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  • 1. 1 1 DeA Capital XXXXXXXXXXX [TITOLO] May 2012 DeA Capital overview
  • 2. DeA Capital  Company overview  DeA Capital Investments portfolio  Alternative Asset management 2
  • 3. DeA Capital at a glance  DeA Capital is De Agostini Group’s vehicle for alternative investments.  Diversified private equity, permanent capital investor with two lines of business:  Private Equity investments  Direct: - Exposure to defensive sectors - International footprint (Western and emerging Europe)  Indirect - Private equity Funds and funds of funds Alternative asset management business: ~10 bln € under mgmt*g g  Real estate funds (9.5 bln €):  Private equity (1.2 bln € AuM)  Strong and recurrent cash flow generation  Net asset value at 31 March 2012: 701 mln €; 2.51 € per share 3* As of March 2012
  • 4. A balanced business model: investments and asset management Alternative asset management Private equity 1. Direct investments Mgmt of Private equity funds, FoFs, Real estate funds, RE services  co-control or coinvestment  medium term horizon  controlling stakes  core business Private healthcare € 2 b Food retail € 2 4 b l € 9.5 bn AuM € 1.2 bn AuM ~€ 2 bn revenues € 2.4 bn sales Consumer credit - 23 RE funds - 2 PE funds of funds - 2 thematic funds € 71 mln mgmt fees in 2011 Managed by the Group’s asset management companies 2. Fund Investments 4
  • 5. DeA Capital strategy • Migros: targeting an exit in the short term, depending on market conditions Exit from P i t E it • GDS: exit unlikely in the short term. Options available for deleverage through increased FCF generation/disposals and visible value enhancement before exit Private Equity Investments • Full visibility of results in DeA Capital’s P&L from 2012y p • Stable cash flows • Further external growth/consolidation • Gradual elimination of discount to NAV Focus on Alt. Asset Mgmt • Dividend distribution to be considered when an exit is Di id d completed • Going forward, profits from AAM will provide a further source for distributions Dividend policy 5
  • 6. Free float 24 1%  Independent Board members: 3 out of 9 DeA Capital: shareholder structure and corporate governance DEB Holding* 3 8% 24.1% Independent Board members: 3 out of 9  Remuneration Committee (2/3 independent)  Audit Committee (2/3 independent)  Investments for 100+ mln need to be approved by the De Agostini Treasury stock Mediobanca 4.8% 3.8% pp y BoD. All investments are preliminarly reviewed by an internal committee.  Voting system: slate system. Slates can be presented by shareholders that own at least 2.5% of the share De Agostini SpA 58.3% stock 9.0% capital and entitle the 2nd largest slate to appoint one Board member  Star segment listing: commitment to open and constant communication, stock liquidity Only ordinary shares Top Management:  Lorenzo Pellicioli – Chairman: CEO of De Agostini, Chairman of Lottomatica, member of the Executive Committee of Generali  Paolo Ceretti – CEO: General Manager of De Agostini, Board Member of DeA Editore, Lottomatica, GdS, Zodiak. E i d d lifi d i B d bExperienced and qualified non-executive Board members:  Lino Benassi: Member of the Executive Committee of De Agostini SpA, former CEO of Intesa/BCI and INA  Rosario Bifulco: Founder/vice Chairman of Humanitas (hospital), Chairman of Sorin (pharma)  Claudio Costamagna: former head of EMEA Investment banking of Goldman Sachs, previously at Citigroup and Montedison  Severino Salvemini: professor at Università L. Bocconi in Milan  Daniel Buaron: Founder of First Atlantic Real Estate, Board member of IDeA Fimit  Marco Drago: Chairman of De Agostini SpA  Roberto Drago, Marco Boroli: Executive Board Members of B&D Holdingg , g * A company belonging to Mr. Daniel Buaron. Data as of 31 March2012 6
  • 7. Included in LPX50 Index • Since December 2008 Dea Capital was included in the LPX50 Index.p • LPX 50 is the most widely used global listed private equity stock index. Its geographical composition is: 35% Europe ex-UK, 32% North America, 15% UK, 7% Asia, 2% South America. • Among the main index components are: Eurazeo, Wendel, Ratos, Partners Group, Onex 3i Apollo Jafco Blackstone GIMV China Merchants Electra SVGOnex, 3i, Apollo, Jafco, Blackstone, GIMV, China Merchants, Electra, SVG, Pantheon, Ares Capital, Gladstone Capital. • LPX GmbH is a provider of Private Equity Research and a family of indicesp q y y representing the Listed Private Equity (LPE) universe. Due to the liquidity of the underlying constituents LPX indices are the foremost investable, tradable and transparent benchmarks for the Private Equity asset class. Based on profound d h d h k G b dacademic research and a comprehensive network in practice, LPX GmbH provides services in the following areas: Benchmarking, Asset Allocation, Research and Financial Products. www.lpx.ch 7
