PROSPECTUS FOR GENERAL AND VOLUNTARY COMPETING PUBLIC TAKEOVER OFFER FOR THE ACQUISITION OF SHARES REPRESENTATIVE OF THE REGISTERED CAPITAL OF

Transcription

1 FIDELIDADE COMPANHIA DE SEGUROS, S.A. Registered office: Largo do Calhariz, 30, Lisbon Registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number: Registered capital: 381,150, (Offeror) PROSPECTUS FOR GENERAL AND VOLUNTARY COMPETING PUBLIC TAKEOVER OFFER FOR THE ACQUISITION OF SHARES REPRESENTATIVE OF THE REGISTERED CAPITAL OF ESPÍRITO SANTO SAÚDE, S.G.P.S., S.A. Public company Registered office: Rua Carlos Alberto da Mota Pinto, 17, 9th, Edificio Amoreiras Square, Lisbon Registered at the Commercial Registry Office of Lisbon under registration and tax payer number Share capital: 95,542, (Target Company) The following is an unofficial and non-binding English translation of the Portuguese prospectus that was registered with the Portuguese Securities Market Commission (Comissão do Mercado de Valores Mobiliários) on 26 September 2014 (the Portuguese Prospectus ). The original Portuguese Prospectus, written in Portuguese, is the exclusive legally binding version and FIDELIDADE COMPANHIA DE SEGUROS, S.A. assume no liability for any of the statements or representations made in the English translation. In cases of inconsistencies between the Portuguese Prospectus and the English text of the translation, the Portuguese text shall prevail. Financial Intermediary Banco Finantia, S.A. 26 of September 2014

2 ÍNDEX DEFINITIONS... 2 CHAPTER NOTICE/INTRODUCTION Summary of the Competing Offer Registration Effects CHAPTER PERSONS RESPONSIBLE FOR THE INFORMATION CHAPTER DESCRIPTION OF THE OFFER Amount and nature of the transaction Amount, nature and class of securities that are subject of the Competing Offer Consideration offered and its justification Method of payment of the consideration Security or guarantee for consideration Terms of the Competing Offer Assistance Purposes of the acquisition Acceptance Declarations Competing Offer s Results CHAPTER INFORMATION REGARDING THE OFFEROR, HOLDINGS AND SHAREHOLDERS AGREEMENTS Identification of the Offeror Attribution / Aggregation of voting rights Offeror s shareholding in the capital of the Target Company Target Company s voting rights and shareholdings in the Offeror Shareholders agreements Agreements with members of the corporate bodies of the Target Company Representative for market relations CHAPTER OTHER INFORMATION Page 1 of 60

3 DEFINITIONS Unless the context otherwise requires, the terms used in this Prospectus will have the following meanings: CMVM Competing Offer Competing Offer Period Date of the Preliminary Announcement DTT EBIT EBITDA Enterprise Value or EV ESFG ESS or Target Company EUR, Euro or The Portuguese Securities and Exchange Commission ( Comissão do Mercado de Valores Mobiliários ); The general and voluntary public takeover competing offer for the acquisition of all Shares, excluding those that are directly held by the Offeror and by any entities which, being with it in any of the situations set forth in Article 20(1) of the Portuguese Securities Code, block their Shares during the Competing Offer Period; The Competing Offer will start from 8.30 a.m. on 29 of September of 2014 up to 3.30 p.m. on 10 of October of 2014, unless extended under the applicable laws; 23 September 2014 (date of publication); Double Tax Treaty; Earnings before interest and taxes; Earnings before interest, taxes, depreciation and amortization; The enterprise value is calculated through the sum of (i) equity (the value of of the Shares) (ii) minority interests and (iii) net financial debt, less investments in affiliated companies; Espírito Santo Financial Group, S.A., a Luxembourg company, with registered offices at 22/24 boulevard Royal, L-2449 Luxembourg, registered at the Companies Registry of Luxembourg under number 22232, with the registered capital of 207,075,338.00; Espírito Santo Saúde, S.G.P.S., S.A., a public company with registered offices at Rua Carlos Alberto da Mota Pinto, Edifício Amoreiras Square, 17, 9 th floor, Lisbon, registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number and with the registered capital fully paid up of 95,542,254.00; The official currency of the European Union s (EU) Member States that adopted the single currency set out in the Treaty on the Functioning of the European Union; Page 2 of 60

4 Euronext Lisbon by Euronext Lisbon The regulated marked of securities managed by Euronext Lisbon; Euronext Lisbon Euronext Lisbon - Sociedade Gestora de Mercados Regulamentados, S.A., with registered offices at Avenida da Liberdade, 196, Lisbon, registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number , with the registered capital of 8,500,000.00; Fidelidade Subsidiaries Fidelidade or Offeror Banco Finantia or Financial Intermediary Fosun GASS Initial Offer The companies that are controlled by Fidelidade, as set forth in Article 21 of the Portuguese Securities Code; Fidelidade Companhia de Seguros, S.A., with registered offices at Largo do Calhariz, 30, Lisbon, registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number and with the registered capital fully paid up of 381,150,000.00; Banco Finantia, S.A., with registered offices at Rua General Firmino Miguel, nr. 5 1 st floor, Lisbon, with the registered capital fully paid up of 150,000,000.00, registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number ; Fosun International Limited, a listed company at the Hong Kong Stock Exchange, incorporated in Hong Kong, with registered offices at Room 808, ICBC Tower, 3 Garden Road, Central, Hong Kong, registered with the Companies Registry of Hong Kong under number and with an issued share capital of HK$ 17,687,332,114.00; Grupo Ángeles Servicios de Salud, S.A. de CV, a company incorporated and existing under the laws of the United Mexican States, with registered offices at Camino a Santa Teresa 1055, Torre de Especialidades Quirúrgicas, piso 14, Col. Héroes de Padierna, C.P , Ciudad de México, Distrito Federal, United Mexican States; The public general and voluntary takeover offer for the acquisition of shares in ESS by GASS, launched and registered on 19 September 2014, as better described in the launching announcement and prospectus disclosed on the same date and published at CMVM website; Page 3 of 60

5 Interbolsa ISIN JMS Launching Announcement P/E or Price to Earnings Portuguese Securities Code or Cód.VM Interbolsa - Sociedade Gestora de Sistemas de Liquidação e de Sistemas Centralizados de Valores Mobiliários, S.A., with registered offices at Avenida da Boavista, 3433, Porto, registered at the Commercial Registry of Porto under the sole registration and taxpayer number , with the registered capital of 5,500,000.00; The international securities identification number; José de Mello Saúde, S.A., with registered offices at Avenida do Forte no. 3, Edifício Suécia III, 2 nd floor, Oeiras, registered at the Commercial Registry of Cascais under the sole registration and taxpayer number , with the registered capital of 53,000,000.00; The Competing Offer s launching announcement as provided in Article 183-A of the Portuguese Securities Code; The price of shares divided by the net result per share; The Portuguese Securities Code approved by Decree-Law no. 486/99, of 13 November, as amended; Preliminary Announcement The preliminary announcement published by Fidelidade on 23 September 2014 at CMVM s website; Prior Competing Offer The public offer preliminarily announced by JMS on 11 September 2014 should it be timely registered with the CMVM; Prospectus Regulation 3/2004 of Interbolsa Regulation 3/2006 of CMVM Shares Special Regulated Market Session This prospectus for the Competing Offer; Interbolsa Regulation no. 3/2004, as amended, on settlement systems operational rules; CMVM s Regulation no. 3/2006, as amended, on offers and issuers; The 95,542,254 ordinary nominative shares in book entry form representing of ESS share capital, with the nominal value of 1 (one Euro) each; The special stock exchange session to be carried out by Euronext Lisbon, that will take place on the 1 st working day in Portugal after the end of the Competing Offer Period, expected to take place on 13 of October of 2014, at the time to be indicated in the notice to be published by Euronext Lisbon, for the purposes of assessment of the Competing Offer s results. Page 4 of 60

6 0.1. Summary of the Competing Offer The Offeror CHAPTER 0 NOTICE/INTRODUCTION The Offeror is Fidelidade Companhia de Seguros, S.A., with registered offices at Largo do Calhariz, 30, Lisbon, registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number and with the registered capital fully paid up of 381,150, Fidelidade is ultimately controlled by Fosun International Limited, a listed company at Hong Kong Stock Exchange, incorporated in Hong Kong, with registered offices at Room 808, ICBC Tower, 3 Garden Road, Central, Hong Kong, registered with the Companies Registry of Hong Kong under number and with an issued share capital of HK$ 17,687,332,114.00, which owns 80% of Fidelidade s share capital and voting rights. Fosun is, in turn, controlled by Mr. Guo Guangchang. For additional information on the Offeror, please see Chapter 3 of this Prospectus. The Target Company The Target Company is Espírito Santo Saúde, S.G.P.S., S.A., a public company with registered offices at Rua Carlos Alberto da Mota Pinto, Edifício Amoreiras Square, 17, 9 th floor, Lisbon, registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number ESS fully paid up share capital is 95,542, divided into 95,542,254 nominative ordinary book entry Shares, with a nominal value of 1 (one Euro) each. According to the public information available, ESS holds, as at 30 July 2014, 54,385 own Shares, corresponding to 0.057% of its share capital. The Target Company is currently controlled by the company Espírito Santo Healthcare Investments, S.A., a Luxembourg company, which owns 51% of the Target Company s share capital and voting rights, being the remaining 49% dispersed on the regulated market. On the other hand, Espírito Santo Healthcare Investments, S.A. s shareholders are, amongst others (i) Rio Forte Investments, S.A., a Luxembourg company, which owns 55% of the share capital; and (ii) ESFG, which owns 17.74% of the share capital. Rio Forte Investments S.A. is fully owned by Espírito Santo International, S.A., a Luxembourg company. Both Rio Forte Investments S.A. and ESFG applied for the controlled management proceeding (Gestion Contrôlée) before the Luxembourg Court, which applications were accepted by the Court on 29 July 2014, as per the information made available on the same day on the website The Court has designated a delegated judge to make a report to the Court in respect of the financial situation of said companies. Page 5 of 60

7 On 29 July 2014, ESFG informed the market, through a communication published on CMVM s website ( that ESFG has been admitted to controlled management ( Gestion Contrôlée ) stating that the decision follows a Court hearing held on 28 July The Court s decision includes the appointment of a Judge to deal with the process ; and that The decision follows the Company s request to the Luxembourg Courts on 24 July The Company s move to seek Gestion Contrôlée followed its conclusion that it was unable to meet its obligations under its commercial paper programme and obligations associated with the Company s standalone debt obligations and that The Judge is expected to make her report on ESFG s case on 6 October The information contained in this Prospectus regarding ESS comes from and is based on public information, which has not been independently appraised by the Offeror or the Financial Intermediary. The Offeror and the Financial Intermediary are not aware of any events or circumstances indicating that any statement contained herein, with reference to ESS, is not true or is materially misleading. However, the Offeror and the Financial Intermediary do not make any representation concerning the accuracy and completeness of the information contained herein concerning the ESS. In addition the Offeror and the Financial Intermediary do not assume any responsibility for the non-compliance by ESS of its obligation to disclose any events that may have occurred by virtue of which the information contained herein and the information on which the Offeror and the Financial Intermediary have considered, is inaccurate or misleading. Terms of the Competing Offer The Competing Offer is launched in accordance with Articles 185 to 185-B of the Portuguese Securities Code and constitutes a competing offer in relation to the Initial Offer and, if applicable, to the Prior Competing Offer. The Competing Offer is general and voluntary offer for the acquisition of all Shares of the Target Company, excluding those that are directly held by the Offeror and by any entities which, being with it in any of the situations set forth in Article 20(1) of the Portuguese Securities Code, block their Shares during the Competing Offer Period. The Offeror herein undertakes, in accordance with this Prospectus and other documents in connection to the Competing Offer, to acquire all the Shares of the Target Company, save those excluded as referred above, which are object of a valid acceptance. Considering the Shares attributed, directly and under the terms of Article 20(1) of the Portuguese Securities Code, to the Offeror and that are blocked during the Competing Offer Period, the securities covered by the Competing Offer are 95,540,750 Shares. At the date hereof, the Offeror holds, directly and under the terms of Article 20(1) of the Portuguese Securities Code, voting rights corresponding to 1,504 (one thousand and five hundred and four) Shares representing % (zero point zero zero sixteen per cent) of the registered capital of the Target Company. The consideration offered for each Share is 4.82 (four euros and eighty two cents) per Share, deducted of any amount (illiquid) that may be granted to each Share, such as dividends, advance profits of the financial year, or distribution of reserves, such deduction to be made as from the moment on which the right to the concerned amount has been detached from the Shares and if such Page 6 of 60

