Gmm Pfaudler Limited · NSE:GMMPFAUDLR
Gmm Pfaudler — Merger or Acquisition (September 2020)
43 slides from Gmm Pfaudler's merger presentation, September 2020
Slide 1: September 2020
September 2020
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by GMM Pfaudler Limited (the "Company’) solely for your information and for your use and may not be taken away, distributed, reproduced, or redistributed or passed on, directly or indirectly, to any other person (whether within or outside your organizat
Slide 3: Defining the Standard — Together
Defining the Standard — Together GMM Pfaudler Pfaudler International GMM Pfaudler, the Indian leader in Building on a trusted relationship of over Glass Lined Equipment, to acquire a 30 years between GMM Pfaudler and majority stake in the global business Pfaudler International, the transaction of Pf
Slide 4: About GMM Pfaudler
About GMM Pfaudler GMM Pfaudler™ ng the standard
Slide 5: Well-Established Player with a Dominant Market Share
Well-Established Player with a Dominant Market Share \_ With over five decades of manufacturing experience, GMM Pfaudler has established itself as the market leader in the Glass Lined technology industry in India shop for high-quality corrosion-resistant chemical process equipment for the chemical a
Slide 6: Our Business Lines — Much More than Glass Lined
Our Business Lines — Much More than Glass Lined GLASS LINED EQUIPMENT HEAVY ENGINEERING FILTRATION & DRYING ENGINEERED SYSTEMS & ACID RECOVERY MIXING SYSYTEMS Broad range of Experience in PRES WEIN OMS ta technologies, solutions fabricating tailor-made Gitiivell endl commaltax deci iP in and service
Slide 7: Stable and Diversified Customer Base
Stable and Diversified Customer Base PHARMACEUTICALS ; ¢ . anton WSN? HTKAL Cipla e 9 torrent Dr.Reddy’s SUN fe] HETERO SUVEN iorent = Pharmaceuticals =Chemicals = Others oO a Total: INR 5.9 bn pra GLE Customer Concentr ® INDUSTRIES H H «ny & r ! BAYER) a A ' “) seston CLARIANT frases, | BENZO CHEM
Slide 8: Expanding Operational Footprint to meet Dynamic Growth Outlook
Expanding Operational Footprint to meet Dynamic Growth Outlook 8 vers i Organic growt! key industries served CHEMICALS a * Implementation of stringent environmental regulations in China likely to accelerate shift of manufacturing to India * Government impetus * Supportive structural drivers like loc
Slide 9: Operational Excellence and a Proven Track Record in Successful M&A Integration
Operational Excellence and a Proven Track Record in Successful M&A Integration * Operational Excellence a corner stone of improving revenue and profitability over the last S years * Project Shakti completely transformed our production model and significantly improved throughput * Low cost sourcing f
Slide 10: Robust Financial Performance
Robust Financial Performance Financials (INR mn) CAGR: 187% Ot S,026 Leverage (INR mn) FY19 3590 4,057 LI Ee | (1,008) FYI7 FY18 FY19 FY20 (1165) (1,230) mmm Revenue (INR mn) —-EBITDA Margin @®> ‘er deve /eBiTDA Earnings per share (EPS) m Net Debt (INR mn) 26.6% 27.2% 26.9% 227% oe . . — — 1a 3% 207
Slide 11: About Pfaudler International
About Pfaudler International GMM Pfaudler™ Defin’ng the standard
Slide 12: Global Champion in Corrosion-Resistant Technology
Global Champion in Corrosion-Resistant Technology @ ' Pfaudler International is the global leader for corrosion-resistant technologies, systems and related services catering to the — | specific needs of customers in the chemical and pharmaceutical industries ' Besides Pfaudler-branded Glass Lined Eq
Slide 13: Broad and High-Quality Product Portfolio
Broad and High-Quality Product Portfolio Ability to combine technologies, systems and services to provide holistic solutions to the customer TECHNOLOGIES SYSTEMS SERVICES * Engineering, installation, maintenance & * Turnkey solutions covering pharma, energy, after sales services: Strong partner for
Slide 14: Key Investment Highlights
Key Investment Highlights i Global leader in Global leader in an oligopolistic niche market with >20% market share t an attractive and Attractive market dynamics with expected annual growth of 3-5% in the global chemical ' f growing market industry and 6% in the global pharmaceutical industry Fully
Slide 15: Loyal and diversified customer base
Loyal and diversified customer base \_ Low concentratio top cu ablished relati O-BASF BACHEM __ syngenta We create chemistry fd ura Fo eras Blue chip @ \ | customer LANXESS CLARIANT cesk] base Ub NOVARTIS = Americas . EEE = Asia } Customer Concentration? | Concentration about 70% of top customers ar