  • 8. De Agostini De Agostini is a family-owned financial conglomerate active in 66 countries worldwide with 2011 revenues of over € 5 bln. The Group is focused on 4 key sectors Drago familiesBoroli families Publishing Media&Communication Gaming and services Finance ~2.4% stake in Generali Publishing Media&Communication Gaming and services Finance Lottomatica (59.7%) GTECH (100%) DeA Capital (58.3%) IDeA Capital Funds SGR Zodiak Media Group (71.3%) Direct Marketing Partworks p (100%) Libri IDeA Fimit SGR (61.3%) Antena 3 (22.3%) 8
  • 9. De Agostini financial investment track record 10-year track record in PE investment (Seat, Toro, Eutelsat, funds). Alternative investments, PE in particular, traditionally contributed to the optimal allocation of the Group’s resources, enhancing shareholder returns and created a valuable network of relationships with major sector players. Seat (yellow pages, info services) 1997-99 ~€ 285 mln 2000 235% Main direct investments Exit IRRInvestmentYear (y p g ) 235% Matrix (web portal, services) 1999-03 ~€ 50 mln 2004 104% E telsat 2003 € 200 l 2004 31%Eutelsat (satellite) 2003 ~€ 200 mln 2004 31% Limoni (retail) 2000 ~€ 30 mln 2006 13% Toro (insurance) 2003 ~€ 800 mln 2006 37% Indirect investments InvestmentPeriod PE funds and F. of Funds 2001-current >€ 400 mln Indirect investments InvestmentPeriod 9
  • 10. A strong network of relationships Links with Private Equity Funds Strategic presence in key sectors High-profile senior management and Board members •High-quality deal flow •No need to rely solelyo eed to e y so e y on competitive bidding De Agostini has traditionally acted as an De Agostini holds controlling or significanttraditionally acted as an investor in global private equity funds and as a coinvestor along with them controlling or significant stakes in companies operating in key sectors in Southern Europe Strong relationship with major commercial and investment banks 10 investment banks
  • 11. DeA Capital  Company overview  DeA Capital Investments portfolio  Alternative Asset management  Key financialsKey financials 11
  • 12. Generale de Santé: leader in French private healthcare The largest French network of private healthcare clinics: Santé Holdings S.r.l. Mr. Antonino Ligresti DeA CapitalMediobanca 47 00 % The largest French network of private healthcare clinics: 61 clinics, 4 radiotherapy centres and 25 psychiatric clinics located in France 20 rehabilitation centres  wide coverage of France with a marked concentration in i i Santé SA 9.99 % 100.00 % Santé Développement Europe SAS (“Bidco”) Market 47.00 % 43.01 % nine regions a capacity of over 14,000 beds and places 5,500 independent doctors specialising in all fields Covering a wide range of hospital care services: Générale de Santé 24.2% ( Bidco ) 59.8% 16.0 %  Healthcare services including acute care (>80% of revenues), oncology/dialysis, psychiatry, rehabilitation. 2011 GDS key figures Revenues € 1 955 l EBITDAR € 398 l Net Financial Pos. 8 l EBITDA € 2 9 l Recurrent EBIT € 2 l Net profit € 2 l *€ 1.955 mln € 398 mln -854 mln€ 249 mln € 125 mln € 25 mln* 12 * Before impairment of goodwill
  • 13. Investment attractions Value drivers Generale de Santé: refocusing the business model  Safe sector: ~100% social security coverage; systematic use of additional healthcare insurance policies (ca. 80% of French pop.) Investment attractions Value drivers  Disposal of non core businesses, restructuring (completed: disposal of clinics in Italy, home care and clinical labs in France)  Healthy growth: ~3/4% growth p.a. in past 5 yrs, due to medical progress, ageing population  Barriers to entry: due to heavy regulations, cost of new hospitals  Regrouping of structures to achieve economies of scale and grow revenues, to be completed in 2012.  