Odesa Region: investment opportunitiesJanuary 2016

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Contents

I. Investment opportunities ……..………………………….....

II. SP Advisors at a glance.…………………….………….....

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16

I. Investment opportunities

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Ukrkava | Coffee processing | Illichivsk

Project status: initial phaseFunding required: $3-27 mlnAllocation planned:• working capital replenishment ($3-9 mln)

• construction of sublimated coffee todifferentiate the product range ($16-18 mln)

Company snapshot:• Commissioned in 2011

• Ukraine’s only plant designed and built as acoffee factory for production of instant coffee

• Strategically located

• ISO certificated

• Broad coffee product range (25+ items)

• Own brand Lacomba.

• Planned capacity at 10,800t monthly

• Currently working at 10% capacity utilization.

Investment parameters (80% capacity load)

Source: Company

Odesa

Kyiv

Illichivsk

Total investment required $3-27 mln

- Debt 100%

- Equity 0%

Projected Sales $46 mln

Projected EBITDA $10 mln

5

Asol | Cement production| Odesa

Investment parameters

Source: Company

Total investment required EUR 45 mln

- Debt 100%

- Equity 0%

Estimated payback period 7 years

Estimated IRR 18%

Estimated NPV (@ 10% discount rate)

EUR 25 mln

Projected Net Sales EUR 91 mln

Odesa

Kyiv

Odesa

Project status: initial phaseFunding required: EUR 45 mln (8-year debt)Allocation planned:• construction of cement factory

Project snapshot:• Right near deposits of raw materials.

• Direct access to rail road.

• Export oriented.

• High-grade cement production (laboratoryanalysis conducted by LORIS BERLIN).

• Projected production capacity at 300kt p.a.

• Energy sufficient and low ecological impact.

6

Sonant | Polystyrene insulation products| Avangard

Investment parameters

Source: Company

Total investment required EUR 6.5 mln

- Debt 100%

- Equity 0%

Estimated payback period 4 years

Estimated IRR 30%

Estimated NPV (@ 10% discount rate)

EUR 3.9 mln

Projected Net Sales EUR 19 mln

Odesa

Kyiv

Avangard

Project status: pre-construction phaseFunding required: EUR 6.5 mln (5-year debt)Allocation planned:• construction of polystyrene insulation plates

factory

Project snapshot:• Founded in 1994.

• Ukraine’s second largest producer.

• 4 separate plants in other regions; working atfull capacity.

• The company aimed to increase its marketshare to 20% by squeezing out smallerplayers.

• Planned capacity at 80k m3 per month.

• Landplot and infrastructure for the planthave been developed.

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Mayachnyi | Private clinic| Odesa

Odesa

Kyiv

Odesa

Investment parameters

Source: Company

Total investment required EUR 16.5 mln

- Debt (67%) EUR 11.0 mln

- Equity (33%) EUR 5.5 mln

Estimated payback period 6.5 years

Estimated IRR 19%

Estimated NPV EUR 6.1 mln

Projected Net Sales EUR 21.5 mln

Project status: initial phaseFunding required: EUR 16.5 mlnAllocation planned:• Building reconstruction and launch of new

private clinic in recreation area of Odesa city

Project snapshot:• 1km from the beach.

• 3-storey building of 3,200 sqm.

• Employment of over 100 people.

• Negotiations on reconstruction of thebuilding – in the process.

• Consultations, treatment, diagnostics,obstetrics, surgery and hospital stay services.

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IAIC Group | Greenhouse agriculture| Odesa

Investment parameters

Source: Company

Total investment required EUR 10 mln

- Debt 100%

- Equity 0%

Estimated payback period 4.5 years

Estimated IRR 29%

Odesa

Kyiv

Odesa

Project status: initial phaseFunding required: EUR 10 mln (5-year debt)Allocation planned:• Construction of greenhouse complex

Project snapshot:• The group plans to produce vegetables,

salads and herbs.

• Substitution of imported agriculturalproducts.

• The group combines 4 agricultural entities inUkraine

9

Grain processing plant | Agriculture| Izmail

Investment parameters

Source: Company

Total investment required $173 mln

- Debt 100%

- Equity 0%

Estimated payback period 4.2 years

Odesa

Kyiv

Izmail

Project status: initial phaseFunding required: $173 mlnAllocation planned:• Reconstruction of concrete products plant

for deep processing of grain

Project snapshot:• Production of deep processing of grain

products, including bioethanol (60%).

• Existing production facilities of total area of12,000 sqm.