8 occurs prior to the financial settlement of the Competing Offer. The consideration will be paid in cash and will be available on the 2 nd business day after the Special Stock Exchange Session (single session for the purposes of the offers in competition). The Competing Offer Period will start from 8.30 a.m. on 29 of September of 2014 up to 3.30 p.m. on 10 of October of , unless extended under the applicable laws. The selling orders may be received by the financial intermediaries until the term of this Competing Offer Period. In accordance with Article 183(2) of the Portuguese Securities Code, the Competing Offer Period may be extended by CMVM, either at the Offeror s request or on its own initiative, in case of revision, launching of a competing offer, or should such extension be required to protect the interests of the addressees. The holders of Shares, who wish to accept the Competing Offer, must transmit the selling orders directly to the financial intermediaries members of the regulated market Euronext Lisbon by Euronext Lisbon with which their securities accounts are opened. The financial intermediaries must provide Banco Finantia (responsible for the assistance to this Competing Offer) with daily information regarding the acceptance and revocation orders received, including the respective amounts, to the address corporatebanking@finantia.com. Pursuant to Articles 126, 185-A(6) and 133(3) of the Portuguese Securities Code, shareholders accepting the Competing Offer are entitled to revoke their acceptance statements through a written notification addressed to the financial intermediary that has received such declaration until the last day of the competing offers period. Financial intermediaries must report daily to Euronext Lisbon the orders of their clients through Central System of Public Offer Services, via Serviço de Centralização, between 8.00 am and 7.00 pm, except as regards the last day of the Competing Offer Period where the period for order transmission through the Public Offer Services will be between 8.00 am and 4.30 pm. The Competing Offer s result will be determined in the Special Regulated Market Session (single session for the purposes of offers in competition), which is expected to take place on 13 October If the Competing Offer is successful, the Competing Offer s physical and financial settlement will occur on the 2 nd business day after the Special Regulated Market Session (single session for the purposes of offers in competition), pursuant to Regulation 3/2004 of Interbolsa and according to what will be established in the notice by the Euronext Lisbon, such settlement being expected that to take place on 15 of October of In accordance with the provisions of Article 189(1)(a) of the Portuguese Securities Code, the Offeror shall benefit from the derogation of the obligation to launch a subsequent mandatory public offer as a result of the acquisition of the Shares within the scope of the Competing Offer, since the Competing Offer is a general offer and meets, at this date, the legal requirements set forth in Article 188 of the 1 Competing offers should run simultaneously and be completed on the same date under the terms of Article 185 A (3) of the Portuguese Securities Code. Page 7 of 60

9 Portuguese Securities Code, regarding the minimum consideration. Once proven these requirements, and provided that, until the term of the Competing Offer Period, the Offeror and/or the entities that are with the Offeror in any of the situations described in Article 20(1) of the Portuguese Securities Code, do not acquire Shares at a price exceeding the consideration price, CMVM shall issue, upon the Offeror s request following the Competing Offer, a statement pursuant to Article 189(2) of the Portuguese Companies Code, in accordance with Article 16 of the Regulation 3/2006 of CMVM. Market on which the Shares are admitted to trading The Shares are admitted to trading on the regulated marked of Euronext Lisbon by Euronext Lisbon under the "ESS" symbol and the ISIN PTEPT0AM0005. Consideration The consideration offered, to be paid in cash, is of 4.82 (four euros and eighty two cents) per Share, deducted of any amount (illiquid) that may be granted to each Share, such as dividends, advance profits of the financial year, or distribution of reserves, such deduction to be made as from the moment on which the right to the concerned amount has been detached from the Shares and if such occurs prior to the financial settlement of the Competing Offer. The following chart presents the premiums offered on the consideration of the Competing Offer in relation to the price per Share of the Target Company (i) in the date of the initial public offering of Shares of the Target Company, (ii) in the date of the preliminary announcement of the Initial Offer, at the price of the Initial Offer, (iii) in the Date of the Preliminary Announcement, and (iv) at the volume weighted average price of the Shares of the Target Company in the regulated market of Euronext Lisbon in different periods prior to the date of the preliminary announcement of Initial Offer and to the Date of the Preliminary Announcement 2 : Source: Euronext Lisbon 2 The reference date of 22 September 2014 was considered to this effect. Page 8 of 60

10 The Competing Offer represents: (i) (ii) (iii) (iv) (v) a premium of 50.63% in relation to the price of the initial public offering of Shares of the Target Company, the results assessment of which took place on 7 February 2014, which was of 3.20 (three euros and twenty cents) per Share; a premium of 29.63% and 34.20% in relation to the weighted average price of the Shares of the Target Company on the three and six months prior, respectively, to the date of the preliminary announcement of the Initial Offer (based on the regulated market of Euronext Lisbon); a premium of 16.08% and 20.97% in relation to the weighted average price of the Shares of the Target Company on the three and six months prior, respectively, to the Date of the Preliminary Announcement (based on the regulated market of Euronext Lisbon) 3 ; a premium of 22.24% in relation to the close price on the date of the preliminary announcement of the Initial Offer; and a premium of 7.11% in relation to the price of the Initial Offer, which represents, in the opinion of the Offeror, an attractive premium to reach a high level of acceptance to the Competing Offer. The Competing Offer, furthermore, represents a consideration superior in 7.11% to the consideration of 4.50 (four euros and fifty cents) proposed in the Initial Offer, thus complying with the provisions of article 185(5) of the Code. On the other hand and although this Competing Offer not being a mandatory public offer, the Competing Offer fulfils requirements set forth in Article 188(1) of the Portuguese Securities Code, being the consideration offered higher: (i) than the highest price paid, directly or indirectly, by the Offeror or by any entity or person who is in any of the situations described in Article 20(1) of the Portuguese Securities Code, during the six months preceding Date of the Preliminary Announcement, which was per Share 4 ; and (ii) the weighted average price of Shares on the regulated market of Euronext Lisbon by Euronext Lisbon during the six months preceding the Date of the Preliminary Announcement which was per Share 5. Chapter 3 of this Prospectus contains a detailed description of the transactions made on the Shares by the Offeror or by any entity or person who is in any of the situations described in Article 20(1) of the Portuguese Securities Code. Conditions to the launching of the Competing Offer The preliminary announcement of the Competing Offer, established the following conditions precedent to the launching of the Competing Offer, which have already been satisfied: 3 The reference date of 22 September 2014 was considered to this effect. 4 The reference date of 22 September 2014 was considered to this effect. 5 The reference date of 22 September 2014 was considered to this effect. Page 9 of 60

11 (a) (b) The Competing Offer was registered with the CMVM under the terms of article 114(2) of the Portuguese Securities Code. On 26 September 2014, the consent for the change of the indirect ownership of the participations that the Target Company owns in SGHL - Sociedade Gestora do Hospital de Loures, S.A. and HL - Sociedade Gestora do Edifício, S.A., was given, as per the joint Order of the State Secretary for Finance and the State Secretary for Health. Conditions of effectiveness of the Competing Offer The effectiveness of the Competing Offer is subject to, until the date and as a result of the physical and financial settlement of the Competing Offer, the Offeror becoming the holder of (or are attributable to the same under the terms of Article 20(1) of the Portuguese Securities Code) at least, 50.01% (fifty point zero one per cent) of Shares representing the registered capital and voting rights of the Target Company. Non-opposition of the Competition Authority The Offeror has filed on 23 of September of 2014, the application for the non-opposition to the concentration transaction in line with the possible purchase by the Offeror of ESS Shares, representing more than 50% of the share capital and voting rights, within this Competing Offer, by the Portuguese Competition Authority. In light of the data available on ESS, such concentration transaction is subject to notification to the Portuguese Competition Authority due to the condition established in Article 27(1)(c) of Law 19/2014 of 8 May (Competition Legal Regime) being fulfilled regarding the business volumes in Portugal of the Offeror and ESS in the year of The Portuguese Competition Authority has not yet issued such non-opposition statement; however, the Offeror considers that the issuance of said statement does not impede the launching and completion of the Competing Offer. In fact, the Offeror exercises the right foreseen in Article 40(2) of Law nr. 19/2012, of 8 May (Competition Legal Regime) that allows for the execution of a public offer of acquisition or of exchange before the Competition Authority has taken a position, provided that the purchaser does not exercise the voting rights inherent to the shares in question, or only exercises such rights in view of protecting the full value of its investments based on the derogation granted under the terms of the referred Article 40 (3). Following the above mentioned notification, the Portuguese Competition Authority may decide in one of the following four ways: (i) declare itself incompetent; (ii) decide in favour of non-opposition to the concentration transaction with no conditions; (iii) decide in favour of non-opposition to the concentration transaction with conditions; (iv) forbid the transaction. Given the competition situation emerging from the transaction, and in particular from the fact that there is no overlap between the activities of the Offeror on one hand, of the Target Company on the other, it is the Offeror s opinion that it is likely that the assessment of the Portuguese Competition Authority will result in the decision described in (ii) above. Page 10 of 60

12 Assumptions of the decision to launch the Competing Offer For the purposes of, namely, the provisions of Article 128 of the Portuguese Securities Code, the Preliminary Announcement and the Launching Announcement provide that the Offeror s decision to launch the Competing Offer was based, on the assumption that, between the Date of the Preliminary Announcement and the term of the Competing Offer Period, none of the following circumstances with a significant impact on the assets, economic and financial position of the Target Company (on consolidated terms) has occurred: a) The adoption, without the prior agreement of the Offeror, of resolutions by the competent corporate bodies of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) that approve: (i) (ii) (iii) (iv) (v) (vi) issuance of shares or other securities, that grant the right to subscribe or acquire shares representative of the registered capital of the Target Company by the latter or by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code); issuance of debt securities by the Target Company or by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), of a value higher than 12,500, (twelve million and five hundred thousand euros); issuance of any other type of securities by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) of a value higher than 12,500, (twelve million and five hundred thousand euros); the dissolution, transformation, merger or demerger or any other amendments to the by-laws of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code); any distribution of assets to shareholders by the Target Company; the redemption or cancellation, by any other form, of shares of the Target Company; (vii) the acquisition, transfer or encumbrance, as well as the promise to acquire, transfer or encumber shares of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code); (viii) the acquisition, transfer or encumbrance, as well as the promise to acquire, transfer or encumber other shareholding of the Target Company or of companies in a control or group relationship with the Target Company (under article 21 of the Portuguese Securities Code); (ix) the acquisition, transfer or encumbrance of, as well as the promise to acquire, transfer or encumber, assets with a value exceeding 1,250, (one million and two Page 11 of 60