Reorganisation of MSO and rehab clinics into 21 poles of new hospitals  Increasing importance of role of private sector (but still only slightly over 20% of hospital care expenditure)  Efficiency improvement in purchases/overheads (mainly for acute care), corporate costs and capex  Real estate ‘sale and rental’: two large deals already completed in 2007 and ‘08. ca. 600 mln € ll h b l h GDS strong market position (it is by far the largest private clinics network in France  Further sector consolidation expected: 80% of structures have less than 100 beds. properties still in the balance sheet  Revenue growth: market share, capacity increases, regroupings drive volume growth and compensate for current tough pricing environment in France Targets  organic revenue growth and EBITDA margin improvement  free cash flow, real estate and non core asset disposals to drive gradual deleveraging 13 p g g g
  • 14. Migros Turk: a leading player in Turkey’s food retail Turkey’s largest supermarket chain:  after disposal of Sok (discount stores), 718 stores in Turkey at the end of December 2011 Presence (27 stores) in other neighbouring countries (Azerbaijan Kazakhstan Macedonia Deal structure:  DeA Capital has a 17% stake in a consortium led by BC Partners  DeA Capital initial equity investment: 175 mn €  In April 2011 the consortium reduced its stakecountries (Azerbaijan, Kazakhstan, Macedonia, Kyrgyzistan)  Total selling area: ca 800k sqm Market: O i d t il k t t d t In April 2011 the consortium reduced its stake in Migros from 97.9% to 80.5% by selling to institutional investors  Discount stores sold for 600 mln YTL  Dividends cashed in by DeA to date: 71 mn € Leverage: Debt/EBITDA ca 4x Organized retail market expected to grow strongly in the next few years  Share of organized retail on total grocery sales ca. 45% vs >80% in the main Western European countries  Leverage: Debt/EBITDA ca. 4x Strategy:  Maintain and strengthen leading position among supermarket chains, accelerating network expansion (100/year) Turkish economy still has a significant growth potential, in spite of current global crisis 2011 Migros financials (TRY IFRS) expansion (100/year) Implement cost cutting initiatives and improve supply chain 2011 Migros financials (TRY, IFRS) Sales 5.753 YTL bln +10% EBIT 232 mln Net Fin. Position -1.6 bn EBITDA 386 mln # Stores 745 14
  • 15. The value of two unique assets Generale de Santé Migros Market position Largest private healthcare operator in France (17% share) Largest supermarket chain in Turkeyoperator in France (17% share) Turkey Market structure Dominated by public hospitals (ca 70-75%), private still fragmented. Regulated sector: very high b i t t 55% of sales still made via traditional retail; few international operators with a significant presence (C f T )barriers to entry (Carrefour, Tesco) Main competitors Largest competitor’s size is less than half GdS (Vitalia) Carrefour (hypermarkets), Tesco (supermarkets), BIM (discount) Main attractions of the asset Only private healthcare operator in France managed as a single-brand group; main entry point for large investors, sector players. Non- Largest supermarket chain in a fast growing market; main entry point for large investors, sector players. Non- replicable asset: valuationesto s, secto p aye s o replicable asset: valuation premium justifiable on an industrial basis ep cab e asset a uat o premium justifiable on an industrial basis D A C it l Major shareholder in Santè SA Co investor (17%) in KenanDeA Capital position Major shareholder in Santè SA with 43% stake (Santè owns ~84% of GdS), with equal rights to main shareholder (47%) Co-investor (17%) in Kenan (which owns 80.5% stake). Corporate governance, tag-along, drag-along rights. 15
  • 16. FundFund investmentsinvestments:: OpportunityOpportunity FundFund 11 –– focus onfocus on ItalianItalian midcapsmidcaps  Élite partnerships: IDeA Opportunity Fund I makes minority private equity co-investments alongside top-tier professional investors  Type of deal: mainly medium sized LBOs including expansion capital, change of control, refinancings follow-on investments corporate re-organizations and build-ups No early stage norefinancings, follow-on investments, corporate re-organizations and build-ups. No early stage, no real estate  Existing investments: 5% stake in Giochi Preziosi (Sector: Toys; other investors: Clessidra, Intesa Sanpaolo); 4% stake in Manutencoop Facility Management (other investors: PEP, MPS Venture, Unipol); 9.2% stake in Grandi Navi Veloci (Sea transport; other investors: Investitori, p ); ( p ; Associati IV, Charme); Euticals (pharma sector – conv. Bond; others: PEP); 9,1% stake in Telit (M2M wireless technologies; others: institutional investors, management).  Authorized by Banca d’Italia on 3rd January 2008. July ‘09: 3rd and final closing at € 217 mln (52% called so far). Management team: IDeA Capital Funds. DeA Capital investment: 36,2 mln € (book value). 16
