

*Arrows indicate change from previous quarter

▼

▼ ▲

-

▲


21%

19%

14%9%

7%

7%

5%

18%





21%

19%

14%9%

7%

7%

5%

18%





- ▲

-

49%

18%

32%

36%

19%

46%

0%

20%

40%

60%

80%

100%

Q1 15 Q2 15

< CHF 50m CHF 50-250m > CHF 250m


DRAFT

5

Outlook 2015

► As predicted by several economic forecasts, the Swiss economy declined as the Swiss Franc strengthened materially following the removal of the CHF/EUR exchange rate floor in January. In its most recent report of May 2015, the Swiss State Secretary for Economic Affairs (SECO) reported a real GDP decline of -0.2% for the first quarter 2015. This is the first time since Q3 2011 that the Swiss economy has contracted.

► In detail, exports of goods (excluding non-monetary gold, valuables and merchanting) declined in virtually all sectors resulting in a total reduction of -2.3%, with a significant reduction coming from the chemicals and pharmaceutical industry. In particular the trading sector (-1.9%) and the accommodation sector (-3.8%) reported sizable slowdowns.

► If the decline in economic activity continues and, as some experts forecast, GDP growth in Q2 will be negative as in Q1, the Swiss economy will technically be in recession. However, experts agree that the economic performance outlook for the year as a whole is still positive, with SECO predicting 0.8% GDP growth and KOF estimating 0.4%.

► On a positive note and for the first time since 2010, more than half of all respondents to EY’s Global Capital Confidence Barometer study intend to make an acquisition and almost half expect to close an acquisition in the next 12 months. Combined with a 19% reported increase in deal pipelines, this brightens the outlook for the global M&A market’s development.

► In summary, the strong Swiss Franc proved to have a negative effect on Swiss M&A activity and, coupled with worsening economic forecasts, is expected to continue having a dampening effect going forward. With the M&A market performing around historic lows at the moment and given the steep decline in recent quarters, additional negative developments are not expected. Against this background and in view of select positive impulses from EY’s CCB study as well as transaction pipeline, the overall outlook on Swiss M&A activity is stable performance around Q2 levels with upside potential.

Swiss M&A market Q3 2015 and outlook 2015

Change in industry multiples from Q1 2015 to Q2 2015

Industry TEV/EBITDA (LTM)

Chemicals, Construction & Materials ▼

Energy & Utilities -

Healthcare ▲

Industrial Goods & Services ▲

Media, Technology & Telecomm. ▼

Retail and Consumer Products ▼

P/E (LTM)

Financial Services ▼

EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization TEV = Total Enterprise Value LTM = Last Twelve Months P/E = Price-to-Earnings Ratio



DRAFT

0

5

10

15

20

25

30

35

40

0

2

4

6

8

10

12

Q2 14 Q3 14 Q4 14 Q1 15 Q2 15

No.

of b

uy-o

uts

and

buy-

ins

Dea

l vol

ume

in E

UR

b

Deal volume No. of deals

Private equity statistics: Germany, Switzerland and Austria

6

Private equity Q2 2015

► The second quarter of 2015 showed an increase of 11 closed private equity (PE) deals, compared with the first quarter of 2015, resulting in a total of 36 transactions. At the same time, deal volume dropped by 69%, from EUR 10.9b in Q1 to EUR 3.4b in Q2 2015.

► Deal volume in Q1 2015 was mainly driven by three mega deals valued above EUR 2b. Q2 2015, on the other hand, was characterized by an exceptionally large number of transactions, outperforming the quarterly average of 19 transactions in 2014 by 89%. This performance was mainly attributable to PE deals with German targets, which increased by 72% from Q1 2015 to Q2 2015 .

► The largest transaction in Q2 2015 was the sale of Constantia Flexibles Group GmbH by One Equity Partners LLC (75%) and H. Turnauer Foundation (25%) to the Wendel Group for a consideration of EUR 2.3b.

► One Equity Partners LLC acquired Constantia in 2009. Since then, Constantia has developed from a regionally focused flexible packaging provider, to a globally operating corporate group, with sales increasing 73% and earnings (EBITDA) 76%.

Number and volume of buy-outs and buy-ins completed with targets based in GSA

Number of buy-outs and buy-ins by deal size within GSA (in %)

*2015 figures are for the first six months only


67%78% 77% 72%

83%

25%10% 9%

12%5%

8% 12% 14% 16% 12%

0%

20%

40%

60%

80%

100%

2011 2012 2013 2014 2015

< EUR 50m EUR 50-250m > EUR 250m


DRAFT Chemicals, Construction and Materials

7

Relative performance charts

Margins (LTM) * Companies included in the Chemicals, Construction and Materials Index

Legend

EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortization EBIT = Earnings Before Interest and Taxes P/E = Price-to-Earnings Ratio LTM = Last Twelve Months TEV = Total Enterprise Value Rev. = Revenue * = Equally weighted

Chemicals, Construction and Materials Index Swiss SMI Index (value weighted)