13 hundred thousand euros) by, or on behalf of, the Target Company, or by, or on behalf of, the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), including the transfer of business or the assignment, or promise to transfer business or assignment of ownership, or the assumption of undertakings to transfer or assign such assets, save if for the purposes of complying with obligations undertaken until this date and that are of public knowledge; b) The filling of vacancies in the corporate bodies of the Target Company, without ensuring that the dismissal without just cause of the appointed members may occur through the payment of an compensation, the amount of which does not exceed the respective annual remuneration; c) The dismissal of other members of the corporate bodies of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), having as consequence the payment of compensations exceeding the respective annual remunerations outstanding until the end of their respective terms of office; d) Increase of the global remunerations of each of the corporate bodies of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) for 2014 and subsequent years, for a value exceeding the global remuneration of the members of the same corporate bodies in the financial year of 2013, save for an annual increase not higher than 5% (five per cent); e) The performance of any acts by the Target Company or by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) that do not correspond to its ordinary management or that correspond to a breach of the neutrality duty of the management body set out in Article 182 of the Portuguese Securities Code, namely the adoption of defensive measures in respect to the Competing Offer and the transfer of own Shares, either within the Competing Offer, either to third parties, without the consent of the Offeror; f) The performance or refraining from performing, by the Target Company or by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) or by any other entity, of any decision or action or the occurrence of any event or circumstance that may result in a relevant adverse financial change of the situation of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), in respect to the situation evidenced in the consolidated financial statements concerning 31 December 2013, 31 March 2014 and 30 June 2014 or, if existing, in respect to the last half-year or quarterly balance sheet published subsequently to said dates; or g) The disclosure of facts deemed capable of influencing in a significant manner the evaluation of the Shares, but which were not disclosed until this date. Furthermore, for the purposes of Article 128 of the Portuguese Securities Code, the Preliminary Announcement and the Launching Announcement provide that the Offeror s decision to launch the Competing Offer was based on the assumption that, with the exception of the information contained Page 12 of 60

14 in the financial statements or other documents disclosed by the Target Company, prior to the Date of the Preliminary Announcement, there are no and there will not exist any provision (with a material impact on the assets, economic and financial position of the Target Company, on consolidated terms) of any agreement, contract or other instrument to which the Target Company or the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) are a party to, according to which, as a consequence of the launch of the Competing Offer or of the acquisition or proposal to acquire by the Offeror of all or part of the Shares, results that: a) Any loan or liability of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), which, not being immediately due and payable, becomes or may be declared immediately due and payable, or the capacity of any such companies to contract debts or liabilities is diminished or impaired; b) The creation (or the production of effects) of any rights or encumbrances to the benefit of third parties over all or part of the business or assets of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) is allowed; c) Any agreement, right or obligation of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) is terminated or is negatively modified or affected; d) The interest or business of the Offeror, of companies in a control or group relationship with the Offeror (under Article 21 of the Portuguese Securities Code), or of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), in or with, respectively, any person, entity, company or body, is terminated or substantially and negatively modified or affected; or e) The Target Company or the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) cease to be able to carry on their business using their current trade name. It is also an assumption of this Competing Offer, the non-occurrence of any substantial change in the national or international financial markets and in the respective financial institutions, that is not assumed in the official projections disclosed by the competent authorities of the Euro Zone and that have a substantial negative impact on the Competing Offer, exceeding the risks inherent thereto. By launching the Competing Offer, the Offeror does not waive to any rights, in particular the right to request to CMVM the amendment or revocation of the Competing Offer regarding events or acts not consistent with the assumptions provided in the Preliminary Announcement and Launching Announcement, namely those acts or events, which effects or consequences are not yet completely verified or known by the Offeror at the date of publication of the Preliminary Announcement. Page 13 of 60

15 Competing Offer Period The Competing Offer Period will start from 8.30 a.m. on 29 of September of 2014 up to 3.30 p.m. on 10 of October of , unless extended under the applicable laws. The selling orders may be received by the financial intermediaries until the term of the Competing Offer Period. In accordance with Article 183(2) of the Portuguese Securities Code, the Competing Offer Period may be extended by CMVM, either at the Offeror s request or on its own initiative, in case of revision, launching of a competing offer, or should such extension be required to protect the interests of the addressees. The holders of Shares, who wish to accept the Competing Offer, must transmit the selling orders directly to the financial intermediaries members of the regulated market Euronext Lisbon by Euronext Lisbon with which their securities accounts are opened. The financial intermediaries must provide Banco Finantia (responsible for the assistance to this Competing Offer) with daily information regarding the acceptance and revocation orders received, including the respective amounts, to the address corporatebanking@finantia.com. Pursuant to Articles 126, 185-A(6) and 133(3) of the Portuguese Securities Code, shareholders accepting the Competing Offer are entitled to revoke their acceptance statements through a written notification addressed to the financial intermediary that has received such declaration until the last day of the competing offers period. Financial intermediaries must report daily to Euronext Lisbon the orders of their clients through Central System of Public Offer Services, via Serviço de Centralização, between 8.00 am and 7.00 pm, except as regards the last day of the Competing Offer Period where the period for order transmission through the Public Offer Services will be between 8.00 am and 4.30 pm. All costs related to sale of the Shares within the Competing Offer, including brokerage fees, commissions related to regulated market transaction, as well as taxes that fall within the taxable status of the vendor, will be borne by the Competing Offer s addressees. The above mentioned costs shall be indicated by the relevant financial intermediaries at the moment of the selling orders delivery. Financial intermediation commissions are disclosed in the CMVM s website ( The Competing Offer s result will be determined in the Special Regulated Market Session (single session for the purposes of offers in competition), which is expected to take place on 13 October Competing offers should run simultaneously and be completed on the same date under the terms of Article 185 A (3) of the Portuguese Securities Code. Page 14 of 60

16 The Competing Offer s results shall be disclosed by Euronext Lisbon in its Official Bulletin and shall be available in CMVM s website ( In addition, Fosun may disclose a public announcement in this respect in the Hong-Kong Stock Exchange s website ( If the Competing Offer is successful, the Competing Offer s physical and financial settlement will occur on the 2 nd business day after the Special Regulated Market Session (single session for the purposes of offers in competition), such settlement being expected to take place on 15 of October of The Offeror intends to acquire within the Competing Offer, the Shares (that on the date of the Competing Offer term are fully paid-up, with all inherent rights and free of any encumbrances, charges or liabilities, as well as any limitations or duties, notably regarding the respective economic and/or corporate rights and its transferability) representing of the Target Company s registered capital and voting rights, excluding those that are directly held by the Offeror and by any entities which, being with it in any of the situations set forth in Article 20(1) of the Portuguese Securities Code, block their Shares during the Competing Offer Period. However, the effectiveness of the Competing Offer is subject to, until the date and as a result of the physical and financial settlement of the Competing Offer, the Offeror becomes the holder of (or are attributable to the same under the terms of Article 20(1) of the Portuguese Securities Code) at least, 50.01% (fifty point zero one per cent) of Shares representing the registered capital and voting rights of the Target Company. Upon the assessment of the Competing Offer s results, and in accordance with the market conditions, namely at the level of the Target Company and of the liquidity of the Shares after the Competing Offer Period, in case the Offeror reaches or exceeds, directly or under the terms of Article 20(1) of the Portuguese Securities Code, (i) 90% (ninety per cent) of the voting rights corresponding to the registered capital of the Target Company, and (ii) 90% (ninety per cent) of the voting rights encompassed by the Competing Offer as a consequence of the Competing Offer or of any other transactions legally allowed and relevant for the calculation of said percentage, the Offeror reserves the right, within the three months subsequent to the end of the Competing Offer Period, to resort to the squeeze-out mechanism set forth in Article 194 of the Portuguese Securities Code, which will imply the immediate exclusion from trading in a regulated market, the respecting re-admission being impaired for a period of 1 year. The Offeror, in case it does not exercise the rights referred to in the preceding paragraph, will not request, following the Competing Offer, the loss of listed company status of the Target Company under the terms of Article 27(1)(a) of the Portuguese Securities Code, in which case the Shares shall continue to be traded in the regulated market of Euronext Lisbon. The Offeror is in conditions to exercise the mentioned rights if, at date of the physical and financial settlement of the Competing Offer, the Offeror, or the entities that, are with the Offeror in one of the situations set forth in Article 20(1) of the Portuguese Securities Code, is the owner of 85,988,029 Shares (i.e. 90% of the voting rights corresponding to the share capital of the Target Company) of which 85,986,675 Shares (i.e. 90% of the voting rights covered by the Competing Offer) must be acquired within the scope of the Competing Offer, since the Offeror is attributed, directly and under Page 15 of 60

17 the terms of Article 20(1) of the Portuguese Securities Code, voting rights corresponding to 1,504 Shares. Rights of prior offerors Under the terms of Article 185-B of the Portuguese Securities Code, the launch of this Competing Offer entitle any prior offeror to review the terms of its offer, irrespective of having already done so or not under Article 184 of the Portuguese Securities Code. If any offeror intends to exercise such right, it shall notify its decision to CMVM and publish an announcement within four business days as of the launch of this Competing Offer. Failing such publication, the terms of the offer are deemed to have been maintained. Any review of offers shall have to comply with the provisions of Article 185(5) of the Portuguese Securities Code, i.e., the consideration offered shall be, at least, 2% above of the consideration offered in the preceding offer and cannot contain conditions that make them become less favourable. The launching of a competing offer may constitute grounds for a revocation of any prior offer, provided that such revocation decision is immediately published under the terms of article 185-B(5) of the Portuguese Securities Code. The Offeror, directly or through its financial advisers or agents that may be used for this purpose, may acquire Shares out of the scope of the Competing Offer. These acquisitions may occur at any time, at the prices in force at that time, provided that the price is not higher than the Competing Offer s price. The acquisitions of Shares made by the Offeror after the Date of the Preliminary Announcement, shall be taken into account for the purposes of the assessment of the fulfilment of the effectiveness condition of the Competing Offer, i.e., that as a result of the physical and financial settlement of the Competing Offer, the Offeror becomes the holder of (or are attributable to the same under the terms of Article 20(1) of the Portuguese Securities Code) at least, 50.01% (fifty point zero one per cent) of Shares representing the registered capital and voting rights of the Target Company. The acquisitions of Shares and the disclosure duties with reference to the same, shall be made in accordance with the provisions of Article 180 of the Portuguese Securities Code, in particular (i) such acquisitions shall take place in the regulated market of Euronext Lisbon by Euronext Lisbon, unless otherwise dully authorized by CMVM with the Target Company s prior opinion and (ii) the Offeror and the persons that are with the Offeror in any of the situations described in Article 20(1) inform CMVM, on a daily basis, of the transactions of Shares, made by any of them Registration Effects The Competing Offer has been registered with the CMVM under the number Pursuant to Article 118(6) and (7) of the Portuguese Securities Code, the registration of the public takeover offer requires the approval of the prospectus and is based on legal criteria and The prospectus approval and the registration do not involve any warranty concerning to the contents of the Page 16 of 60

18 information, the economic or financial condition of the offeror, the issuer or the guarantor, to the offer s viability or to quality of the securities. The financial intermediary responsible for providing assistance to the Competing Offer under the terms and for the purposes set forth in Article 113(1)(b) and Article 337(2) of the Portuguese Securities Code, namely for the services of preparation, launching and execution of the Competing Offer, is Banco Finantia. Page 17 of 60

