acquisition of bopp & reuther gmbh - imi plc

Acquisition of Bopp & Reuther GmbH

An excellent strategic fit

Significantly enhances IMI’s presence in the growing power sector

Extends the Critical Engineering division’s existing product range to include

complementary semi-severe products increasing the addressable market

Increases exposure to emerging markets in particular China and India where the power

markets are forecast to grow 5% to 7%

Provides access to new aftermarket opportunities via Bopp & Reuther’s existing installed

base

Creates further opportunities to increase effectiveness through implementation

of lean and operational improvements

Generates synergies of c.€9m by end of 2017

Be earnings accretive in 2015 and returns expected to exceed

WACC by the end of 2017

IMI plc - Acquisition of Bopp & Reuther

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‣ A global supplier of control valves and safety valves to the

power generation and process industries

‣ Based in Mannheim, Germany with a network of offices in India, China, Korea and Russia

‣ 57% sales in power, 25% process and 18% service related

‣ Blue-chip customer base – top 10 customers represent circa. 38% of sales

Bopp & Reuther overview


27%

22%31%

7%

7% 6%

Germany

Rest of Europe

Asia

Middle East

CIS

RoW

18%

82%

Aftermarket

NewConstruction

43%

55%

2%Control valves

Safety valves

Shut-off valves

25%

45%

12%

18%

Process

Fossil Power

Nuclear

Service support

Sales by

Product / Service

Bopp & Reuther overview

Sales by

End Market

Sales by

Geography


Sales by

Sector

‣ Range of turbine bypass and safety valves used mainly in the

fast-growing markets of India, China & Russia

‣ Protection of gas turbine during start up or fault conditions

‣ Used for Coal fired, combined cycle power generation and

desalination plants

Steam spring loaded

safety valveTurbine Bypass

Complementary product portfolio –Power sector

Nuclear Safety Valves


‣ Protection for pressure vessels, pipelines, boilers, compressors

‣ Commissioning & Recertification – turbine bypass and

safety valves

‣ Speciality safety products – oxygen, marine applications

‣ Repair & refurbishment – focus on Bopp & Reuther installed base

A wider product offering –Process & service sectors

Controlled Safety

valves

Safety valve

recertificationHigh pressure

gate valves


Enhanced capabilities

to improve performance

Expanded product range

to drive revenues

GLOBAL PRESENCE

WORLD CLASS CAPABILITY

Lean processes

Global sourcing

Service footprint

Americas

FSU

Middle East

Australia

Africa

Asia

World class capability:Leading product to growing market

▸Power

▸ Turbine bypass for Asia

▸ Safety valves

▸Process

▸ Safety relief valves

▸Associated control products

▸ Desalination

▸Asia focus & growth (5%+)

▸Leading names in industry

▸Speed of response

GROWING MARKET

LEADING PRODUCT


Increased exposure to high growth markets & segments

Provides access to additional aftermarket opportunities

35%

50%

PARTS & SERVICE

OIL & GAS, POWER

AND PETROCHEMICAL

HIGH GROWTH

MARKETS

40%

PRO FORMA REVENUE

BY SECTOR

PRO FORMA REVENUE

BY GEOGRAPHY


Based on 2013 actuals

Transaction details

‣ Purchase consideration €152.6m payable at completion

‣ cash / debt free, after expenses

‣ Funded from existing bank facilities

‣ Transaction subject to merger clearance approval, expected to

complete around end of the year

‣ 100 day Integration plan developed and ready for execution


An excellent strategic fit

Enhances focus and provides a strong platform for accelerated growth

Broadens IMI’s product portfolio in power and process industries

Increases exposures to attractive emerging markets and aftermarket opportunities

Earnings accretive in 2015 and a return on invested capital expected to exceed WACC by the end of 2017

Generates synergies of approximately €9m by end of 2017


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Acquisition of Bopp & Reuther GmbH

Appendices


Bopp & Reuther financials

Year End Year End Year End

€m Dec ‘11 Dec ‘12 Dec ‘13

Revenue 75.5 84.8 89.8

EBITDA 10.9 13.5 11.2

EBIT 9.9 12.5 10.0

Operating margin (%) 13.1 14.7 11.1

Effective cash flow (%) 30 30 30

Operating cash flow 5.7 7.2 18.9

Working Capital 15.5 19.3 18.9

Net Assets 22.0 27.4 28.2

Source: Accountants Report


Thank you

acquisition of bopp & reuther gmbh - imi plc

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