AFG Arbonia-Forster-Holding AG Belimo Holding AG Bossard Holding AG Clariant AG Dottikon Es Holding AG EMS-Chemie Holding AG Forbo Holding AG Geberit AG Givaudan AG

Glencore Xstrata Plc Gurit Holding AG Holcim (Schweiz) AG Implenia AG Schmolz + Bickenbach AG Sika AG Syngenta AG

12-month relative performance (in %) * Multiples (LTM) *


1.7x

11.2x

15.5x

21.3x

3.0x

10.3x

12.7x

20.5x

0x

5x

10x

15x

20x

25x

30x

TEV/Rev. TEV/EBITDA TEV/EBIT P/E

40.3%

14.8%

8.1% 7.7%

33.8%

23.6%

15.3%11.1%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Gross margin EBITDA margin Earnings from continuedoperations margin

Net income margin

65%

80%

95%

110%

125%

140%

155%

Jun 14 Jul 14 Aug 14 Sep 14 Oct 14 Nov 14 Dec 14 Jan 15 Feb 15 Mar 15 Apr 15 May 15 Jun 15


DRAFT Chemicals, Construction and Materials

8

Selected mergers & acquisitions transactions/private placements

Date Company Event type Headline

25-Jun-15 Sika AG Strategic alliance The takeover battle for Sika continues; recent developments include FINMA’s appeal rejection in favor of the owners and an US asset manager acquiring a 3% stake in the company while announcing to support SIKA management

09-Jun-15 Implenia AG Client announcement Implenia, acting as part of a consortium, has won a contract worth CHF 480m, for the construction of section SBT1.1 of the Semmering Base Railway Tunnel in Austria

19-May-15 Holcim (Schweiz) AG Executive/ Board change

Holcim announced Kaspar Wenger as designated Chairman of the Board of Holcim, effective 30 June 2015; his previous position as the Area Manager Central Europe will be succeeded by Gerd Aufdenblatten

12-May-15 Belimo Holding AG Business reorganization Belimo plans to decentralize the group's Global Product Management division, at the end of June 2015, in order to be closer to its clients and markets

28-Apr-15 Syngenta AG Product-related announcement

Syngenta received US EPA approval for its corn herbicide, ACURON, with sales potential of over CHF 240m (USD 250m); ACURON has been shown to improve control over more than 70 weeds

23-Apr-15 Forbo Holding AG Buyback Forbo completed a share buyback of 160,000 shares between 29 April 2014 and 23 April 2015; the buyback represents 7.44% of the share capital of Forbo

09-Apr-15 Holcim (Schweiz) AG Executive/ Board change

The Boards of Directors of Holcim and Lafarge appointed Eric Olsen as the future CEO of LafargeHolcim, effective post closing of the ongoing merger; Eric Olsen currently serves as the Executive Vice-President of Operations for Lafarge

07-Apr-15 Clariant AG Business expansion Clariant opened a new desiccant manufacturing plant at its site in Zhengjiang, China, to supply the growing desiccant demand in China; the new facility will produce cargo desiccants, that help protect goods from moisture and water damage during transportation

02-Apr-15 Sika AG Business expansion Sika expanded its presence in Asia Pacific by founding a subsidiary company in Myanmar, and opening a new concrete admixture plant in Ekala, Sri Lanka; the expansion enables the company to further utilize the market potential of this region

Announcement date Size (CHF m) Percent sought Target Seller Buyer/Investor

01-May-15 N/A 100% Charpentes Françaises SAS Wolseley plc Endless LLP

11-May-15 N/A 100% CU Chemie Uetikon GmbH Equistone Partners Europe (Schweiz) AG NOVACAP SAS

22-Apr-15 N/A 100% Holcim (Schweiz) AG, cement facilities in USA Holcim (Schweiz) AG Essroc Cement Corp.

07-Apr-15 N/A 100% Importation et Solutions Bois Wolseley plc N/A

Selected key developments



DRAFT Energy and Utilities

9



Margins (LTM) * Companies included in the Energy and Utilities Index


Energy and Utilities Swiss SMI Index (value weighted)

Alpiq Holding AG BKW AG Repower AG

Romande Energie Holding SA Transocean Ltd.

Legend


0.9x

6.1x

14.1x

6.0x

3.0x

10.3x

12.7x

20.5x

0x

5x

10x

15x

20x

25x

30x


32.1%

19.7%

-6.8% -7.0%

33.8%

23.6%15.3%

11.1%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Gross margin EBITDA margin Earnings fromcontinued operations

margin

Net income margin

65%

80%

95%

110%

125%

140%

155%



DRAFT Energy and Utilities

10




08-Jun-15 Alpiq Holding AG Buyback Alpiq announced a cash tender offer to buy back up to CHF 450m of its outstanding senior CHF bonds due 2016-2019; the buyback aims to reduce debt, lower future funding costs and optimize the company’s debt maturity profile

13-May-15 Alpiq Holding AG Product-related announcement

Alpiq received the ISO 55'001 certification for its hydroelectric power plant management; Alpiq is the first electricity company in Switzerland as well as in Europe to obtain the certification