19 Identification of the persons responsible CHAPTER 1 PERSONS RESPONSIBLE FOR THE INFORMATION The form and the contents of this Prospectus comply with the Portuguese Securities Code, the Regulation 3/2006 of CMVM, and all other applicable laws and regulations. In accordance with Articles 149 and 150 of the Portuguese Securities Code, the persons listed below are responsible for any damages caused by the non-compliance of this Prospectus contents (as of its publication date) with the provisions of Article 135 of the Portuguese Securities Code, except if they prove to have acted without fault. The Offeror: Fidelidade Fidelidade s Board of Directors: Chairman: Vice-Chairman: Vice-Chairman: Members: GUO Guangchang João Nuno de Oliveira Jorge Palma Jorge Manuel Baptista Magalhães Correia WANG Qunbin Nuno Maria Pinto de Magalhães Fernandes Thomaz Jorge Telmo Maria Freire Cardoso DING Guoqi LEE Michael FU Jian XU Yao José Manuel Alvarez Quintero António Manuel Marques de Sousa Noronha Rogério Miguel Antunes Campos Henriques William Mak Financial intermediary assisting the Competing Offer: Banco Finantia Pursuant to Article 149(2) of the Portuguese Securities Code, the fault will be assessed under high standards of professional diligence. Under Article 149(3) of the Portuguese Securities Code, the liability of the persons mentioned above is excluded if it is proven that the addressees knew or should have known of this Prospectus inaccuracy at the date of issuance of their statement of acceptance or until the moment where the revocation of the acceptance was still permitted. Under Article 150(a) of the Portuguese Securities Code, the Offeror will be liable, regardless of fault, in case of responsibility of its Board of Directors or of Banco Finantia, the latter as financial intermediary responsible for assisting the Competing Offer. The information contained in this Prospectus regarding ESS comes from and is based on public information, which has not been independently appraised by the Offeror or the Financial Intermediary. The Offeror, the Financial Intermediary and the members of the Board of Directors of the Offeror are not aware of any events or circumstances indicating that any Page 18 of 60

20 statement contained herein, with reference to ESS, is not true or is materially misleading. However, the Offeror, the Financial Intermediary and the members of the Board of Directors of the Offeror do not make any representation concerning the accuracy and completeness of the information contained herein concerning ESS. In addition the Offeror, the Financial Intermediary and the members of the Board of Directors of the Offeror do not assume any responsibility for the non-compliance by ESS of its obligation to disclose any events that may have occurred by virtue of which the information contained herein and the information on which the Offeror, the Financial Intermediary and the members of the Board of Directors of the Offeror have considered, is inaccurate or misleading. Page 19 of 60

21 2.1. Amount and nature of the transaction CHAPTER 2 DESCRIPTION OF THE OFFER The Competing Offer is a general and voluntary Offer and encompasses all Shares issued and outstanding that represent the registered capital of the Target Company, excluding those that are directly held by the Offeror and by any entities which, being with it in any of the situations set forth in Article 20(1) of the Portuguese Securities Code, block their Shares during the Competing Offer Period. The Offeror undertakes to acquire, pursuant to the terms and conditions laid down in the present Prospectus, all Shares of the Target Company that are the object of a valid acceptance within the scope of the Competing Offer. Only the Shares which, at the date of closing of the Competing Offer, are fully paid-up, with all inherent rights and free of any encumbrances, charges or liabilities, as well as any limitations or duties, notably regarding the respective economic and/or corporate rights and its transferability, can be the object of acceptance. The acceptance of the Competing Offer by its addressees is subject to the performance of the respective legal and regulatory requirements, including foreign law requirements, whenever the addressees of the Competing Offer are subject to such foreign law. The Offeror, at the date hereof, holds 1,504 (one thousand and five hundred and four) Shares representing % (zero point zero zero sixteen per cent) of the registered capital and voting rights of the Target Company. Under the terms of Article 20(1) of the Portuguese Securities Code and to the best of the Offeror s knowledge, at the date hereof, no other voting rights corresponding to Shares are attributable to the Offeror. Considering the Target Company s shares attributable to the Offeror, the securities covered by the Offer are 95,540,750 Shares, corresponding to approximately 99.99% of the registered share capital and voting rights of the Target Company Amount, nature and class of securities that are subject of the Competing Offer The Target Company s share capital is represented by 95,542,254 ordinary shares, nominative and in book entry form, with the nominal value of 1.00 each, which are admitted to trading in the regulated market of Euronext Lisbon by Euronext Lisbon and with the ISIN code PTEPT0AM0005. According to a notification dated 30 July 2014 and disclosed in CMVM s website ( the Target Company owned, at such date, 54,385 own Shares. Taking into account the Shares currently attributable to the Offeror under Article 20(1) of the Portuguese Securities Code, only 95,540,750 Shares can be object of acceptance under the Competing Offer. Page 20 of 60

22 The acceptance of the Competing Offer is limited to the Shares that, at the date of closing of the Competing Offer, are fully paid-up, with all inherent rights and free of any encumbrances, charges or liabilities, as well as any limitations or duties, notably regarding the respective economic and/or corporate rights and its transferability, including when such restriction to the transferability results from the order of blockage of Shares in the respective securities account given by the respective holder, pursuant to Article 72(2)(a) of the Portuguese Securities Code. The Offeror undertakes to purchase all the Shares that are the object of valid acceptance of the Competing Offer and that comply with the terms and conditions established in the present Prospectus, notably if the addressees of the Competing Offer accept to sell an amount of Shares that enables that, as a result of the physical and financial settlement of the Competing Offer, the Offeror becomes the holder of (or are attributable to the same under the terms of Article 20(1) of the Portuguese Securities Code) at least, 50.01% (fifty point zero one per cent) of Shares representing the registered capital and voting rights of the Target Company. Under the terms of Article 189(1)(a) and 189(2) of the Portuguese Securities Code, the Offeror shall benefit of the derogation of the obligation to launch a subsequent mandatory public offer as a result of the acquisition in case of success of the Competing Offer, since this is general and complies, on this date, with the requirements relative to the minimum compensation provided in Article 188 of the Portuguese Securities Code for the mandatory offers. Upon evidence of these assumptions, and provided that the Offeror and/or the persons that are with the latter in one of the situations provided in Article 20(1) of the Portuguese Securities Code do not acquire Shares for a price superior to the compensation under the Competing Offer until the term of this latter, CMVM shall issue the declaration provided in Article 189(2) of the Portuguese Securities Code through application of the Offeror following the Competing Offer, under the terms of provisions of Article 16 of Regulation 3/2006 of CMVM. The availability of the Competing Offer and its acceptance by entities or persons that are not residents in Portugal may be affected by the laws of the relevant jurisdiction. Any non-resident person in Portugal shall inform itself concerning the applicable legal requirements and comply with the latter Consideration offered and its justification Amount of the consideration The consideration offered, to be paid in cash, is of 4.82 (four euros and eighty two cents) per Share, deducted of any amount (illiquid) that may be granted to each Share, such as dividends, advance profits of the financial year, or distribution of reserves, such deduction to be made as from the moment on which the right to the concerned amount has been detached from the Shares and if such occurs prior to the financial settlement of the Competing Offer. Considering that the Competing Offer is general and voluntary, the consideration must not comply with the minimum consideration requirements set forth in Article 188(1) of the Portuguese Securities Code. This provision sets forth that the consideration offered in mandatory takeover offers cannot be less than the highest of the following amounts: Page 21 of 60

23 (i) (ii) the highest price paid by the Offeror, or by persons who are with it in any of the situations set forth in Article 20(1) of the Portuguese Securities Code, for the acquisition of securities of the same category as the Shares, within the six months immediately prior to the Date of the Preliminary Announcement; and the weighted average price of the securities of the same category as the Shares, traded in Euronext Lisbon by Euronext Lisbon, within the six months immediately prior to the Date of the Preliminary Announcement. The Competing Offer, furthermore, represents a consideration superior in 7.11% to the consideration of 4.50 proposed in the Initial Offer, thus complying with the provisions of Article 185(5) of the Portuguese Securities Code. Even though the Competing Offer is not a mandatory takeover offer, the consideration of the Competing Offer complies with the requirements laid down in Article 188 of the Portuguese Securities Code, given that it exceeds: (i) the highest price paid, directly or indirectly, by the Offeror or by any person/entity who is with it in the situations set forth in Article 20(1) of the Portuguese Securities Code during the six months preceding the date of the Preliminary Announcement, which was of per Share 7 ; and (ii) the weighted average price of securities of the same category as the Shares, traded in Euronext Lisbon by Euronext Lisbon, during the six months preceding the Date of the Preliminary Announcement, which was of was per Share 8. Justification of the consideration The Competing Offer represents: (i) (ii) (iii) (iv) (v) a premium of 50.63% in relation to the price of the initial public offering of Shares of the Target Company, the results assessment of which took place concluded on 07 February 2014, which was of 3.20 (three euros and twenty cents) per Share; a premium of 29.63% and 34.20% in relation to the weighted average price of the Shares of the Target Company on the three and six months prior, respectively, to the date of the preliminary announcement of the Initial Offer (based on the regulated market of Euronext Lisbon); a premium of 16.08% and 20.97% in relation to the weighted average price of the Shares of the Target Company on the three and six months prior, respectively, to the Date of the Preliminary Announcement (based on the regulated market of Euronext Lisbon) 9 ; a premium of 22.24% in relation to the close price on the date of the preliminary announcement of the Initial Offer; and a premium of 7.11% in relation to the price of the Initial Offer, 7 The reference date of 22 September 2014 was considered to this effect. 8 The reference date of 22 September 2014 was considered to this effect. 9 The reference date of 22 September 2014 was considered to this effect. Page 22 of 60

24 which represents, in the opinion of the Offeror, an attractive premium to reach a high level of acceptance to the Competing Offer. During the six months immediately preceding the Date of the Preliminary Announcement, no transactions of Shares for a price higher than the value of the proposed consideration have taken place, neither by the Offeror nor, to the best of its knowledge by any of the persons or entities that are with the Offeror in any of the situations foreseen in Article 20(1) of the Portuguese Securities Code. In addition, between the Date of the Preliminary Announcement and the date of the registration of the Competing Offer, no acquisition of Shares by the Offeror or by any persons in any of the situations described in Article 20(1) of the Portuguese Securities Code has taken place. Between the date of the initial public offering of Shares of the Target Company, which admission to trading occurred in 12 February 2014, and the Date of the Preliminary Announcement 10, the price per Share of the Target Company increased 46.88%, while the Portuguese equity market took the opposite direction. During the referred period, PSI-20 index fell 15.99%. Below is presented a chart illustrating the evolution of the daily volume weighted average price of the Shares and the daily trading volume between the date of the initial public offering of Shares of the Target Company and the Date of the Preliminary Announcement (between 12 February 2014 and 22 September 2014). The chart also includes, for comparison purposes, the evolution of the PSI-20 Index and the consideration offered in the Competing Offer, as well as the volume weighted average price in the six months prior to the date of the preliminary announcement of the Initial Offer. Source: Euronext Lisbon Note: The calculation of the volume weighed average price per share (VWAP) was determined based on the price per each transaction occurred on the regulated market sessions of Euronext Lisbon during the respective period. 10 The reference date of 22 September 2014 was considered to this effect. Page 23 of 60

25 Below is presented an illustrative table with the premiums offered on the consideration of the Competing Offer in relation to the price per Share of the Target Company (i) in the date of the initial public offering of Shares of the Target Company, (ii) in the date of the preliminary announcement of the Initial Offer, at the price of the Initial Offer, (iii) in the Date of the Preliminary Announcement 11, and (iv) at the volume weighted average price of the Shares of the Target Company in the regulated market of Euronext Lisbon in different periods prior to the date of the preliminary announcement of Initial Offer and to the Date of the Preliminary Announcement 12 : Source: Euronext Lisbon The volume weighted average price of the Shares of the Target Company in the regulated market of Euronext Lisbon during the six months prior to the date of the preliminary announcement of the Initial Offer was During this period it were traded 24,049,703 Shares, an amount equivalent to 25% of all Shares of the Target Company, and 51% of all Shares not held by Espírito Santo Healthcare Investments, S.A., the majority shareholder. Therefore, the consideration offered in the Competing Offer represents a premium of 34.20% in relation to the volume weighted average price of the Shares of the Target Company during the six months prior to the date of the preliminary announcement of the Initial Offer. The volume weighted average price of the Shares of the Target Company in the regulated market of Euronext Lisbon during the six months prior to the Date of the Preliminary Announcement was During this period, the Initial Offer made by GASS was already known by the market, and were traded 34,647,412 Shares, an amount equivalent to 36% of all Shares of the Target Company, and 74% of all Shares not held by Espírito Santo Healthcare Investments, S.A., the majority shareholder. Therefore, the consideration offered in the Competing Offer represents a premium of 20.97% in relation to the volume weighted average price of the Shares of the Target Company during the six months prior to the Date of the Preliminary Announcement The reference date of 22 September 2014 was considered to this effect. 12 The reference date of 22 September 2014 was considered to this effect. 13 The reference date of 22 September 2014 was considered to this effect. 14 The reference date of 22 September 2014 was considered to this effect. Page 24 of 60

