1THE ECHO July 2009

THE ECHOTHE MAGAZINE OF THE MAN FERROSTAAL GROUP

JULY 2009

ComprehensiveOn assembly expertise for large projects

InnovativeOn re-positioning in the service business

AspiringAll about Chinas growing economy

A giant made of pure steel: the Zayzoun combined cycle power plant in Syria has a cooling tower measuring 140 metres high and 110 metres in diameter.

Cover picture: MAN Ferrostaal supplies special pipes to the oil & gas industry.

EdItorIAl

Dr. jur. Matthias Mitscherlich, Chief Executive Officer of MAN Ferrostaal AG

Despite the economic crisis, we have got off to a good start in 2009. Our order books have never been fuller, which means that the prospect of continuing the recent years positive trend is bright. But more than that: We are set for growth. Further large orders will come our way, due to our modified ownership structure in which the new owner, IPIC, is the majority stakeholder with a share of 70 percent. Because MAN Ferrostaal is a core business of IPIC, we are ideally placed to realize our ambitious turnover target of four billion euros in 2013. For instance, IPIC is planning to include us in a multi-billion project in Abu Dhabi. This in-volves a chemical city which, in its final manifestation, will be similar in magnitude to BASF in Ludwigshafen. Also on the agenda are joint projects in Central Asia and Northern Africa. As a way of perpetuating this trend, we are pres-ently establishing a joint venture in Abu Dhabi together with our parent company.

We are glad to have remained relatively unaffected by the recession so far, and hope our luck will persist. Region-ally and in terms of sectors, we are well-positioned and focussed on areas such as power, petrochemicals, solar and services which will continue to be a high priority in future. So far, our diversified structure has enabled us to more or less offset the current losses made in particular by our Automotive business unit and machine business. In both areas, we have introduced measures to ensure greater stability during any future slumps. Providentially, we have

started widening our base and supplementing our portfo-lio with additional products and services along the value added chain already two years ago.

Whereas many companies are currently being forced to dis-miss staff, we were fortunate enough to recruit about 200 new employees last year and presently have 40 job vacan-cies. Because we pursue a model of high yield by relatively small numbers of experienced employees, it is important to us to hire proven professionals. Consequently, we pro-vide training and further education which ranks alongside the best internationally. Amongst all the German plant engineering companies, for instance, we have the largest number of independently certified project managers. This explains our appeal both as a partner for customers, and as an employer for staff.

Yours sincerely,

Dr. Matthias MitscherlichChief Executive Officer

Dear Readers,

3THE ECHO July 2009

CoNtENtS

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SErvICESBasis of a strong foreign organisationThe signs for our service business show a promise of growth: Products for the future have been added to the portfolio, services have been extended along the value added chain, and our international presence has been re-inforced. The focus here is on the needs of the customer.

ProjECtSTailored projects from a single sourceEvery large project is planned and executed on an in-dividual basis. Having acquired international renown in this field, MAN Ferrostaal is the industrial services provider for customers seeking complete solutions, in many cases ranging from financing and project devel-opment through to project management right up to independent design and construction.

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NEWSInteresting company news at a glance: Topics this time include financial closing, a sponsorship project in Palestine, Ferrostaals printing machine business, the new Supervisory Board and a higher share in the Solar Power Group.

ForUMAdaptability will determine future success In an interview, Executive Board member Dr. Klaus Lesker describes the opportunities that the new own-ership structure presents in terms of large orders and cooperative ventures.

Its all about peopleProgrammes for human resources development such as project management certifications in line with international standards are given the highest consideration at MAN Ferrostaal.

ProjECtSHeading for success together The IPIC Ferrostaal Contracting joint venture is to implement future complex plant construction projects in the petrochemical, oil & gas, power and solar sectors in the MENA region.

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THE ECHO July 2009 5

Outstanding construction competenceMAN Ferrostaal is a reliable partner for its custom-ers, supervising project development and project management while also taking on overall responsi-bility for complete construction for a great number of its projects.