30-Apr-15 Alpiq Holding AG Executive/ Board change

Alpiq appointed Jens Alder as the new Chairman of the Board, replacing Hans E. Schweickardt; also three new members were elected to the Board of Directors including Heiko Berg, Philipp Büssenschütt and Tilmann Steinhagen

21-Apr-15 Transocean Ltd. Executive/ Board change

Transocean appointed Jeremy Thigpen as the President & CEO, replacing the Interim CEO, Ian Strachan, effective 22 April 2015; Ian Strachan will additionally retire as the Chairman at the 2015 Annual General Meeting following 16 years of service


22-Jun-15 272 100% Gecal Renovables, S.A. Springwater Capital, LLC Gas Natural SDG SA

28-May-15 N/A 100% 1,755 MW photovoltaic plant in Mallorca, Spain

N/A Edisun Power Europe AG

21-Apr-15 2,152 100% Madrileña Red de Gas S.A.U. Partners Group; Morgan Stanley Infrastructure

PGGM; Gingko Tree Investments Ltd.; EDF Invest

20-Apr-15 N/A 100% Morewind Holding; Strongwind Holding Aravis SA N/A



DRAFT Financial Services

11



Margins (LTM) *+ Companies included in the Financial Services Index

Legend

P/BV = Price-to-Book-Value Ratio P/Tang BV = Price-to-Tangible-Book-Value Ratio P/E = Price-to-Earnings Ratio LTM = Last Twelve Months TEV = Total Enterprise Value Rev. = Revenue * = Equally weighted + = Banks only (insurance companies excluded)

Financial Services Index Financial Services Index (previous quarter)

Bâloise Holding AG Bank Coop AG Banque Cantonale Vaudoise SA Cembra Money Bank AG Credit Suisse Group AG EFG International AG GAM Holding AG Glarner Kantonalbank Helvetia Schweizerische Versicherungsgesellschaft AG

Julius Bär Gruppe AG Leonteq AG Liechtensteinische Landesbank AG Partners Group Holding AG St. Galler Kantonalbank AG Swiss Life Holding AG Swiss Reinsurance AG Swissquote Group Holding SA Thurgauer Kantonalbank UBS AG

Valiant Holding AG Vontobel Holding AG VZ Holding AG Zurich Insurance Group AG


2.1x 2.5x

18.2x

2.1x 2.7x

19.0x

0x

5x

10x

15x

20x

25x

30x

P/BV P/Tang BV P/E

15.8% 15.7%

6.9%

14.9% 14.5%

6.7%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

Earnings from continuedoperations margin

Net income margin Return on equity

65%

80%

95%

110%

125%

140%

155%



DRAFT Financial Services

12


22-Jun-15 146 100% Seven Investment Management LLP Zurich Insurance Group; Aegon N.V. Caledonia Investments Plc

18-Jun-15 225 100% UBS AG, alternative fund services business UBS AG Mitsubishi UFJ Financial Group, Inc.

29-May-15 N/A 100% Skandia Leben AG Old Mutual plc Life Invest Holding AG

26-May-15 N/A 100% Dimension SA N/A Banque Cantonale de Genève SA

25-May-15 N/A 100% UBS AG, wealth management unit in Australia UBS AG N/A

06-May-15 N/A 100% Diners Club Italia S.r.l.; Dinit d.o.o. Diners Club International Ltd. Corner Banca SA

29-Apr-15 N/A 84% Hesse Newman Capital AG SBW Schweizer Beteiligungs-Werte AG HSL Vermögensverwaltung GmbH




10-Jun-15 Partners Group Holding AG Product-related announcement

Partners Group raised USD 700m for an multi-asset credit strategy program; it is the first comingled investment program to offer exposure to private market debt, incorporating real estate and infrastructure debt as well as corporate debt

27-May-15 Bâloise Holding AG Executive/ Board change

Bâloise’s CEO Martin Strobel will be standing down from his position, effective 30 April 2016; the company will start a selection process of a new CEO in due time to allow for a smooth transition process

07-May-15 Cembra Money Bank AG Buyback Cembra bought back 1.8m shares (or 6.0% of the outstanding shares) at a price of CHF 55.50 each; the shares were acquired from General Electric, the former majority shareholder

29-Apr-15 Bank Coop AG Business reorganization Bank Coop announced a strategic restructuring plan, that entail’s a merger and rationalization of the marketing and legal departments of Bank Coop and its subsidiary BKB; the proposed restructuring will not include personnel layoffs in 2015

24-Apr-15 Helvetia Schweizerische Versicherungsgesell. AG

Executive/ Board change

Helvetia elected Pierin Vincenz as its new President effective 1 October 2015

23-Apr-15 EFG International AG Executive/ Board change

EFG International appointed Joachim Strähle as its new CEO effective 24 April 2015 and replacing John Williamson, who will become Vice Chairman and is expected to be proposed as Chairman in 2016

30-Mar-15 BSI SA DoJ program BSI is the first category 2 bank which reached a non-prosecution agreement with the DoJ resulting in a payment of USD 211m. During Q2 2015, a further dozen other banks have subsequently announced settlements under the US program