26 The consideration offered in the Competing Offer represents a premium of 50.63% in relation to the price per Share on the initial public offering of Shares of the Target Company. As a result of the analysis made above, the Offeror considers that the consideration offered in the Competing Offer fulfils, although not necessary, to the requirements of the Article 188(1) of the Portuguese Securities Code for mandatory public takeover offers, therefore exceeding the amount that results from the application of such legal requirements as described above. The Consideration offered in the context of price targets of the Target Company published by analysts The table below illustrates the price targets of the Target Company made by equity analysts (as per publication in Bloomberg) in a moment prior to the date of the preliminary announcement of the Initial Offer: Analysts Target Price per Share ( ) Date Recomendation BBVA Hold BPI Buy Caixa BI Hold Credit Suisse Buy Kepler Cheuvreux Hold Millennium Buy Santander Hold Average Median Source: Bloomberg in 19 of August 2014 According to Bloomberg, the average of the price targets made by analysts with respect to the Target Company in 19 August 2014 was 4.257, and the median was The consideration offered in the Competing Offer of 4.82 in cash is 13.2% and 14.8% higher than the average and the median, respectively, of the price target recommendations made by analysts with respect to the Target Company. Premium in relation to the trading multiples of comparable companies In Portugal there are no comparable public listed companies, given that the main comparable companies operating in the health services industry (i.e. José de Mello Saúde and HPP currently with the brand Lusíadas Saúde) are both corporations that its shares are not traded in the regulated market. Nevertheless, illustratively some companies operating in the same industry as the Target Company in Europe and in North America were selected. The comparability level is limited considering that European and North American companies operate in different regulatory and fiscal regimes, and in some cases in markets with substantially different growth profiles. The table below presents the trading multiples of European and North American companies operating in the health services sector as of 22 September 2014: Page 25 of 60

27 Companies Country Market Cap. ( mn) EV / SALES EV / EBITDA EV / EBIT P / E 2014E 2015E 2016E 2014E 2015E 2016E 2014E 2015E 2016E 2014E 2015E 2016E Generale De Sant France x 0.9x n.a. 7.5x 7.3x n.a. 16.1x 15.9x n.a. 25.2x 23.8x n.a. Korian-Medica France 2, x 1.2x 1.1x 9.4x 8.1x 7.5x 13.8x 11.3x 10.3x 25.4x 19.1x 16.8x Orpea France 2, x 2.1x 1.9x 12.7x 11.3x 10.6x 16.5x 14.6x 13.3x 21.1x 18.4x 16.3x Fresenius Medica Germany 16, x 1.9x 1.8x 10.6x 9.7x 9.0x 13.8x 12.6x 11.6x 19.6x 17.5x 15.8x Mediclin Ag Germany x 0.4x 0.4x 10.0x 8.2x 6.7x 44.8x 23.6x 15.2x n.a. 36.1x 18.0x Rhoen-Klinikum Germany 3, x 1.1x 1.0x 9.7x 7.8x 7.3x 14.2x 12.3x 11.4x 45.0x 26.9x 22.6x Clinica Baviera Spain x 1.7x 1.6x 11.6x 9.7x 8.4x 18.2x 13.8x 11.3x 25.6x 18.9x 15.1x Brookdale Sr United States 4, x 1.7x 1.6x 13.7x 9.0x 8.3x 40.8x 17.7x 14.7x n.a x 48.5x Community Health United States 5, x 1.2x 1.1x 8.4x 7.5x 7.2x 14.8x 12.8x 12.1x 18.4x 14.1x 12.0x Hca Holdings Inc United States 24, x 1.6x 1.5x 8.6x 8.1x 7.6x 11.5x 10.8x 10.0x 17.3x 15.3x 13.4x Lifepoint Hospit United States 2, x 1.1x 1.1x 8.6x 7.8x 7.4x 14.7x 13.4x 12.3x 23.7x 20.5x 18.0x Select Medical United States 1, x 1.1x 1.0x 9.0x 8.5x 8.0x 11.2x 10.7x 9.7x 13.5x 12.1x 10.9x Tenet Healthcare United States 4, x 1.0x 1.0x 9.2x 8.1x 7.6x 16.4x 13.5x 12.4x 44.8x 21.9x 16.8x Universal Hlth-B United States 8, x 1.7x 1.6x 9.9x 9.2x 8.6x 12.9x 11.9x 10.9x 19.6x 17.9x 16.0x Median 1.3x 1.2x 1.1x 9.6x 8.2x 7.6x 14.8x 13.1x 11.6x 22.4x 19.0x 16.3x Offer Price ESS ( 4.72) 1.7x 1.6x 1.6x 10.6x 10.1x 9.5x 19.5x 17.7x 16.2x 26.3x 22.0x 19.2x Implicit Price per Share based on comparable multiples Implicit Price in the Offer 44.9% 61.6% 62.4% 15.9% 36.3% 39.9% 50.9% 57.8% 64.9% 17.4% 15.6% 18.0% Source: Bloomberg in Notes: Price per share of the Target Company implicit in the comparable multiple (median) was calculated: For the multiples P/E (Price to Earnings): each multiple was applied to the respective estimated net income for the Target Company and divided directly by the number of shares of the Target Company. For EV multiples (Enterprise Value): each multiples was applied to the respective operating financial indicator Target Company less the net financial debt, less minorities and plus investments in associates. This result was divided by the number of shares of the Target Company. EV, EBITDA, EBIT, P/E are defined in the section definitions. The table above shows the trading multiples of a selected set of companies operating in the health sector in Europe and North America. The trading multiples consist in ratios commonly used as a valuation methodology. These ratios, obtained through the quotient between the market (Market Capitalization or Enterprise Value) and several financial indicators (e.g. Sales, EBITDA, EBIT and Net Income), permit to assess companies by the application of multiples obtained by the financial results of the company being evaluated. In this case, it was applied the median of this set of companies to the financial indicator of ESS in order to obtain the implicit value. Therefore, is possible to compare the value of the consideration offered in the Competing Offer with the obtained implicit value. As a result of the above analysis, the consideration offered presents different levels of premiums in relation to the price per Share implicit of ESS in different comparable trading multiples. Consequently, the implicit premium considering the EV/Sales 2014E is 44.9%; considering EV/EBITDA 2014E is 15.9%; considering EV/EBIT 2014E is 50.9%; and considering P/E 2014E is 17.4%. Details on the calculation of the trading multiples For the calculation of the trading multiples in the consideration offered in the Competing Offer and for the comparable companies, it was used the following formulas: EV (Enterprise Value) = Equity + Net Financial Debt + Minorities Investments in Associates; Equity (Market Capitalization) = number of shares * price per share as of 22 September 2014 (with the exception of ESS, on which was used the price of the consideration of the Competing Offer); Page 26 of 60

28 P/E (Price to Earnings) = Price of the share divided by the net income per share according to the latest available information. Enterprise Value of ESS The Enterprise Value used to compute the implicit multiples for the consideration offered to the Shares of ESS was million, calculated as follows: (+) Equity of ESS: million ( 4.82 per Share * 95,487,869 Shares (excluding own shares held by ESS)) (+) Net Financial Debt: million (Interim report and accounts of the 1 st half of 2014 of ESS) (+) Minority Interests: 1.5 million (Interim report and accounts of the 1 st half of 2014 of ESS) (-) Investments in Associates: 1.6 million (Interim report and accounts of the 1 st half of 2014 of ESS) ESS Figures The consolidated financial figures of ESS used in the calculation of the multiples correspond to the market analysts estimations available on Bloomberg consensus as of 22 September 2014, as indicated in the table below: ESS Euro Millions 2014E 2015E 2016E Sales EBITDA EBIT Net Income Source: Bloomberg (Consensus as of 22 September 2014) According to the respective annual reports and accounts of ESS, the book value per Share in 31 December 2012, 31 December 2013 and 30 June 2014 was, respectively, of 1.44, 1.60 and The consideration of the Competing Offer represents a premium of 234.7%, 201.0% and 168.2% relative to the book value per share in 31 December 2012, 31 December 2013 and 30 June 2014, respectively. Multiples of comparable companies The multiples of the comparable companies are calculated based on the following assumptions, using figures from Bloomberg in 22 of September of 2014: Page 27 of 60

29 Enterprise Values based (i) market price per share of comparable companies in the closing of the market in 22 September 2014; (ii) on the last available figures of Net Financial Debt in 22 of September of 2014; (iii) on the last available figures of minority interests in 22 of September of 2014; (iv) on the last available figures of own shares in 22 of September of 2014; and (v) last available figures of investments in associates in 22 of September of Financial figures of 2014E, 2015E and 2016 according to the analysts estimations available on Bloomberg consensus as of 22 of September of Exemption from the mandatory obligation to launch a takeover As demonstrated in the previous section Justification of the consideration, and even though the Competing Offer is not a mandatory takeover offer, the consideration offered under the Competing Offer complies with the requirements laid down in Article 188 of the Portuguese Securities Code, given that it exceeds: (i) the highest price paid, directly or indirectly, by the Offeror or by any person/entity who is with it in the situations set forth in Article 20(1) of the Portuguese Securities Code during the six months preceding the date of the Preliminary Announcement, which was of per Share 15 ; and (ii) the weighted average price of the securities of the same category as the Shares, traded in Euronext Lisbon by Euronext Lisbon, within the six months immediately prior to the Date of the Preliminary Announcement, which was of was per Share 16. Chapter 3 contains a detailed description of the transactions over Shares carried out by the Offeror and by any person/entity who is with it in any of the situations set forth in Article 20(1) of the Portuguese Securities Code. Under the terms of Article 189(1)(a) and 189(2) of the Portuguese Securities Code, the Offeror shall benefit of the derogation of the obligation to launch a subsequent mandatory public offer as a result of the acquisition in case of success of the Competing Offer, since this is general and complies, on this date, with the requirements relative to the minimum compensation set forth in Article 188 of the Portuguese Securities Code for the mandatory offers. Upon evidence of these assumptions, and provided that the Offeror and/or the persons that are with the latter in one of the situations set forth in Article 20(1) of the Portuguese Securities Code do not acquire Shares for a price superior to the compensation under the Competing Offer until the term of this latter, CMVM shall issue the declaration set forth in Article 189(2) of the Portuguese Securities Code through application of the Offeror following the Competing Offer, under the terms of provisions of Article 16 of Regulation 3/2006 of CMVM Method of payment of the consideration The result of the Competing Offer will be determined in the Special Regulated Market Session (single session for the purposes of offers in competition), expected to take place on 13 of October of 2014, the first business day after the term of the Competing Offer Period, in a time to be established in the respective notice of the Special Regulated Market Session to be published by Euronext Lisbon. The consideration will be paid in cash and will be available on the second working day after the Special Regulated Market Session. 15 The reference date of 22 September 2014 was considered to this effect. 16 The reference date of 22 September 2014 was considered to this effect. Page 28 of 60