• Infrastructure and communications – on theplace.

• Planned capacity of 360kt p.a.

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Oniks-K | Vegetable warehousing| Izmail

Investment parameters

Source: Company

Total investment required $10 mln

- Debt (90%) $9 mln

- Equity (10%) $1 mln

Estimated payback period 4.5 years

Project status: initial phaseFunding required: $10 mlnAllocation planned:• Reconstruction of building and launch of a

vegetable warehouse

Project snapshot:• Processing, storage and packaging of

vegetables and root crops (potatoes, tablebeets, carrots, cabbage, onions).

• Projected production capacity of 2,500kt.

• Distribution to wholesalers and supermarketchains in Ukraine.

• Own building of total area of 475 sqm.

• Infrastructure and communications – on theplace.

Odesa

Kyiv

Izmail

11

Kirichevskyi | Fuel pellets production| Nagirne village

Investment parameters

Source: Company

Total investment required $375,000

- Debt (70%) $265,000

- Equity (30%) $110,000

Estimated payback period 3.6 years

Odesa

Kyiv

Nagirne

Project status: initial phaseFunding required: $375,000Allocation planned:• Construction of fuel pellets production plant

Project snapshot:• Production of fuel pellets and briquettes

from wood and straw.

• Production capacity: 6kt in first three years;12kt thereafter.

• Sales distribution: 80% - export, 20% -domestic sales.

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Moldova| Recreation center| Odesa

Odesa

Kyiv

Odesa

Project status: operating businessFunding required: negotiableAllocation planned:• Full exit from the business

Project snapshot:• Located at one of the most prestigious areas

with developed tourism infrastructure.

• 4km from city center, 200m to Arcadia park.

• Total area of 4.7 ha, including 3 ha of parkarea.

• Hotel (84 rooms), recreation center (137rooms), SPA center, indoor swimming poolwith sea water, tennis courts, medical unit,restaurants, parking, etc.

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Illichivsk Commercial Sea Port | Ports| Illichivsk

Project funding breakdown

Operating summary, 2014

Cargo Turnover 10.5Mt

- Grains and vegetable oil 26%

- Ores 24%

- Sulfur 10%

- Other (containers, coal) 40%

Project status: initial phaseFunding required:• negotiable• through public private partnership

(concession, joint ventures, lease, other)

Company snapshot:• One of largest ports in Ukraine.• Facilities to handle over 32Mt of cargo a year.• Vessels with draft of up to 13 meters and

length of up to 300 meters.• Monopolistic position in Ukraine in handling

cargos arrived on Ro-Ro vessels.• Specialization: grain, ore, sulfur, containers

liquid vegetable oil.

Investment areas:• Separate platforms of the sea port.

Odesa

Kyiv

Illichivsk

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UkrLandFarming | Transshipment complex | Odesa

Project funding breakdown

Odesa

Kyiv

Odesa

Total investment* $ 415 mln

- Equity 40%

- Debt 60%

Discounted payback period 12.5 years

Estimated IRR 33%

Estimated NPV $ 122 mln

* including the cost of the land plot

Investment parameters

Project status: initial phaseFunding required: $415 mlnAllocation planned:• construction of a multipurpose

transshipment complex at deep sea port ofYuzhnyi

Project snapshot:• Launch of grain export terminal, oilseeds

complex (crushing plant, oil export terminal),container terminal and feed mill by 2018.

• Own land plot of total area of 133ha.• All licenses and permissions – on the place.• The company produces 4 mln tonnes of own

crops annually and is ready to give a 10-yearguarantee of exporting its produceexclusively through the terminal atpreferential dollar-denominated rates.

• The company’s foreign shareholders (Cargill)and major creditors consider co-investinginto the project.

15

Levada | Frozen foods production | Odesa

Project funding breakdown

Source: Company

Key financials, USD mln

2013 2014 2015ENet Sales 41 31 29 EBITDA 6 3 5Gross margin 47% 41% 44%EBITDA margin 15% 9% 17%

Project status: operating businessFunding required: negotiableAllocation planned:• domestic market consolidation and export

growth• shareholders are ultimately seeking a full exit

from the business

Company snapshot:• #1 frozen foods producer in Ukraine

• 20%+ market share and growing exports.

• 23+ product groups: meat dumplings,pancakes, vareniks, ravioli, etc.

• Strong portfolio of well-known trademarks,good private label contracts.

• Production capacity at 54,000 tonnes p.a.(50% current capacity load).

Odesa

Kyiv

Odesa