DRAFT Healthcare

13



Margins (LTM) * Companies included in the Healthcare Index

Legend


Healthcare Index Swiss SMI Index (value weighted)

Actelion Ltd. Bachem Holding AG Basilea Pharmaceutica AG COLTENE Holding AG Cytos Biotechnology AG Galenica AG LifeWatch AG Lonza Group AG Molecular Partners AG

Nobel Biocare Holding AG Novartis AG Roche Holding AG Siegfried Holding AG Sonova Holding AG Straumann Holding AG Tecan Group AG Ypsomed Holding AG


3.2x

15.3x

20.2x

24.3x

3.0x

10.3x

12.7x

20.5x

0x

5x

10x

15x

20x

25x

30x


46.1%

21.0%

10.6% 9.6%

33.8%

23.6%

15.3%11.1%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Net income margin

65%

80%

95%

110%

125%

140%

155%



DRAFT Healthcare

14


15-Jun-15 329 100% Medisupport S.A. N/A Sonic Healthcare Limited

08-May-15 N/A 100% Disch AG Ricola Familienholding AG Alrupa Finanz Holding AG

07-May-15 280 100% BASF SE, custom synthesis and parts of active pharmaceutical ingredients business

BASF SE Siegfried Holding AG

13-Apr-15 N/A 100% CAPP Medical, Inc. N/A Roche Holding AG

07-Apr-15 210 51% Neodent S.A. N/A Straumann Holding AG




22-Jun-15 Santhera Pharmaceuticals Holding AG

Product-related announcement

Santhera announced, that the European Medicines Agency's Committee for Medicinal Products for Human Use has recommended granting a marketing authorization for Raxone. This would add another biotech company with product sales in Switzerland

16-Jun-15 Lonza Group AG Business expansion Lonza plans to expand its viral gene therapy business by constructing a new 9,300 square meter facility; the facility will manufacture viral gene therapies and virally modified cell therapies

13-May-15 LifeWatch AG Product-related announcement

LifeWatch filed a 510K application with the US FDA for clearance of its LifeWatch Mobile Cardiac Telemetry patch, an ECG system; it will also be filing for CE Mark and other international clearances to market and provide its services globally

05-May-15 Ypsomed Holding AG Client announcement Ypsomed entered into an exclusive agreement to supply YpsoPen, an insulin injection system, to Lupin Limited, an Indian pharmaceutical company; previously Ypsomed has been supplying ServoPen, its spring driven injection pen, to Lupin since 2013

04-May-15 Cytos Biotechnology AG Business reorganization Cytos Biotechnology announced the regulatory approval of its convertible bond restructuring; in exchange for an incentive payment all bonds will be converted into equity and against a final payment, claims from the convertible bond notes holders will be eliminated

24-Apr-15 Ypsomed Holding AG Business expansion Ypsomed announced the expansion of its manufacturing capacity through an additional dedicated production line for manufacturing injection systems; the additional annual capacity will be in the double-digit millions and supplied to Sanofi starting late 2016

16-Apr-15 Novartis AG Product-related announcement

Sandoz received FDA approval for GlatopaTM, as the first generic competitor of Copaxone® 20mg for the treatment for relapsing forms of multiple sclerosis

01-Apr-15 Basilea Pharmaceutica AG Product-related announcement

Basilea Pharmaceutica signed an exclusive license agreement for worldwide rights to develop, manufacture and commercialize panRAF kinase inhibitors, developed at The Institute of Cancer Research



DRAFT Industrial Goods and Services

15



Margins (LTM) * Companies included in the Industrial Goods and Services Index

Legend


Industrial Goods and Services Index Swiss SMI Index (value weighted)

ABB Ltd. Adval Tech Holding AG Bobst Group SA Bucher Industries AG Burckhardt Compression AG Carlo Gavazzi Holding AG Cicor Technologies Comet Holding AG Dätwyler Holding Inc. DKSH Holding AG Feintool International Holding AG Flughafen Zürich AG

Georg Fischer AG INFICON Holding AG Interroll Holding AG Kaba Holding AG Kardex AG Komax Holding AG Kühne & Nagel International AG LEM Holding AG Looser Holding Meyer Burger Technology AG Mikron Holding AG OC Oerlikon Corporation AG

Panalpina World Transport Holding Ltd. Phoenix Mecano AG Rieter Holding AG Schaffner Holding AG Schindler Holding AG Schweiter Technologies AG SFS Group AG SGS SA Sulzer Ltd. Tornos Holding SA Von Roll Holding AG Walter Meier AG


1.2x

10.1x

15.0x

20.3x

3.0x

10.3x

12.7x

20.5x

0x

5x

10x

15x

20x

25x

30x


42.7%

11.6%6.2% 6.0%

33.8%

23.6%

15.3%11.1%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Gross margin EBITDA margin Earnings fromcontinued operations

margin

Net income margin

65%

80%

95%

110%

125%

140%

155%



DRAFT


Industrial Goods and Services


04-Jun-15 N/A 100% Precision Gas Turbine Inc. N/A Sulzer Ltd.