30 If the Competing Offer is successful, the physical and financial settlement of the Competing Offer will occur on the second working day of the Special Regulated Market Session pursuant to Regulation 3/2004 of Interbolsa and in the terms set forth in the notice of Regulated Market Special Session relating to the Competing Offer, and such settlement is expected to take place on 15 of October of Security or guarantee for consideration The total amount of the consideration offered under the terms of this Competing Offer corresponding to a maximum of 460,506, is ensured in accordance with 177(2) of the Portuguese Securities Code. For such purpose the Offeror has deposited with the Bank Caixa Geral de Depósitos, S.A. and with Banco Finantia, S.A. the necessary funds for payment of the full amount of consideration offered in the present Competing Offer and evidence thereof has been submitted to the CMVM. Therefore, the necessary funds for the payment of the total amount of the consideration offered under this Competing Offer are duly ensured, and blocked for the purposes of the settlement of the Competing Offer Terms of the Competing Offer The Competing Offer is general and voluntary and the Offeror undertakes to acquire all Shares that are the object of a valid acceptance, excluding those that are directly held by the Offeror and by any entities which, being with it in any of the situations set forth in Article 20(1) of the Portuguese Securities Code, block their Shares during the Competing Offer Period. Conditions for the launching of the Competing Offer The preliminary announcement of the Competing Offer, established the following conditions precedent to the launching of the Competing Offer, which have already been satisfied: (a) (b) The Competing Offer was registered with the CMVM under the terms of article 114(2) of the Portuguese Securities Code. On 26 September 2014, the consent for the change of the indirect ownership of participations that the Target Company owns in SGHL - Sociedade Gestora do Hospital de Loures, S.A. and HL - Sociedade Gestora do Edifício, S.A., was given, as per the joint Order of the State Secretary for Finance and the State Secretary for Health. Non-opposition of the Competition Authority The Offeror has filed on 23 of September of 2014, the application for the non-opposition to the concentration transaction in line with the possible purchase by the Offeror of ESS Shares, representing more than 50% of the share capital and voting rights, within this Competing Offer, by the Portuguese Competition Authority. Page 29 of 60

31 In light of the data available on ESS, such concentration transaction is subject to notification to the Portuguese Competition Authority due to the condition established in Article 27(1)(c) of Law 19/2014 of 8 May (Competition Legal Regime) being fulfilled regarding the business volumes in Portugal of the Offeror and ESS in the year of The Portuguese Competition Authority has not yet issued such non-opposition statement; however, the Offeror considers that the issuance of said statement does not impede the launching and completion of the Competing Offer. In fact, the Offeror exercises the right foreseen in Article 40(2) of Law nr. 19/2012, of 8 May (Competition Legal Regime) that allows for the execution of a public offer of acquisition or of exchange before the Competition Authority has taken a position, provided that the purchaser does not exercise the voting rights inherent to the shares in question, or only exercises such rights in view of protecting the full value of its investments based on the derogation granted under the terms of the referred Article 40 (3). Following the above mentioned notification, the Portuguese Competition Authority may decide in one of the following four ways: (i) declare itself incompetent; (ii) decide in favour of non-opposition to the concentration transaction with no conditions; (iii) decide in favour of non-opposition to the concentration transaction with conditions; (iv) forbid the transaction. Given the competition situation emerging from the transaction, and in particular from the fact that there is no overlap between the activities of the Offeror on one hand, of the Target Company on the other, it is the Offeror s opinion that it is likely that the assessment of the Portuguese Competition Authority will result in the decision described in (ii) above. Conditions to the effectiveness of the Competing Offer The effectiveness of the Competing Offer is subject to, until the date and as a result of the physical and financial settlement of the Competing Offer, the Offeror becoming the holder of (or are attributable to the same under the terms of Article 20(1) of the Portuguese Securities Code) at least, 50.01% (fifty point zero one per cent) of Shares representing the registered capital and voting rights of the Target Company. Assumptions of the decision to launch the Competing Offer For the purposes of, namely, the provisions of Article 128 of the Portuguese Securities Code, the Preliminary Announcement and the Launching Announcement provide that the Offeror s decision to launch the Competing Offer was based, on the assumption that, between the Date of the Preliminary Announcement and the term of the Competing Offer Period, none of the following circumstances with a significant impact on the assets, economic and financial position of the Target Company (on consolidated terms) has occurred: a) The adoption, without the prior agreement of the Offeror, of resolutions by the competent corporate bodies of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) that approve: (i) issuance of shares or other securities, that grant the right to subscribe or acquire shares representative of the registered capital of the Target Company by the latter or by Page 30 of 60

32 companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code); (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) issuance of debt securities by the Target Company or by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), of a value higher than 12,500, (twelve million and five hundred thousand euros); issuance of any other type of securities by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) of a value higher than 12,500, (twelve million and five hundred thousand euros); the dissolution, transformation, merger or demerger or any other amendments to the bylaws of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code); any distribution of assets to shareholders by the Target Company; the redemption or cancellation, by any other form, of shares of the Target Company; the acquisition, transfer or encumbrance, as well as the promise to acquire, transfer or encumber shares of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code); the acquisition, transfer or encumbrance, as well as the promise to acquire, transfer or encumber other shareholding of the Target Company or of companies in a control or group relationship with the Target Company (under article 21 of the Portuguese Securities Code); the acquisition, transfer or encumbrance of, as well as the promise to acquire, transfer or encumber, assets with a value exceeding 1,250, (one million and two hundred thousand euros) by, or on behalf of, the Target Company, or by, or on behalf of, the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), including the transfer of business or the assignment, or promise to transfer business or assignment of ownership, or the assumption of undertakings to transfer or assign such assets, save if for the purposes of complying with obligations undertaken until this date and that are of public knowledge; b) The filling of vacancies in the corporate bodies of the Target Company, without ensuring that the dismissal without just cause of the appointed members may occur through the payment of an compensation, the amount of which does not exceed the respective annual remuneration; c) The dismissal of other members of the corporate bodies of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), having as consequence the payment of compensations exceeding the respective annual remunerations outstanding until the end of their respective terms of office; Page 31 of 60

33 d) Increase of the global remunerations of each of the corporate bodies of the Target Company or of companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) for 2014 and subsequent years, for a value exceeding the global remuneration of the members of the same corporate bodies in the financial year of 2013, save for an annual increase not higher than 5% (five per cent); e) The performance of any acts by the Target Company or by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) that do not correspond to its ordinary management or that correspond to a breach of the neutrality duty of the management body set out in Article 182 of the Portuguese Securities Code, namely the adoption of defensive measures in respect to the Competing Offer and the transfer of own Shares, either within the Competing Offer, either to third parties, without the consent of the Offeror; f) The performance or refraining from performing, by the Target Company or by companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) or by any other entity, of any decision or action or the occurrence of any event or circumstance that may result in a relevant adverse financial change of the situation of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), in respect to the situation evidenced in the consolidated financial statements concerning 31 December 2013, 31 March 2014 and 30 June 2014 or, if existing, in respect to the last half-year or quarterly balance sheet published subsequently to said dates; or g) The disclosure of facts deemed capable of influencing in a significant manner the evaluation of the Shares, but which were not disclosed until this date. Furthermore, for the purposes of Article 128 of the Portuguese Securities Code, the Preliminary Announcement and the Launching Announcement provide that the Offeror s decision to launch the Competing Offer was based on the assumption that, with the exception of the information contained in the financial statements or other documents disclosed by the Target Company, prior to the Date of the Preliminary Announcement, there are no and there will not exist any provision (with a material impact on the assets, economic and financial position of the Target Company, on consolidated terms) of any agreement, contract or other instrument to which the Target Company or the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) are a party to, according to which, as a consequence of the launch of the Competing Offer or of the acquisition or proposal to acquire by the Offeror of all or part of the Shares, results that: a) Any loan or liability of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), which, not being immediately due and payable, becomes or may be declared immediately due and payable, or the capacity of any such companies to contract debts or liabilities is diminished or impaired; b) The creation (or the production of effects) of any rights or encumbrances to the benefit of third parties over all or part of the business or assets of the Target Company or of the companies in a Page 32 of 60

34 control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) is allowed; c) Any agreement, right or obligation of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) is terminated or is negatively modified or affected; d) The interest or business of the Offeror, of companies in a control or group relationship with the Offeror (under Article 21 of the Portuguese Securities Code), or of the Target Company or of the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code), in or with, respectively, any person, entity, company or body, is terminated or substantially and negatively modified or affected; or e) The Target Company or the companies in a control or group relationship with the Target Company (under Article 21 of the Portuguese Securities Code) cease to be able to carry on their business using their current trade name. It is also an assumption of this Competing Offer, the non-occurrence of any substantial change in the national or international financial markets and in the respective financial institutions, that is not assumed in the official projections disclosed by the competent authorities of the Euro Zone and that have a substantial negative impact on the Competing Offer, exceeding the risks inherent thereto. By launching the Competing Offer, the Offeror does not waive to any rights, in particular the right to request to CMVM the amendment or revocation of the Competing Offer regarding events or acts not consistent with the assumptions provided in the Preliminary Announcement and Launching Announcement, namely those acts or events, which effects or consequences are not yet completely verified or known by the Offeror at the date of publication of the Preliminary Announcement. In accordance with Article 128 of the of the Portuguese Securities Code, upon approval by CMVM, which shall be requested with a reasonable period of time, the Competing Offer may be amended or revoked, in case of unforeseen and material change in the circumstances on the which the Offeror based its decision to launch the Competing Offer in terms known to its addressees. Rights of prior offerors Under the terms of Article 185-B of the Portuguese Securities Code, the launch of this Competing Offer entitle any prior offeror to review the terms of its offer, irrespective of having already done so or not under Article 184 of the Portuguese Securities Code. If any offeror intends to exercise such right, it shall notify its decision to CMVM and publish an announcement within four business days as of the launch of this Competing Offer. Failing such publication, the terms of the offer are deemed to have been maintained. Any review of offers shall have to comply with the provisions of Article 185(5) of the Portuguese Securities Code, i.e., the consideration offered shall be, at least, 2% above of the consideration offered in the preceding offer and cannot contain conditions that make them become less favourable.. Page 33 of 60

35 The launching of a competing offer may constitute grounds for a revocation of any prior offer, provided that such revocation is immediately published in accordance article 185-B(5) of the Portuguese Securities Code. Expenses and costs to be borne by the Competing Offer addressees All costs related to sale of the Shares within the Competing Offer, including brokerage fees, commissions related to regulated market transaction, as well as taxes that fall within the taxable status of the vendor, will be borne by the Competing Offer s addressees. The above mentioned costs shall be indicated by the relevant financial intermediaries at the moment of the selling orders delivery. Financial intermediation commissions are disclosed in the CMVM s website ( Tax Regime This Section is a summary, for general information purposes, of the Portuguese personal income tax and corporate income tax regime applicable on the date hereof to the proceeds of shares ( acções ) issued by a corporation ( sociedade anónima ) resident in Portugal, including but not limited to, taxation of the capital gains obtained from their sale. The description provided hereto is a general overview of the main tax implications and may be subject of amendments, possibly with retroactive effect. This description does not exempt the Competing Offer s addressees from obtaining advice and consulting the relevant laws and regulations in this respect. No potentially applicable transitional regimes were taken into consideration, namely those applicable to certain type of investors. Tax consequences may vary according to DTT provisions or to particularities of investors. Resident individuals in Portugal Capital gains and losses in a sale of Shares The annual positive balance between capital gains and capital losses obtained from the sale of Shares (and other securities and financial assets) is subject to a special rate of 28%, without prejudice of the respective beneficiary opting for its aggregation in which case the gain will be subject to progressive rates up to 48%, increased by a solidarity rate of 2.5% and 5%, over the income tax base that exceeds 80, and 250,000.00, respectively. In the case of the option for aggregation regime ( englobamento ), on the part of the income tax ( IRS ) base that exceeds, per taxpayer, the annual value of the minimum wage, an additional 3.5% rate will be applicable. In assessing the relevant positive or negative balance, losses resulting from sales where the counterparty is subject to a more favourable tax regime in the respective country, territory or place Page 34 of 60

