Migros Ticaret A.s. · BIST:MGROS

Migros Ticaret A.s — Merger or Acquisition (June 2016)

13 slides from Migros Ticaret A.s's merger presentation, June 2016

  1. Slide 1: Tesco Kipa Acquisition Roadmap

    Migros Ticaret A.Ş. Tesco Kipa Acquisition Roadmap June 2016

  2. Slide 2: Disclaimer Statement

    Disclaimer Statement Migros Ticaret A.Ş. (the “Company”) has prepared this presentation for the sole purpose of providing information about its business, operations and financial results. The information in this presentation is subject to updating, revision and amendment. The information in this pre

  3. Slide 3: Agenda

    Agenda ∎ Transaction Overview ∎ Overview of Kipa ∎ Strategic Rationale ∎ Way Forward for Kipa ∎ Expected Financial Impact ∎ Summary 2

  4. Slide 4: Acquisition of 95.5% stake in Tesco Kipa

    Acquisition of 95.5% stake in Tesco Kipa  Migros entered into an agreement with Tesco Overseas Ltd to acquire its c.95.5% stake in Tesco Kipa (1) Transaction − 168 stores with total net sales area of 324k sqm Overview − Including real estate property portfolio of 303k sqm with significant third par

  5. Slide 5: Overview of Kipa

    Overview of Kipa Summary Business Overview Net Sales Area (2) Express 5%  Modern grocery retailer focused on the Western regions of Supermarkets Hypermarkets 13% 39% Turkey with 168 stores, total sales of TL 2,247 million (1) and net sales area of ~324k sqm, comprising − 17 Hypermarkets >6,000 sqm

  6. Slide 6: Kipa Store Portfolio and Formats

    Kipa Store Portfolio and Formats Store Portfolio by City Formats 1 Express 1 1  No. of stores: 72 1 24 1 7  Avg size: 234 sqm 1 6 1 2 1 2  Total sales area: 16,877 sqm 1 2  Proximity supermarkets 2 1 2 1 3  Located in residential and business areas 2  Provides basic fresh and retail products 3

  7. Slide 7: Strengthens competitive position and leverage scale benefits

    1 Strengthens competitive position and leverage scale benefits Apply Migros' proven and tested ‘full range’ formats to Kipa’s portfolio of well-established and well- located shopping destinations Provide compelling format proposition addressing Turkey’s demographics and growing middle class Gain cri

  8. Slide 8: Significant real estate content increases operational flexibility

    2 Significant real estate content increases operational flexibility Kipa owns 37 retail real estate properties (1) with 303k sqm of total retail space 26 of the properties are shopping malls including significant third-party leased sales area adjacent to a Kipa store being an anchor İzmir - Çigli İz

  9. Slide 9: Local operational excellence allows for improved cost control

    3 Local operational excellence allows for improved cost control Leveraging of Migros’ long-term relationships with local suppliers, localised category management and savings from centralised logistics (67-70% for Kipa vs. 84% for Migros) Application of Migros‘ best operating practices to Kipa stores

  10. Slide 10: Proven track record of integrating and right sizing stores in Turkey

    4 Proven track record of integrating and right sizing stores in Turkey Significant step forward in Migros’ long term expansion plans Format adoption, store transformations and rebranding as well as store rollouts are part of Migros’ DNA Based on deep understanding of Turkish food retail market Prove

  11. Slide 11: Way Forward for Kipa

    Way Forward for Kipa 1  Restructuring of Kipa’s store portfolio leading to sales area reduction, including − Gradual right sizing of certain locations Restructuring of  Adoption of Migros’ proven and tested ‘full range’ formats Store Portfolio  Refurbishment of certain shopping malls  Opportunis

  12. Slide 12: Expected Financial Impact

    Expected Financial Impact  Supports Migros’ double digit sales growth guidance P&L  Improvement of Kipa’s sales/sqm efficiency by right sizing of net sales area and Impact efficiency initiatives  Target neutral pro forma EBITDA margin impact within 2 years after closing  LTM Mar-16 Proforma Net

  13. Slide 13: Summary

    Summary 1 1. Strengthens competitive position and leverage scale benefits 3. Significant real estate content increases operational flexibility 2 4. Local operational excellence allows for improved cost control 3 5. Proven track record of integrating and right sizing stores in Turkey 4 12

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