29-May-15 N/A 100% The Afifi Group N/A Panalpina World Transport Holding Ltd.

13-May-15 N/A 65% Nuova Gidue Srl N/A Bobst Group SA

30-Apr-15 1,214 100% Dorma Holding GmbH + Co. KGaA N/A Kaba Holding AG

27-Apr-15 N/A 100% PCT Engineered Systems LLC N/A Comet Holding AG

24-Apr-15 N/A 100% Colsein Ltda., process automation business N/A Endress+Hauser AG

22-Apr-15 N/A 100% Valora Warenlogistik AG Valora Holding AG 7Days Media Services GmbH

09-Apr-15 N/A N/A Trans Europa Express Holding AG N/A Constellation Capital AG

01-Apr-15 73 100% Franke Aquarotter GmbH, aerospace business Franke Aquarotter GmbH TransDigm Group Inc.


16


11-Jun-15 DKSH Holding AG Client announcement DKSH has expanded its existing relationship with AstraZeneca to provide marketing and sales services in Thailand and Cambodia; DKSH currently provides distribution and logistic services for AstraZeneca

12-May-15 BOBST Group SA Client announcement BOBST won an order from a Mexican paper manufacturer, Grupo Gondi, to supply even conversion lines for a greenfield site currently under construction in Nava, Mexico; the ordered lines include die-cutters and folder-gluers

09-May-15 ABB Ltd. Client announcement ABB won an order worth CHF 96.3m (USD 100m) for the supply of converter transformers and components including wall bushings and circuit breakers for the Lingzhou-Shaoxing ultrahigh-voltage direct current (UHVDC) transmission project in China

27-Apr-15 Rieter Holding AG Business expansion Rieter is to open the company's first Application & Research Centre for spinning technology in China; the center is expected to contribute towards the development of the Chinese spinning industry and marks Reiter's expansion plans in China

23-Apr-15 Comet Holding AG Strategic alliance Comet has partnered with Hexagon Metrology, the industrial measurement solutions company, to jointly develop technologies for precise measurements in industrial applications using X-ray and computed tomography

21-Apr-15 SFS Group AG Product-related announcement

SFS announced the introduction of a new machine-to-machine (M2M) solution for the Distribution & Logistics segment; the M2M solution unifies communications between a warehouse, handheld mobile devices, and ERP systems

13-Apr-15 Schindler Holding AG Executive/ Board change

Schindler has appointed Karl-Heinz Bauer as Chief Technology Officer, effective 1 June 2015; Karl-Heinz Bauer will be joining the company from Honeywell Transportation Systems where he has been Chief Technology Officer since 2007

09-Apr-15 Meyer Burger Technology AG

Strategic alliance Meyer Burger entered into a strategic collaboration with CEA, a leading French research facility, to carry out joint research on solar technology; additionally Meyer Burger received an order over CHF 12m for its photovoltaic technology from CEA



DRAFT Media, Technology and Telecommunications

17



Margins (LTM) * Companies included in the Media, Technology and Telecommunications Index

Legend


Media, Technology & Telecomm. Index Swiss SMI Index (value weighted)

ALSO Holding AG Ascom Holding AG Crealogix Holding AG Goldbach Media AG Huber+Suhner AG Kudelski SA Logitech International SA Micronas Semiconductor Holding AG Myriad Group AG

Orell Füssli Holding AG Sunrise Communications Group AG Swisscom AG Swisslog Holding AG Tamedia AG Temenos Group AG u-blox Holding AG


1.3x

10.2x

15.6x

24.9x

3.0x

10.3x

12.7x

20.5x

0x

5x

10x

15x

20x

25x

30x


32.6%

14.3%

6.4% 6.0%

33.8%

23.6%

15.3%11.1%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Net income margin

65%

80%

95%

110%

125%

140%

155%



DRAFT Media, Technology and Telecommunications



12-Jun-15 N/A 100% Born Informatik AG N/A adesso Schweiz AG

08-Jun-15 N/A 100% IDG Communications AG, Zurich International Data Group, Inc. Verlagsgruppe Ebner Ulm

04-Jun-15 N/A 100% mPortal, Inc. New Venturetec AG BroadSoft, Inc.

22-May-15 N/A 100% Timefinity Group Limited N/A QUADROtech Solutions AG

20-May-15 N/A 100% HartterGruppe GmbH N/A Axxiome AG

11-May-15 N/A 100% asim GmbH N/A Stämpfli AG

06-May-15 N/A 100% Technet-Rail 2010 GmbH N/A Leica Geosystems AG

28-Apr-15 N/A 100% KCS.net Holding AG The Carlyle Group LP Avanade Inc.

20-Apr-15 N/A 100% bab.la GmbH High-Tech Gründerfonds Management; Mountain Partners; BVP Berlin Venture

Oxford University Press Ltd.