36 of residence, as listed in the Order no. 150/2004 of February 13 (as amended), will not be considered. Dividends obtained from owned Shares Dividends paid to an individual resident in Portugal are taxable. When they become collectable, a definitive withholding tax, currently at a rate of 28% is applicable. The beneficiary of the dividends may opt for the aggregation of the income together with the remaining taxable income obtained in that same tax year, in which case only 50% of the dividends will be considered for tax purposes, and taxed at a progressive rate up to 48% (increased by a solidarity rate of 2.5% and 5%, over the income tax base that exceeds 80, and 250,000.00, respectively). In the case of the option for aggregation regime ( englobamento ), on the part of the income tax ( IRS ) base that exceeds, per taxpayer, the annual value of the minimum wage, an additional 3.5%. rate will be applicable. In case of the aggregation regime ( englobamento ), the withheld tax is considered as a payment on account of the final tax due. When dividends are paid or made available to accounts opened for one or more beneficiaries on behalf of unidentified third parties the withholding rate is of 35% and has a definitive nature, unless the beneficial owner of the dividends is identified, in which case the general rules described above will apply. Free transfer of shares Free transfers ( inter vivos and mortis causa ) of shares are subject to Stamp tax at a 10% rate. However, free transfers in benefit of the holder s spouse or unmarried partner ( união de facto ), parents and children are exempt. Non-resident individuals in Portugal Capital gains and losses in a sale of shares Capital gains obtained from the sale of shares held by non-residents in Portugal are subject to IRS. The annual positive balance between capital gains and capital losses obtained from the sale of shares (and other securities and financial assets) is subject to a special rate of 28%. Nevertheless, an exemption is applicable to non-residents on such capital gains, except if one of the following situations occurs: (i) the counterparty is subject to a more favourable tax regime in the respective country, territory or place of residence as listed in the Order no. 150/2004, of February 13 (as amended); or (ii) capital gains arising from the sale of shares of companies which assets are composed, directly or indirectly, in more than 50% of real estate or rights in rem over real estate, in both cases located in the Portuguese territory. Generally, under the terms of the DTT to which Portugal is a signatory, Portugal is usually limited in its possibility to tax the above described capital gains. However DTT rules must be confirmed on a case by case basis. Page 35 of 60

37 Dividends obtained from owned shares Dividends are subject to IRS by means of a definitive withholding tax, currently at a rate of 28% at the time they become collectable. The above rate may be reduced under the terms of a DTT executed between Portugal and the country of residence of the taxpayer, as long as the formalities contemplated under Article 18 of Decree-Law no. 42/91, of January 22, are met. A definitive withholding tax will apply at a rate of 35% if the dividends are paid or made available: (i) (ii) in bank accounts opened for one or more holders on behalf of non-identified third parties, unless the beneficial owner of the dividends is identified, in which case the general rules apply; and to taxpayers resident in countries included in the list of tax havens approved by Order no. 150/2004, of February 13 (as amended). Free transfer of shares Free transfers ( inter vivos and mortis causa ) of shares in the benefit of individuals non-resident in Portuguese territory are not subject to Stamp tax. Resident Companies in Portugal or Non-resident entities with permanent establishment in Portugal to which capital gains resulting from the sale of shares are attributable Capital gains and losses in a sale of shares Capital gains or losses obtained on the sale of shares are subject to the progressive corporate tax ( IRC ) of 23% or of 17% for a taxable income up to 15, in the case of small and mediumsized companies, to which a municipal surcharge ( Derrama Municipal ) up to 1.5% may accrue. A national surcharge ( Derrama Estatual ) shall also accrue to these corporate taxes, at a rate of: (i) (ii) (iii) 3% for taxable profits exceeding 1.5 million and up to 7.5 million; 5% for taxable profits exceeding 7.5 million and up to 35 million; and 7% for taxable profits exceeding 35 million. The applicable rate is of 21.5% in the case of entities that benefit of exemption from tax under the provisions of Articles 9 and 10 of the Code of Corporate Tax ( Código do IRC ), which is not applicable to investment income and in the case of entities which do not develop commercial, industrial or agricultural activities. In the capital gains and losses calculation for IRC purposes, the cost of acquisition of shares which were held by period of at least two years before the date of the sale is adjusted according to a currency devaluation coefficient for the year of acquisition, as annually approved by law. In light of regime for the elimination of double taxation, if a company: (i) is not subject to the tax transparency regime; (ii) directly (or direct and indirectly) holds at least 5% of the share capital or Page 36 of 60

38 voting rights of a company; and (iii) has been the holder of such shares during a period of 24 months prior to the date of the shares sale, the capital gains and losses resulting from the sale of these shares will not be taken into consideration for the determination of the taxable income. Capital losses on the sale of shares in favour of companies with residence in a territory, country or region subject to a more favourable tax regime included in the list approved by Order no. 150/2004, of February 13, as amended, are not deductible for tax purposes. The amount of dividends distributed under the regime for the elimination of double taxation, applicable to shares in the four years prior to the date of sale is not deductible for the purposes of calculating capital losses in such sale. Dividends obtained from owned shares Dividends paid to companies resident in Portugal for tax purposes and to non-residents with a permanent establishment in Portugal to which an income is attributable, are included in the taxable income and subject to the progressive IRC of 23% or of 17% for a taxable income up to 15, in the case of small and medium-sized enterprises. These dividends may also be subject to a municipal surcharge ( Derrama Municipal ) up to 1.5%, as well as to a national surcharge ( Derrama Estadual ) in the following terms: (i) (ii) (iii) 3% for taxable profits exceeding 1.5 million and up to 7.5 million; 5% for taxable profits exceeding 7.5 million and up to 35 million; and 7% for taxable profits exceeding 35 million. A withholding tax of 25% is applicable, considered to be a payment on account of the total tax due. A definitive withholding tax is applicable at a rate of 21.5% in the case of entities that benefit of exemption from tax under the provisions of Articles 9 and 10 of the Code of Corporate Tax, which is not applicable to investment income and in the case of entities which do not develop commercial, industrial or agricultural activities. In accordance with the regime for the elimination of double taxation, if a company: (i) is not subject to the tax transparency regime; (ii) directly (or direct and indirectly) holds at least 5% of the share capital or voting rights of a company; and (iii) has been, uninterruptedly, the holder of shares over the 24 months prior to the date where the dividends have been made available for collection, or if the company remains the holder of such shares until the end of mentioned minimum period of ownership, the dividends will not be taken into consideration for the determination of the taxable income. A minimum period of one year of ownership before distribution is required for the exemption from the withholding tax to be applicable. Financial institutions, pension funds, savings plans for retirement or education plans, shares savings plans, venture capital funds and certain taxexempt entities, among other entities, are not subject to this withholding tax. An autonomous rate of 23% is applicable to dividends distributed to entities which benefit from total or partial exemption from IRC (including, in the latter case, investment income) if the shares Page 37 of 60

39 are not held by those entities for the minimum period of ownership of one year, which may be completed after dividends have been made available. A definitive withholding tax of 35% is applicable in case the dividends are paid or made available through bank accounts opened for one or more holders on behalf of non-identified third parties, unless the beneficial owner of the dividends is identified, in which case the general rules apply. Free transfer of Shares The positive variation in the income not reflected in the income results resulting from the acquisitions of shares free of charge by companies is subject to the IRC at a rate of 23% or of 17% for a taxable income up to 15, in the case of small and medium-sized enterprises and may be subject to a municipal surcharge ( Derrama Municipal ) up to 1.5%, as well as to a national surcharge ( Derrama Estadual ) in the following terms: (i) (ii) (iii) 3% for taxable profits exceeding 1.5 million and up to 7.5 million; 5% for taxable profits exceeding 7.5 million and up to 35 million; and 7% for taxable profits exceeding 35 million. The applicable rate is of 21.5% in the case of entities that benefit of exemption from tax under the provisions of Articles 9 and 10 of the Code of Corporate Tax, which is not applicable to investment income and in the case of entities which do not develop commercial, industrial or agricultural activities. Non - resident Companies Capital gains and losses in a sale of shares Capital gains obtained from the sale of shares (and other securities and financial assets) by nonresident companies which do not have a permanent establishment located in Portugal, are subject to IRC. Notwithstanding, an exemption is applicable to the taxation of capital gains, except in the case of (i) (ii) The non-resident holder being owned in more than 25%, directly or indirectly, by resident entities; The non-resident holder being resident in a country, territory or region, included in the list of tax havens approved by Order no. 150/2004, of February 13 (as amended). Generally, under the terms of the DTT to which Portugal is a signatory, Portugal is usually limited in its possibility to tax the above described capital gains. However DTT rules must be confirmed on a case by case basis. The annual positive balance between gains from not otherwise exempt from taxation and losses resulting from the sale of shares (and other assets) net of costs incurred in the sale is taxed at a rate of 25%. Page 38 of 60

40 Dividends and other income resulting from the ownership of shares Dividends are subject to corporate tax by means of definitive withholding at a rate of 25%. The above mentioned withholding tax rate may be reduced under the terms of a DTT between Portugal and the country of residence of the shareholder, provided that certain formalities established in Article 98 of the Code of Corporate Tax are fulfilled. At the request of the beneficiary, the difference between the withholding tax and the amount corresponding to the application of the general corporate tax rates may be reimbursed to residents in other Member States of the European Union or the European Economic Area (in the latter case, only if there is cooperation in tax matters as existing among European Union Member States), provided that the conditions laid down under Article 2 of Directive no. 2011/96/EU of the Council, of 30 November 2011 are verified. In this case, all income is taken into account, including the income obtained Portuguese in territory. Dividends paid to a company resident in another Member State of the European Union or the European Economic Area (in this case, only if there is cooperation in tax matters as existing among European Union Member States) or a country with which Portugal has entered into a DTT, if any, providing for administrative cooperation in tax matters equivalent to that existing in the Union European, are exempt from taxation in certain circumstances. This includes the case where the beneficiary company: (i) (ii) (iii) is subject to and not exempt from tax established in Article 2 of Directive 2011/96/EU of the Council, of 30 November 2011 (with the necessary adjustments, if applicable), or subject to a tax which is identical or similar to IRC, provided that the countries with which Portugal has entered into DTT providing for administrative cooperation in tax matters and this cooperation is equivalent to that among European Union Member States, and as long as the applicable rate is not less than 60% of the normal IRC rate; directly (or directly and indirectly) holds at least 5% capital or voting rights of a company; and uninterruptedly, holds shares over the 24 months preceding the date on which the dividends were made available. If the said period of 24 months is completed after the date of payment, the withholding tax may be refunded. For the purposes of exemption from withholding or reimbursement, a few formalities as envisaged under Article 95 of the Code of Corporate Tax, are required. A definitive withholding rate of 35% is applicable if the dividends are paid or made available: (i) (ii) in bank accounts opened for one or more holders on behalf of non-identified third parties, unless the beneficial owner of the dividends is identified, in which case the general rules apply; and to taxpayers resident in countries included in the list of tax havens approved by Order no. 150/2004, of February 13 (as amended). Page 39 of 60