Slide 16: Significantly Modernized Plant Footprint
Significantly Modernized Plant Footprint Significant investments in Global production footprint with 10 | modernization of production footprint! Pfaudler International plants across 4 with over USD 23 mn capex spent continents during last 4 years on new plants in Germany, Italy and China 3 New state
Slide 17: Financial Overview
Financial Overview ) Adjusted EBITDA” (USD mn) 174 176 17s 14 i 9 8 FY18 FY19 9m-May'20 FY20E FY18 FY19 9m-May'20 FY20E mm Revenue (USD mn) —— Gross Margin mam EBITDA (USD mn) —— EBITDA Margin ed revenue growth in recent years , as operational focus during last two years was on site moderniza Italy)
Slide 18: Transaction Overview
Transaction Overview GMM Pfaudler™ Defin’ng the standard
Slide 19: GMM Pfaudler Acquisition of Pfaudler International
GMM Pfaudler Acquisition of Pfaudler International Current Ownership Structure? GMM Pfaudler (“GMM") to acquire 54% of Pfaudler International (excl. stake in GMM) 100.0% Pfaudler International ' Patel family, currently largest shareholders in GMM apart from | ' Pfaudler International, to acquire a 2
Slide 20: Transaction Overview
Transaction Overview No equity dilution in GMM Pfaudler for the acquisition The transaction is subject to \ \ I I ' shareholder's approval, the satisfaction fl Stake acquired by GMM Pfaudler 54.0% I { of certain closing conditions, and ! Stake value acquired by GMM Pfaudler 274 ! ' Gustiennarny Kegu
Slide 21: Compelling Transaction Rationale — Key Highlights
Compelling Transaction Rationale — Key Highlights 21 Transform GMM Pfaudler into the undisputed global leader in the highly attractive market for anti-corrosion technologies Realize synergies through cross-selling initiatives and GMM’s lean-production model and low steel vessel costs to improve prof
Slide 22: Transform GMM Pfaudler into the undisputed global leader (1/2)
Transform GMM Pfaudler into the undisputed global leader in the highly attractive market for anti-corrosion technologies (1/2) #1 Global Glass Lined Equipment Producer Global Production and Sales Footprint 247 170 44 = GMM Competitor 1 Competitor 2 Competitor 3 Pro Forma * 12 well-invested productio
Slide 23: Transform GMM Pfaudler into the undisputed global leader (2/2)
1 Transform GMM Pfaudler into the undisputed global leader in the highly attractive market for anti-corrosion technologies (2/2) State-of-the-Art Production Facilities Taubate, Brazil = Glass Lined Equipment Avondale, USA = Fluoropolymers Rochester, USA * Glass Lined Equipment IImenau, Germany " Gla
Slide 24: Realize synergies through cross-selling and lean production
2 Realize synergies through cross-selling initiatives and GMM ss lean production model and low steel vessel costs to improve profitabilit across the entire group 24 a © Steel Cost Savings 34 Operational Excellence Production Cost Advantages GMM developed and implemented own operational excellence mo
Slide 25: Combine complementary portfolio of adjacent businesses
3 Combine complementary portfolio of adjacent businesses to diversify the strong Glass Line business 25 Y Leadership in Technologies segment to = Glass Line Equipments-|- - - 10% of GLE be reinforced ix! is Gi = Heavy Engineering v Complementary adjacent products i> Oo} Technolog provide cross-selli
Slide 26: Join forces in R&D to secure innovation leadership
4 Join forces in R&D to secure the group’s global innovation leadership 26 4 - care) es | Coordinated approach to combine Pfaudler International's strong innovation tradition with * Innovative, patent-pending Glass Lining technology for T 1 GMM’s successes in expanding reactors with thinner adhesive
Slide 27: Combine experienced management teams to execute the joint vision
5 Combine GMM’s and Pfaudler International’s experienced management teams to execute the joint vision 27 ghly Experienced Management Te Tarak Patel , Managing Director, GMM Pfaudler Thomas Kehl, CEO Pfaudler International * CEO of Pfaudler International since 2016 + Previously President and CEO of C
Slide 28: Pro Forma Financials of Combined Business (Unaudited)
Pro Forma Financials of Combined Business (Unaudited) \_f Expectations on future performance Particulars 9 months as per management August financial year ®) on May 2020 * Consolidated revenue of ~INR 20 bn and * Additional cross-selling revenue synergies Net Income excluding Non- controlling interes