18


25-Jun-15 Tamedia AG Business expansion Swiss competition authority WEKO approved the acquisition of car4you.ch by Tamedia

09-Jun-15 Kudelski SA Strategic alliance Kudelski signed a multi-year patent licensing agreement to cross license Kudelski’s patent portfolio with Bloomberg Finance LP. against a one-time payment

13-May-15 Micronas Semiconductor Holding AG

Strategic alliance Micronas has extended their global franchise agreement with Rutronik Elektronische Bauelemente GmbH to the entire Micronas Hall-effect sensor and embedded motor controller product range; Rutronik has been a Micronas distribution partner for 15 years

12-May-15 Huber+Suhner AG Business reorganization Huber+Suhner announced structural measures to deal with the negative effects of the strong Swiss Franc; these measures include relocating certain services and logistics functions to Poland and the relocation of its center of excellence Space-flight to the US

12-May-15 Temenos Group AG Business expansion Temenos opened its new Nordic headquarters in Copenhagen, Denmark, as a part of its business expansion strategy; the office will be headed by Steen Jensen currently in-charge of Northern Europe for Temenos

08-Apr-15 u-blox Holding AG Product-related announcement

u-blox has introduced TOBY-L280, its first LTE Category 4 rugged module in an LGA package that supports FDD-LTE in frequency band 28; the module can support download speeds of up to 150Mb/s and is the fastest and smallest of its kinds

01-Apr-15 Ascom Holding AG Client announcement Ascom has won a multi-year contract worth CHF 1.2m (NOK 10m) per year from Bærum Municipality in Norway to implement its new nurse call system for several residential centers, nursing homes and assisted living facilities in the municipality

01-Apr-15 Swisscom AG Product-related announcement

Swisscom has introduced a new brand "Wingo“, targeting urban residential customers to increase its subscriber base; the offering provides fixed network services under a reduced, simplified offering and low cost model in areas of fibre-to-the-home coverage



DRAFT Retail and Consumer Products

19



Margins (LTM) * Companies included in the Retail and Consumer Products Index

Legend


Retail and Consumer Products Index Swiss SMI Index (value weighted)

ARYZTA AG Barry Callebaut AG Bravofly Rumbo Group N.V. Calida Holding AG Charles Vögele Holding AG Compagnie Financière Richemont SA Dufry AG Emmi AG

Hügli Holding AG Kuoni Reisen Holding AG Metall Zug AG Mobilezone Holding AG Nestlé SA Orior AG Swatch Group AG Valora Holding AG


1.1x

8.7x

13.6x

18.4x

3.0x

10.3x

12.7x

20.5x

0x

5x

10x

15x

20x

25x

30x


44.0%

11.7%6.0% 5.8%

33.8%

23.6%

15.3%11.1%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Net income margin

65%

80%

95%

110%

125%

140%

155%



DRAFT Retail and Consumer Products

20



22-Jun-15 N/A 100% Kuoni Reisen Holding AG, European tour operating businesses

Kuoni Reisen Holding AG DER Touristik Köln Gesellschaft mbH

08-Jun-15 N/A 100% American Almond Products Company, Inc., certain assets

N/A Barry Callebaut AG

05-Jun-15 N/A 100% Bormioli Rocco S.p.A, glassworks In Italy Bormioli Rocco S.p.A Vetropack Holding AG

18-May-15 N/A 100% EGV Unna AG N/A Transgourmet Holding AG

05-May-15 N/A 100% ExecuJet Aviation Group AG International Investment & Underwriting Limited

Luxaviation S.A.

29-Apr-15 N/A 100% EHC Kloten Sport AG Philippe Gaydoul Avenir Sports Entertainment LLC

22-Apr-15 N/A 30% Galaxus AG N/A Migros-Genossenschaft

21-Apr-15 N/A 100% Swiss Online Shopping AG N/A Tamedia AG



10-Jun-15 Barry Callebaut AG Executive/ Board change

Barry Callebaut appointed Antoine de Saint-Affrique as new CEO, effective 1 October 2015, succeeding Juergen Steinemann, who was elected Vice Chairman of the Board of Directors in December 2014

21-May-15 Dufry AG Business expansion Dufry won a tender offer for a license agreement to operate nine new duty free shops at Nice Côte D’Azur Airport; under the license agreement Dufry will operate 968 m² of retail space for seven years starting in 2016

19-May-15 Dufry AG Fixed-income offering Dufry AG and Dufry Financial Services B.V. launched an offer outside the United States to convert any or all of the CHF 275m principal amount of 2% Dufry mandatory convertible notes due 18 June 2015

15-May-15 Valora Holding AG Product-related announcement

Valora announced that its Valora ok.- brand products go on sale at more than 100 outlets in French-speaking Switzerland; initially the offering will comprise three ok.- energy drinks (Classic, Zero and Mango), as well as ok.- cola energy and ok.- beer

20-Apr-15 Kuoni Reisen Holding AG Executive/ Board change

Kuoni Reisen appointed B. Selina Neri as a new Member of the Board of Directors; Selina Neri will replace Raymond Webster, who did not stand for re-election

14-Apr-15 lastminute.com NV. Executive/ Board change

lastminute appointed Francesco Guidotti, as the new CFO of the group, effective 1 May 2015; Francesco Guidotti is currently serving as the CFO at YOOX and will replace Gaspar Santonja, who is leaving lastminute to pursue other business opportunities



DRAFT

Deal rationale*

► The merger is to allow both companies to offer their customers one-stop-shopping for security and access-control solutions, due to complementary product portfolios, value chains and geographical presences. Through the combination, dorma+kaba plans to achieve an enhanced revenue growth of 6-7% annually.

