Sartorius AG · XETR:SRT
Sartorius — Merger or Acquisition (February 2007)
30 slides from Sartorius's merger presentation, February 2007
Slide 1: Two industry leaders – One solution provider
Two industry leaders – One solution provider Platzhalter Bild Combination of Sartorius’s Biotechnology division and Stedim Biosystems creates a leading global provider of disposable technologies for the biopharmaceutical industry 1
Slide 2: Agenda
Agenda • Highlights • The Companies in Brief Platzhalter Bild • Strategic Rationale • Shareholder Benefits • Transaction Details • Company Organization 2
Slide 3: Highlights of the transaction
Highlights of the transaction Sartorius has signed a binding share purchase agreement with the founders of Stedim Biosystems. Sartorius will make a public tender offer to outstanding shareholders of Stedim Biosystems. Sartorius will contribute its Biotechnology division into Stedim Biosystems. Throu
Slide 4: Strategic highlights
Strategic highlights With complementary product portfolios, R&D platforms, and regional strengths, the two businesses are a perfect match. The merger leads to significant revenue synergies, because filters and bags are used in combination in typical biopharmaceutical applications. The combined compa
Slide 5: Agenda
Agenda • Highlights • The Companies in Brief Platzhalter Bild • Strategic Rationale • Shareholder Benefits • Transaction Details • Company Organization 5
Slide 6: Sartorius in brief
Sartorius in brief Supplier and technology provider for the biopharmaceutical industry, food and beverage industry, research and educational institutes of the public sector Worldwide presence with production and sales facilities in Europe, America, and Asia 3,800 employees Two divisions Biot
Slide 7: Sartorius 2006 financials
Sartorius 2006 financials Regional split Group 4% Sales €521.1 mn EBIT margin 10.0% 19 % Biotechnology 58% Sales €271.0 mn 19 % EBIT margin 11.7% Mechatronics Sales €250.0 mn EBIT margin 8.1% Europa Asia | Pacific North America Other Markets 7
Slide 8: Stedim Biosystems in brief
Stedim Biosystems in brief Pioneer of disposable bags for biopharmaceutical applications and a global market leader in this fast growing market. - Most complete product portfolio of bags, quality leader in that market - Freeze-and-thaw technology with single-use and multi-use solutions - Aseptic t
Slide 9: Stedim Biosystems 2006 financials
Stedim Biosystems 2006 financials Regional split Group Sales €91.4 mn EBIT margin 13.0% (market consensus) 44 % 56 % Europe North America 9
Slide 10: Agenda
Agenda • Highlights • The Companies in Brief Platzhalter Bild • Strategic Rationale • Shareholder Benefits • Transaction Details • Company Organization 10
Slide 11: Disposable systems replace stainless steel equipment in biopharmaceutical production processes
Disposable systems replace stainless steel equipment in biopharmaceutical production processes 11
Slide 12: Combination of filter and bag business supports growth prospects of combined company
Combination of filter and bag business supports growth prospects of combined company Almost each bag is sold in combination with a filter, as a filter is always used when a bag gets filled with liquids. Of course, filters are also used in other applications. While both the filter and the bag markets
Slide 13: The market for disposables provides additional growth over the high underlying growth of the biotech industry
The market for disposables provides additional growth over the high underlying growth of the biotech industry Market size CAGR of disposables ~18% CAGR of the biotech industry ~12% CAGR of the classical pharmaceutical industry: 6% - 8% 2006 2011 13
Slide 14: Highly complementary product portfolios of Sartorius and Stedim result in a unique market position
Highly complementary product portfolios of Sartorius and Stedim result in a unique market position Cell culture Membrane Purifi- Freeze Bags / Ferment. filtration cation / thaw Sartorius + + + - - Stedim - - - + + Sartorius Stedim + + + + + Millipore - + + + - Pall + + + - - Fisher + - - + - 14
Slide 15: Regional fit
Regional fit Utilization of the Sartorius sales organization in Asia for Stedim products Enhanced market position in North America as the largest biotech market • Sales • Production and Sales 15