  • 17. Fund investments: IDeA 1Fund investments: IDeA 1 –– Italy’s largest PE fund of fundsItaly’s largest PE fund of funds  Final closing of €681 million atLP Breakdown after final closing Current Asset Allocation by Type Insurance co 21% Family office 13% April 2008  Part of Italy’s largest FoF program, that also includes theSmall buyout 14% Asset-based PE 6% Expansion 9% Venture Cap. 5% B k /FiFoundations HNWI 22% p g , ICF 2 fund, worth 281 mln €  Commitments in 42 funds worth over €650 mln Exposure to >429Large buyout 14% Special situations 18% Banks/Fin. Instit. 33% Foundations 12% over €650 mln. Exposure to >429 companies and 30 distressed debt positions. ~40% acquired on the secondary mkt Access to top-performing private equity funds Large buyout 15%Mid buyout 32% y Vintage diversification: from 2000 to 2011 European Private Equity US Private Equity Investments = 76% of fund size. Ca. € 215 mln distributions received since launch, and 104 mln distributions made to LPsRest of the World Private Equity/VC distributions made to LPs Net IRR since inception: 2.6%. 1st quartile in Europe (FoFs) Rest of the World Private Equity/VC DeA Capital investment: 94 3 mln € (book value) 17 DeA Capital investment: 94,3 mln € (book value)
  • 18.  ICF 2 is a global fund of private equity funds, managed by IDeA Capital Funds. The Fund targets both the Fund investments: ICF II – the second PE fund of funds g p q y , g y p g primary and the secondary market. Target geo breakdown Target Asset Allocation Credit, Special situations, Expansion, VC 50% US 33% RoW 33% Mid-small buyout 50% Europe 33% E i ti it t t 65% f f d i it l ll t d 16% Existing commitments at ca. 65% of fund size, capital calls at around 16%.  Funds include Levine Leichtmann Capital Partners IV (US); 21 Centrale Partners IV (France), Apollo Overseas Partners VII, Affinity Asia Pacific III, Oaktree Principal V, Citic Capital China Partners II, Nazca II&IIIII&III.  Net IRR since inception: 8.3%  Authorized by Banca d’Italia on 24th February 2009. April ‘09: 1st closing at € 150 mln; Sept. ‘10: final 18 closing at € 281 mln.
  • 19. DeA Capital  Company overview  DeA Capital Investments portfolio  Alternative Asset management  Key financialsKey financials 19
  • 20. Why Alternative Asset Management •Still high savings rate; number of HNWI increasing/stable •AAM industry highly fragmented and inefficient •Lack of multi-asset platforms L i tit ti l i t l k t t d h t Italian Market f •Large institutional investors lack a structured approach to alternative investments features •Financial crisis shifted investor focus on independence, absolute return objectives, risk management •Regulations drive separation of asset managers from banks •Private pension system increasingly important and able to Market Di ti it Private pension system increasingly important and able to diversify portfolio through alternative investments •Properties held by PA, banks and institutional investors in need of professional management Discontinuity Private equity in Italy Real estate in Italy • 29 bln € AuM with >150 operators • Largest asset managers have 2-5 bln AuM • Banks/Insurers underinvested • 45 bln € AuM with 305 funds, expected at 100 mln by 2015* • Gap vs EU countries: 96 bln AuM in Germany. No REITs 20 * Scenari immobiliari 2011
  • 21. Private equity fund management ID A C it l F d SGR f d d i 2006 d h b It l ’ l d i th t f i t IDeA Capital Funds SGR was founded in 2006 and has become Italy’s leader in the management of private equity funds of funds. It also manages two “thematic” funds and it plans to further expand this product line.  With over €1.2 bn under management as of 31 December 2011, it is one of the largest alternative investment groups in Italyinvestment groups in Italy. FUNDS MANAGED:  IDeA 1 Fund of funds: Italy’s largest PE fund of funds. 681 mln €  ICF 2: the second FoF of IDeA’s program . 281 mln €  IDeA Opportunity Fund 1: mid-sized LOBO coinvestment fund. 217 mln €  IDeA Efficienza Energetica e Sviluppo Sostenibile: the new thematic fund focused IDeA Efficienza Energetica e Sviluppo Sostenibile: the new thematic fund focused on services and technologies for energy saving and renewable energy  DeA Capital acts both as an investor in products managed by IDeA Capital Funds and as a 100% shareholder in the mgmt company, thus being exposed to the asset management business returns 21