► The potential cost synergies through increased purchasing volumes, optimized infrastructure costs and efficiency increases are being valued at CHF 60-70m per year. The full realization of these synergies is expected four years after the merger.

► The CEOs of both companies highlight the strategic fit of the merger and value creation potential for share- and stakeholders.

21

Transaction overview

Deal summary*

On 30 April 2015 the Swiss KABA Holding AG and the German Dorma Holding GmbH + Co. KGaA announced their planned merger to become one of the largest security and access-control solution companies under the name of dorma+kaba. The current merger structure foresees the integration of KABA’s operations into Dorma in exchange for a 52.5% stake. The merger has been approved by the shareholders general meeting of KABA and is planned to be completed in the third quarter 2015.

The combined operations of dorma+kaba would have a pro-forma revenue of more than CHF 2bn, which would make it the third largest company on the global market for security and access-control solutions. The companies plan to achieve cost synergies of CHF 60-70m per year and target an EBITDA margin of 18%.

Relative stock performance (in %)

Deal timeline* Consideration details*

# Date Event

1 30-Apr-2015 Kaba Holding and Dorma Holding announce merger plans to create Dorma + Kaba Group

2 22-May-2015 Shareholders of Kaba approve the merger agreement with Kaba

EBITDA = Earnings before Interest, Tax, Depreciation and Amortization LTM = Last Twelve Months Rev. = Revenue TEV = Total Enterprise Value

Valuation analysis (LTM)

Deal of the quarter

Net transaction value (CHF m) 1,214

Implied enterprise value (CHF m)

1,214

% sought 100%

Total cash 0%

Total stock 100% *Based on publically available information sourced from Capital IQ.


1

2

80%

90%

100%

110%

120%

130%

140%

150%

Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15

Swiss Market Index Kaba

1.7x

3.0x

0x

2x

4x

6x

8x

TEV/ Rev.

Chemicals, Construction & Materials Swiss Market Index

1.2x

Implied Enterprise Value

11.7x

10.5x

0x

4x

8x

12x

16x

20x

TEV/EBITDA

Chemicals, Construction & Materials Swiss Market Index

10.1x

Implied Enterprise Value


DRAFT

Date Day Time Event topic Host Location

09-Oct-2015 Friday 09.00 – 17.00 Valuation (E) EY Geneva

30-Oct-2015 Friday 09.00 – 17.00 Financial Modeling in Excel (E) EY Geneva

12-Feb-2016 Friday 09.00 – 17.00 Financial Modeling in Excel (D) EY Basel

22-Apr-2016 Friday 09.00 – 17.00 Valuation (D) EY Zurich

06-May-2016 Friday 09.00 – 17.00 Financial Modeling in Excel (D) EY Zurich

Event calendar

22

Events from Jul to Sep 2015

Upcoming EY corporate finance seminars*

D = German; E = English

*Registration details can be found on page 25.

Date Day Time Event topic Host Location

01- Jul-2015 Wednesday 19.00 - 23.00 Young SECA Summer Event @ SUSI SECA Zurich

08-Jul-2015 Wednesday All day 14. SECA Private Equity & Corporate Finance Conference SECA Zurich

01-Sep-2015 Tuesday 11.30 – 14.00 CEO Luncheon with Christoph Loos, Member of the Executive Board, Hilti AG

Swiss-American Chamber of Commerce Zurich

01-Sep-2015 Tuesday 09.15 – 17.00 18. Zurich conference Mergers & Acquisitions Europa Institute at the University of Zurich

Zurich

09-Sep-2015 Wednesday 11.30 – 14.00 Meet the Leader Luncheon Heinz Karrer President, economiesuisse

Swiss-American Chamber of Commerce Geneva

09-Sep-2015 Wednesday 14.00 – 18.00 50th Swiss Venture Day CTI Invest Zurich



DRAFT EY selection of M&A opportunities

23

Selected M&A opportunities

*Deal size is available upon request.

Note: A high number of additional local and global opportunities are available upon request.