Slide 29: Appendix A: Additional Information on Pfaudler International
Appendix A: Additional Information on Pfaudler International GMM Pfaudler™ ng the standard
Slide 30: Strong Mid-Term Growth Expected Across End-Markets Globally
Strong Mid-Term Growth Expected Across End-Markets Globally - Strong current momentum in global Chemicals and Pharmaceutical industries * Expected mid-term growth of 3-6% p.a. across sectors - Limited Covid-19 impact shows resilience through 61% the cycle ' 48% * Chemical and Pharma companies playin
Slide 31: Pfaudler Technologies (1/2)
Pfaudler Technologies (1/2) alloy technologies Selected alloy technologies ; ' | REACTORS MIXING | PRESSURE AGITATED | DIN standard, TECHNOLOGY | VESSELS REACTORS ! ' pharma, Drives, sealing ' Solid / liquid Mixing ; | laboratory units | separation, reactors components i iF iF ! I I , ! PROBES, OTHE
Slide 32: Pfaudler Technologies (2/2)
Pfaudler Technologies (2/2) Core Pfaudler brand compl EDLON So FLUOROPOLYMERS ENGINEERED ROLL COATINGS ROTOMOULDING COVERS Fluoropolymers for corrosion resistance, high purity, low friction and non-sticking NORMAG LAB & PROCESS GLASS Lab and process systems in borosilicate glass LABORATORY & PROCESS
Slide 33: Pfaudler Systems
Pfaudler Systems Delivering a complete integrated system including process, equipment, insulation, instruments and controls Selected systems capabilities Key systems highlights * Average order size: $lm+ * Big Orders: Above $5m up to $10m-$20m Order Size Glass Lined or Safe handling of hot, concentr
Slide 34: Pfaudler Services
Pfaudler Services Pfaudler Group comprises a comprehensive service offering with systematic lifecycle orientation SERVICE OFFERING f i Mainten: 1 |” Order size up to - 5 ' $100k v Order size Y Order size | ¥ Lead time from from $5k- from $1-100k 1 the shelf up to $0.5m_ ($k on ' 6+ months ¥ Lead tim
Slide 35: Pfaudler International Statement of Profit and Loss
Pfaudler International Statement of Profit and Loss Particulars 9 months as August financial year) on May 2020 Revenue 174 176 127 YoY Growth (%) 12% NA Adj. EBITDA* 9 8 11 EBITDA Margin (%) 5.2% 47% 86% Net Income (S) (4) S Net Margin (9%) (2.6)% (2.4)% 4.0% Pro Forma Net Income (8) (8) 3 Pro Forma
Slide 36: Pfaudler International Statement of Balance Sheet
Pfaudler International Statement of Balance Sheet 36 Particula August financial year! As at May 31, 2020 Fixed Assets (including intangibles) 105 Other Non-current Assets 40 Cash And Cash Equivalents 32 Other Current Assets 90 Total Assets 268 Total Shareholder’s Funds S7 Debt SS Provision (includes
Slide 37: Appendix B: Additional Information on Transaction
Appendix B: Additional Information on Transaction GMM Pfaudler™ ng the standard
Slide 38: Current Structure
Current Structure dler Inte onal S.a.r. Luxe Pfaudler UK Ltd. (UK) ¥ v v v v v 7 inf Pfaudler Services Pfaudler Private Pfaudler SA. de Souzhou- Pfaudler Proudler GmbH Praudler Se Pasa ei) Benelux BY, Limited Cv. Glass Lined Equip. y! ” (Netherlands) (Singapore) (Mexico) Company Limited (China) Pfau
Slide 39: Resultant Structure
Resultant Structure Pfaudler Internation (Luxemb GMM Pf (india 54% aveg es, |. -| (directly / indirectly) 26% Pfaudler Pfoudler Souzhou-Pfaudler kewl? Pfaudler srl Pireuclep Services Private Pfoudler Ltda Pfoudler SA.de | | Glass Lined Equip. (Raw isl US GmbH Limited | CN. ; Ine (Germany) (Italy) (U
Slide 40: Appendix C: Pro Forma Financials
Appendix C: Pro Forma Financials GMM Pfaudler™ Defin’ng the standard
Slide 41: Pro Forma Condensed Combined Statement of Profit and Loss
Pro Forma Condensed Combined Statement of Profit and Loss (Unaudited) 41 Particulars 9 months as August financial year ®) on May 2020 Revenue 15,375 17,492 13,161 YoY Growth (%) 13.8% NA Adj. EBITDA?) 1,313 1,480 1,569 EBITDA Margin (%) 85% 85% 119% Net Income (94) (70) 643 Net Margin (%) (06%) (04%
Slide 42: Pro Forma Condensed Combined Statement of Balance Sheet
Pro Forma Condensed Combined Statement of Balance Sheet (Unaudited) 42 Particula Fixed Assets (including intangibles and right to use assets) 9443 Other Non-current Assets 1165 Cash And Cash Equivalents 3,715 Other Current Assets 9,275 Total Assets 23,598 Equity attributable to owners of the Company
Slide 43: Thank You
Thank You GMMPfaudler™
GMM Pfaudler — Merger or Acquisition (September 2020) on 6ix