  • 22. Real Estate fund management: IDeA Fimit in a nutshell 9.5 bln € AuM # 1 in Italy 23 funds 21% mkt share 2011 fees 59 mln € • Deal creates largest Italian player, with a high quality fund portfolio, focused on large Italian AuM Italy fundsshare 59 mln € g p y , g q y p , g cities and offices/bank branches (over 75% of total) • Leverage on strategic role of IDeA FIMIT’s other institutional shareholders for developing new initiatives in the Italian market: new funds focused acquisitionsnew initiatives in the Italian market: new funds, focused acquisitions • Critical mass enabling IDeA FIMIT to gradually expand to other markets (Europe, US), by both offering “Italian products” and diversifying its portfolio’s geography. 22
  • 23. IDeA FIMIT: a solid shareholder base, a strong investor base INPS Enasarco IdeA FIMIT Institutional Investor baseIdeA FIMIT SGR Shareholder structure P iF d iINPS 29.7% 6.0% Inarcassa 3.0% Other 0.1% Pension  funds (Enti) 66% Sovereign  funds Foundations 3% HNWIs 3% 2% DeA Capital 61.3% Banks 13% Corporates 7% Insurance Cos 6% 23 …..+ over 70,000 retail investors
  • 24. A strong market position and a positive track record ITALY RE ASSET MANAGERS (AuM € bln)ITALY RE ASSET MANAGERS (AuM € bln) 9.5AuM NAV 6 4 AuM 4.6 NAV NAV 6.4 2.1 2 Capitalising on domestic strengths to become a l bAuM AuM 4.5 4 5 NAV 2.7 3 4 European player, by: 1) Offering italian funds to foreign investors willing to «comeAuM AuM 4.5 4.0 NAV NAV 3.2 2 3 4 5 willing to «come back» to our country 2) Gradually creating a presence abroad to NAV 2.3 IRR to 31 December 2011 find investment opportunities in foreign real estate for Italian investors 10.34% 10.36% 18.56% 18.97% 11.18% 8.46% 13.62% 24
  • 25. A high quality asset portfolio F d th t ti i l ti 60% f t i R d Mil• Focused on the most prestigious locations – 60% of assets in Rome and Milan • Focused on offices, negligible exposure to residential • Over 80% of space is rented 33,6 Asset breakdown by destination 331,0 14,2 3.454,6 82,0 344,6 266,3 Offices 57.9% Other 8 3%27,6 248,8 271,8 75,3 44,5 Healthcare 0.5% 8.3% 3.005,7 0,2 156,1 0,6 14,7 Bank  branchesRetailIndustrial Hotels 5 1% Residential 2.5% 58,6 249,0 12.9% Retail 8.0% Industrial 4.7% 5.1% 25 43,9
  • 26. Disclaimer This presentation contains statements that constitute forward-looking statements regarding the intent, belief or current expectations of the DeA Capital (“the Company”) with respect to the financial results and other aspects of the Company's activities and strategies. Such forward looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those in the forward looking statements as a result of various factors.factors. Analysts and investors are cautioned not to place undue reliance on those forward looking statements, which speak only as of the date of this presentation. DeA Capital Spa undertakes no obligation to release publicly the results of any revisions to these forward looking statements which may be made to reflect events and i t ft th d t f thi t ti i l di ith t li it ti h i th C ’circumstances after the date of this presentation, including, without limitation, changes in the Company’s business or investment strategy or to reflect the occurrence of unanticipated events. Analysts and investors are encouraged to consult the Company's Annual Report as well as periodic filings, press releases and all documentation made publicly available on the website www.deacapital.it. The Manager responsible for the preparation of company accounting statements Manolo Santilli declares inThe Manager responsible for the preparation of company accounting statements, Manolo Santilli, declares in accordance with paragraph 2 of article 154 of the Consolidated Finance Act that the accounting information on DeA Capital included in this document corresponds to registered company accounts, books and records. 26