Industry Region Transaction (sale of)/private placement Project Approx. deal size (in USD m)

<50 50-150 >150

Chemicals, Construction and Materials Asia A west India based cement company engaged in manufacturing special cement Cement * * *

Chemicals, Construction and Materials Asia Russian pesticide producer Pesticide √

Energy and Utilities Europe Local oil & gas company Agate √

Energy and Utilities Europe Oil & gas exploration and production company Georgia √

Energy and Utilities Europe Integrated solutions provider in the smart metering/ energy efficiency systems market Opal √

Energy and Utilities Europe Distribution and commercialization of energy Dillon √

Healthcare Asia Manufacturer of animal healthcare products Rose √

Healthcare Europe Pharma wholesaler in the Ukraine DashBent √

Healthcare Europe Application system providing critical information used for the early detection of Alzheimer's Alois * * *

Industrial Goods and Services Asia Manufacturers of high quality plastic bottles, caps, jars and containers Mystic √

Industrial Goods and Services Asia Producing gold field in Aktobe region of Kazakhstan Gold √

Industrial Goods and Services Europe Gas production technology Ekko √

Industrial Goods and Services Europe Sale of rig inspection company Walkabout √

Industrial Goods and Services Europe Design and manufacture of surface handling equipment Rig √

Industrial Goods and Services Europe Producer of switch-gear cubicles and gas-insulated ammeter transformers Edison √

Media, Technology & Telecomm. Europe Provider of IT outsourcing services EDB √

Retail and Consumer Products Asia Producer of tea Miracle √

Retail and Consumer Products Europe Car dealer group Le Mans √

Retail and Consumer Products Europe Distributor of refrigerated juice drinks Sucus √



DRAFT Contacts

24

Ronald Sauser Managing Director | Head M&A Advisory Phone +41 58 286 42 04 Mobile +41 58 289 42 04 Email [email protected]

Thomas Korzec Manager Phone +41 58 286 37 91 Mobile +41 58 289 37 91 Email [email protected]


Authors of this publication

For questions about this publication or to benefit from EY’s comprehensive transaction experience and global network, please do not hesitate to contact us.


DRAFT

Name Kathrin Wagenhofer

Ernst & Young Ltd

Maagplatz 1

8010 Zurich

Phone +41 58 286 30 79

Fax +41 58 286 30 04

[email protected]

Company name

Address

Postal code, city

Email

Subscription/Registration form

25

Subscription to Mergers & Acquisitions Quarterly Switzerland

If you would like to receive this publication on a regular basis, please fill out the form below and return it to Kathrin Wagenhofer or contact her directly. The subscription is free of charge and can be canceled at any time.

Registration for EY corporate finance seminars

If you would like to register for or receive more information regarding our Valuation or Financial Modeling seminars, please fill out the form below and return it to Kathrin Wagenhofer or contact her directly.

□ Yes, I would like to receive more information on the following seminar(s)

□ Yes, I would like to register for the following seminar(s) □ Valuation (24-Apr-2015, ZH, D, *) □ Financial Modeling (08-May-2015, ZH, D, *) □ Valuation (09-Oct-2015, GE, E, *) □ Financial Modeling (30-Oct-2015, GE, E, *)

Legend: ZH = Zurich, GE = Geneva, BA = Basel; D = German, E = English; * = Seminar fee CHF 1,200

□ Yes, I would like to receive EY’s Mergers & Acquisitions Quarterly on a regular basis

□ electronically via email □ as a hardcopy via Swiss Post

Name Kathrin Wagenhofer

Ernst & Young Ltd

Maagplatz 1

8010 Zurich

Phone +41 58 286 30 79

Fax +41 58 286 30 04

[email protected]

Company name

Address

Postal code, city

Email



DRAFT About the M&A Quarterly Switzerland

26

General information

► The information in this booklet is based on data provided by S&P Capital IQ, other external data providers as well as EY research.

► While we have carefully selected and reviewed the data, M&A statistics are strongly dependent on the source providers. We do not assume any liability for the accuracy of the information provided. Statistics presented in this booklet should only be regarded as estimates.

Transaction criteria

For the purposes of this booklet, transactions were defined by the following criteria:

► Swiss-based seller, buyer or target.

► Announcement in a given quarter, but transaction might have not yet closed.

► Minority or majority stakes, as long as change of control results from the transaction.

Furthermore, transactions were:

► Included irrespective of their size, including deals with undisclosed transaction volume.

► Allocated to the respective industry based on the target’s industry classification.

► Included if announced by and valued using market data as of 24 June 2015.

► Sourced from S&P Capital IQ, other external data providers and EY Research.


EY | Assurance | Tax | Transactions | Advisory

About the global EY organization

The global EY organization is a leader in assurance, tax, transaction and advisory services. We leverage our experience, knowledge and services to help build trust and confidence in the capital markets and in economies all over the world. We are ideally equipped for this task – with well trained employees, strong teams, excellent services and outstanding client relations. Our global purpose is to drive progress and make a difference by building a better working world – for our people, for our clients and for our communities.

The global EY organization refers to all member firms of Ernst & Young Global Limited (EYG). Each EYG member firm is a separate legal entity and has no liability for another such entity’s acts or omissions. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

For more information, please visit www.ey.com.

EY’s organization is represented in Switzerland by Ernst & Young Ltd, Basel, with ten offices across Switzerland, and in Liechtenstein by Ernst & Young AG, Vaduz. «EY» and «we» refer to Ernst & Young Ltd, Basel, a member firm of Ernst & Young Global Limited.

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mergers & acquisitions quarterly switzerland - second quarter 2015

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