Slide 16: A perfect match in a highly attractive market
A perfect match in a highly attractive market 16
Slide 17: Agenda
Agenda • Highlights • The Companies in Brief Platzhalter Bild • Strategic Rationale • Shareholder Benefits • Transaction Details • Company Organization 17
Slide 18: Substantial benefits for the shareholders of Stedim Biosystems
Substantial benefits for the shareholders of Stedim Biosystems Participation in the significant upside potential from revenue synergies: Combination creates a leading global provider of disposable technologies for the biopharmaceutical industry Largest and most integrated portfolio of disposable
Slide 19: Sartorius Stedim Biotech – indicative 5-year performance
Sartorius Stedim Biotech – indicative 5-year performance Pro forma sales 2007: € 400 – 420 mn Pro forma operational EBITA margin 2007: ~ 14 % Transaction and integration costs 2007: € 5 - 10 mn CAGR 2007 – 2011: 14 - 15 % Further increase of EBITA margin expected 19
Slide 20: Substantial benefits for the shareholders of Sartorius
Substantial benefits for the shareholders of Sartorius Significant strengthening of Sartorius Biotechnology division Hidden value within the Sartorius share is unlocked Additional growth and earnings potential at a fair price Transaction structure limits financing requirements for the Sartor
Slide 21: Sartorius – indicative 5-year performance
Sartorius – indicative 5-year performance • Pro forma sales 2007: € 660 – 680 mn • Pro forma operational EBITA margin 2007: ~ 12 % • Transaction and integration costs 2007: € 5 - 10 mn1 • CAGR 2007 – 2011: 11 – 12 % • Further increase of EBITA margin expected 1 These are the transaction and integrat
Slide 22: Agenda
Agenda • Highlights • The Companies in Brief Platzhalter Bild • Strategic Rationale • Shareholder Benefits • Transaction Details • Company Organization 22
Slide 23: Description of the transaction structure
Description of the transaction structure Sartorius acquires a substantial stake in Stedim Biosystems from its founders, who will retain a significant shareholding. Sartorius will file a tender offer for the entire capital of Stedim Biosystems. After having filed a tender offer, Sartorius contributes
Slide 24: Sartorius invites Stedim shareholders to remain invested
Sartorius invites Stedim shareholders to remain invested Stedim shareholders shall have the options to tender for € 43.00 per share in cash immediately to keep their shares and be granted a warrant to potentially receive a cash payment - After a maturity period of 24 months and if the Sartorius
Slide 25: Indicative transaction timeline
Indicative transaction timeline Acquisition of Stedim shares Launching tender offer (Offer of warrant to those shareholders that do not tender) Antitrust Completion Extraordinary general meeting filings of carve-out - Execution of contribution Feb-07 Mar-07 Apr-07 May-07 Jun-07 Closing of tender off
Slide 26: Agenda
Agenda • Highlights • The Companies in Brief Platzhalter Bild • Strategic Rationale • Shareholder Benefits • Transaction Details • Company Organization 26
Slide 27: Preliminary structure of the Sartorius group after the transaction
Preliminary structure of the Sartorius group after the transaction Sartorius AG free float Stedim founders up to 21% 9% 70-91% 100% Sartorius Stedim Biotech S.A. Mechatronics 27
Slide 28: Integration | future organization
Integration | future organization Establishment of a fully combined global functional organization Integrated sales force Joint key account management and branding Combined R&D activities Harmonization of administration and marketing processes Utilization of the Sartorius sales organization
Slide 29: Corporate governance
Corporate governance The board of Sartorius Stedim Biotech S.A. will have 7 members: • Dr. Joachim Kreuzburg, CEO • Liliane de Lassus, HR and Administration • Reinhard Vogt, Sales and Marketing • Volker Niebel, Operations • Bernard Lemaître • Prof. Arnold Picot • Henri Riey (preliminary) 29
Slide 30: Disclaimer
Disclaimer This presentation contains statements concerning the Sartorius group’s future performance. These statements are based on assumptions and estimates. Although we are convinced that these forward-looking statements are realistic, we cannot guarantee that they will actually materialize. This