MIlesTOnes In pIcTures: power plant extension in Iran Project development for a power plant extension in Bandar Imam Khomeini in Iran, presented in eight pictures.

SErvICESAmbitious orientation with attractive portfolioMAN Ferrostaals new Service Platform stands for growth and opportunity in the machinery busi-ness. In a short interview, Executive Board member Joachim Ludwig also talks about the significance of the service business for IPIC.

Innovative concepts are in demandMAN Ferrostaal has to be flexible and innovative for the demanding global machinery business. Heads of subsidiaries from five continents report on their mar-kets and their opportunities.

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CoUNtrIES ANd PEoPlEcOunTry specIAl: cHInATechnology to and from china The Chinese market is regarded as a sheet anchor in the economic crisis. MAN Ferrostaal has long been an im-portant player in the machinery trade in this market.

The versatility of a lightweightIn China, there is great potential for growth in alu-minium foil production. As a supplier of rolling mills, MAN Ferrostaal is making a significant contribution.

Business etiquette guide: china part 1 In order to avoid mishaps when doing business in China, a number of rules should be observed: the most important tips for a perfect business meeting.

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NEWS

Since March 25, 2009, International Petroleum Invest-ment Company (IPIC) from Abu Dhabi has owned a 70 percent stake in MAN Ferrostaal; the majority share was ac-quired retroactively from January 1, 2008. MAN continues to own a share of 30 percent. The share purchase contract became effective following approval by international car-tel authorities and the EU commission. Call and put op-tions are available for the remaining 30 percent. Until such time as these are realised, the name MAN Ferrostaal can be retained. The portfolio will remain unchanged and the company will continue to be managed independently.

IPIC is a sovereign wealth fund based in Abu Dhabi and engaged in long-term investments, especially in the MENA region, Europe and Asia. As part of expanding its sphere of influence, this fund intends to benefit from MAN Ferrostaals general portfolio and international net-

work. In this connection, however, IPIC sees itself not only as a new owner, but also as a client. Promising, large-scale projects have been planned for MAN Ferrostaal, includ-ing participation in the construction of ChemaWEyaat, a huge petrochemical plant in Abu Dhabi. MAN Ferrostaal will also play a leading role in other major projects in the areas of petrochemicals, power and renewables. MAN Ferrostaal is a core business of IPIC. This is the best pos-sible precondition for further growth. Investing in petro-chemical and power plants itself, IPIC is an ideal partner for our businesses involving large-scale facilities, states Dr. Matthias Mitscherlich, CEO of MAN Ferrostaal, with regard to the takeover.

IPIC becomes majority stakeholder

Signing of the contract was celebrated officially in Abu Dhabi in January of this year. From left to right: Prof. Dr. h.c. Karlheinz Hornung, CFO of MAN, Dr. Matthias Mitscherlich, CEO of MAN Ferrostaal, Hkan Samuelsson, CEO of MAN and H.E. Khadem Al Qubaisi, Managing Director of IPIC.

7THE ECHO July 2009

MAN Ferrostaal sponsors an initi-ative entitled A future for Pal-estine. The industrial services provid-er based in Essen is helping finance the construction of a solar heating system for the Talitha Kumi school situated in the community of Beit Jala, twelve kilo-metres south of Jerusalem. Compris-ing grades one to twelve, this school is visited by roughly 900 students striv-ing to obtain the Tauwjihi, the equiv-alent of a British A-level qualification. The private school is affiliated with a girls boarding school, preschool and college of higher education.

Under the financial responsibility of the Berlin Mission, the school relies on regular donations in view of the coun-trys struggling economy. Up to now, water and room heating have made up a significant portion of annual fixed

costs. This will change through the in-stallation of a solar facility for supply-ing the necessary heat. Mounted on the schools roof, the solar heating sys-tem will save several thousand litres of diesel fuel in future. Implementing this project in cooperation with sys-tem supplier Vaillant, MAN Ferrostaal is bearing most of the costs. The facil-ity is to be commissioned as early as September 2009.

Founded in 2008 by German Foreign Minister Steinmeier and Palesti