41 Free transfer of Shares Any gains arising from the free acquisition of shares issued by resident entities are deemed to be obtained in Portuguese territory, being subject to corporate tax if obtained by non-resident entities, at a 25% tax rate. Generally, under the terms of the DTT to which Portugal is a signatory, Portugal is usually limited in its possibility to tax the above described capital gains. However DTT rules must be confirmed on a case by case basis Assistance Banco Finantia, S.A., a company with registered offices at Rua General Firmino Miguel, no. 5 1 st floor, Lisbon, with the registered capital fully paid up of 150,000,000.00, registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number , is the financial intermediary responsible for the Competing Offer s assistance. The Offeror and Banco Finantia entered into a service and assistance agreement regarding the preparation, registration, launching and execution of the Competing Offer pursuant to Articles 113 and 337 of the Portuguese Securities Code. Such agreement is subject to Portuguese law and contains certain obligations for both the Offeror and Banco Finantia regarding the Competing Offer, including clauses concerning to fees, expenses, notifications and operational procedures related to the Competing Offer Purposes of the acquisition Maintenance or modification of the business activity developed by the Target Company, the human resources policies and financial strategy of the Target Company The Offeror intends to maintain the business activity developed by the Target Company and by the companies that are in a control or group relationship with the same (under article 21 of the Portuguese Securities Code), maintaining the strategic line defined by the Board of Directors of the Target Company. The Offeror considers that this Competing Offer may bring synergies and added value to the Offeror s group. Description of the Target Company s activities A brief excerpt on the business strategy of the Target Company is presented below, as described in the prospectus of initial public offering and admission to trading of the Target Company, on the Business section. We are one of the largest integrated private healthcare service groups by revenues in the growing Portuguese private healthcare market. We rank first in terms of private network purchasing power coverage (64 per cent. as of December 2012) and private network population coverage (59 per cent. as of December 2012), according to our estimates based on INE statistics. We were established in 2000, and provide healthcare services through 18 facilities, comprising eight private hospitals, one hospital that we operate for the NHS under a PPP agreement, seven private outpatient clinics and two senior residences. We have a presence in northern, central Page 40 of 60

42 and south-central Portugal and, in certain regions, we own the sole private general hospital in operation. We have a significant presence in two regions of the country with the highest purchasing power (based on INE statistics): Lisbon, where we operate Hospital da Luz, Portugal s largest private hospital, and greater Oporto, where we operate Hospital da Arrábida. As of 30 September 2013, our facilities had, in total, 1,179 operational beds, and we had 8,907 staff, including 3,594 physicians (specialists and general practitioners), 1,672 nursing staff, 507 technicians, 892 other medical staff and 2,242 non-medical personnel. We operate a diversified business model, organised into three main operating segments: Private Healthcare, which represented 76.6 per cent. of the Group s Operating Revenue (prior to consolidation adjustments) for the nine months ended 30 September 2013 and includes our core acute care hospital and outpatient clinics business. This comprises eight hospital facilities of various sizes, including Portugal s largest private hospital by revenues, Hospital da Luz, and seven private outpatient clinics, which together offer a wide range of general hospital and clinical services, including ICUs, operating rooms, emergency rooms (excluding trauma), maternity units and cardiac units, as well as specialised facilities that provide inpatient and outpatient services in the areas of rehabilitation services, nuclear medicine, radiotherapy and dementia care. Public Healthcare, which represented 22.5 per cent. of the Group s Operating Revenue (prior to consolidation adjustments) for the nine months ended 30 September 2013 and is attributable to our operations at HBA, a newly built public hospital opened in January 2012 for which we provide clinical and other services under a PPP agreement with the Government. Other Businesses, which represented 0.9 per cent. of the Group s Operating Revenue (prior to consolidation adjustments) for the nine months ended 30 September 2013 and which comprises our two senior residences, aimed at individuals 65 years old and older and designed to offer an integrated residential solution for senior citizens who are independent or who need some assistance with their day-to-day activities. Our Group structure, by combining hospitals, outpatient clinics and senior residences under one umbrella, allows us to operate our facilities in a complementary and supportive manner, through patient referrals between facilities, shared know-how (both clinical and processrelated) and easy access to the facilities of some of the country s best acute-care hospitals. We believe this integrated network approach benefits patients, physicians and payers alike. We believe that our integrated healthcare service offering is one of the most comprehensive among healthcare providers in Portugal, and allows us to provide superior standards of patient care, with a particular focus on clinical excellence and patient safety. In addition to providing core medical, surgical and emergency services, we have differentiated ourselves in the Portuguese healthcare market by offering specialised and complex services, supported by highly advanced equipment in use at a number of our facilities in some cases, the only equipment of its kind in the country. We were, for example, the first in Portugal to acquire a femtosecond laser for refractive eye surgery. We were also the first in the country to acquire a Page 41 of 60

43 Da Vinci Surgical System to perform robotic surgery and are currently one of only two operators to use such equipment. Our flagship hospital, Hospital da Luz, has an Arrhythmology and Auricular Fibrillation Centre that is the only one of its kind in Portugal, with facilities allowing it to perform arrhythmology studies and angiograms through a magnetic navigation system. Hospital da Luz also has a fully digital imaging department allowing for teleradiology services and is the only private hospital in Portugal with three MRI machines. We also own three linear accelerators used for radiotherapy treatments. Our focus on technology, along with clinical excellence and customer service, has enabled us to reach high levels of patient satisfaction. In a December 2012 patient survey based on Hospital Consumer Assessment of Healthcare Providers and Systems methodology conducted by us at our top five hospitals by revenues from sales and services, we scored well above the U.S. hospital average in areas such as physician and nursing staff politeness and communication skills, with over 90 per cent. of patients at all five hospitals willing to recommend our facility to family and friends. Our management has significantly grown the Group and improved its results. Since our founding, we have grown through acquisitions, development of greenfield sites and expansion of existing facilities capacity. Our revenues have increased year-on-year for each of the past three years. Corporate Structure of Target Company Main Shareholders The chart below presents information regarding the qualified shareholders of the Target Company, communicated until 11 September 2014 (inclusive): Source: CMVM s Information Disclosure System. Page 42 of 60

44 Group Structure Below is presented ESS s main subsidiaries, joint ventures and associated companies as of 30 June 2014: Parent company: Espírito Santo Saúde SGPS, SA Subsidiaries: %held directly and indirectly Casas da Cidade Residências Sénior, SA % Clínica Parque dos Poetas, SA Oeiras % CLIRIA Hospital Privado de Aveiro, SA 90.59% Espírito Santo Saúde Serviços, ACE (1) % Espírito Santo Unidades de Saúde e de Apoio à Terceira Idade, SA % Instituto de Radiologia Dr. Idálio de Oliveira Centro de Radiologia % Médica, SA Espírito Santo Saúde Residência com Serviços Sénior, SA % Hospital da Arrábida Gaia, SA % CRB Clube Residencial da Boavista, SA % Hospital da Luz, SA Lisboa % Hospital da Luz Centro Clínico da Amadora, SA % HOSPOR Hospitais Portugueses, SA % RML Residência Medicalizada de Loures, SGPS, SA 75.00% Hospital Residencial do Mar, SA % Vila Lusitano Unidades de Saúde, SA % SGHL Sociedade Gestora do Hospital de Loures, SA % Surgicare Unidades de Saúde, SA Lisboa % GENOMED Diagnósticos de Medicina Molecular, SA 37.50% HL Sociedade Gestora do Edifício, SA 10.00% HME Gestão de Hospitalar, SA Évora 50.00% (1) Espírito Santo Saúde - Serviços, ACE, which was formed with no share capital, groups together ten of the Group s subsidiaries. The percentage indicated refers to the voting rights held. The Target Company is currently controlled by the company Espírito Santo Healthcare Investments, S.A., a Luxembourg company, which owns 51% of the Target Company s share capital and voting rights, being the remaining 49% dispersed on the regulated market. On the other hand, Espírito Santo Healthcare Investments, S.A. s shareholders are, amongst others (i) Rio Forte Investments, S.A., a Luxembourg company, which owns 55% of the share capital; and (ii) ESFG, which owns 17.74% of the share capital. Rio Forte Investments S.A. is fully owned by Espírito Santo International, S.A., a Luxembourg company. Page 43 of 60

45 Both Rio Forte Investments S.A. and ESFG applied for the controlled management proceeding (Gestion Contrôlée) before the Luxembourg Court, which applications were accepted by the Court on 29 July 2014, as per the information made available on the same day on the website The Court has designated a delegated judge to make a report to the Court in respect of the financial situation of said companies. On 29 July 2014, ESFG informed the market, through a communication published on CMVM s website ( that ESFG has been admitted to controlled management ( Gestion Contrôlée ) stating that the decision follows a Court hearing held on 28 July The Court s decision includes the appointment of a Judge to deal with the process ; and that The decision follows the Company s request to the Luxembourg Courts on 24 July The Company s move to seek Gestion Contrôlée followed its conclusion that it was unable to meet its obligations under its commercial paper programme and obligations associated with the Company s standalone debt obligations and that The Judge is expected to make her report on ESFG s case on 6 October Acquisition objectives Business strategy The growth strategy of the Offeror assumes the reinforcement of the positioning in the existential risks area, namely in health insurance and personal accidents insurance. This strategy is based on the socio-demographic trends that can be observed in Portugal, such as the accelerated ageing of the population, but also the gradual and inevitable redefinition of the State s role within this sector. In this sense, the acquisition of the Target Company fits the strategy of the Offeror and will allow for the development of its value proposition in key areas like traditional medicine, or even areas of medicine still to be explored, such as preventive or occupational medicine. In this context, the Offeror is fully aligned with the Target Company vision of being a reference player in the healthcare industry, through the excellence and innovation of the medicine practice, as stated in its initial public offer prospectus of 14 January 2014, and in the underlying operational strategies required to achieve this vision: Continuous improvement of ESS core business and the compromise with excellence of healthcare services provided; Maximization of synergies related with business segments and ESS business units; Increase in the coverage and penetration of ESS in Portugal; International expansion of ESS services. The Offeror intends to establish the required conditions for the maintenance of ESS Board of Directors strategic guidelines going forward, therefore operating ESS and its subsidiaries in line said guidelines. Page 44 of 60

46 In addition, the Offeror believes that the acquisition of ESS will allow the materialization of significant synergies. In fact, the Offeror is convinced of being able to ensure an increase in ESS production volumes, due to its leadership position in the insurance industry (Source: Instituto de Seguros de Portugal, do_portugal.htm), potentiating therefore a better use of ESS installed capacity, with the consequent increase in efficiency. Moreover, the Offeror and ESS would be in a position to launch a significantly innovative product offer in the healthcare industry, enabling the access to a new range of customers still without conditions to access the private healthcare services. In summary, there is full strategic alignment between the Offeror and ESS, and therefore no substantial changes to current ESS activity should be expected. The Offeror also believes in its capability to bring additional stability, in order for ESS to strengthen the relations with the different stakeholders, while maintaining the current configuration of market, based in the free choice of clients and insured. Strategy vis-à-vis Hospital de Loures public-private partnership The Offeror highlights its expertise in the management of public-private partnerships acquired in the past through its involvement in the management of HPP Hospital de Cascais, the Offeror being available to use such knowledge to support, when required, ESS management of the Hospital Beatriz Ângelo in Loures. The Offeror intends to comply with all undertakings assumed within the scope of the public-private partnership entered into under the public-private partnership regulation approved by the Decree- Law no. 185/2002, of 20 August, under which ESS assumes the management of Hospital Beatriz Ângelo in Loures, thus ensuring the maintenance of the highest standards of the service quality and the accomplishment of the production and efficiency levels. The acquisition of ESS by the Offeror will also guarantee the maintenance of current balance within the public-private partnerships market, since it will allow the Portuguese State to remain exposed to different management models, different service levels and the consequent future bargaining power. Infrastructure and Human Resources The Offeror considers that the current ESS infrastructures are adequate for its current activity, and therefore, no significant changes should be expected to current working conditions, nor any relocation of workers in the short term. The Offeror also recognizes the high quality of ESS Human Resources, from its management team to its clinical body, as well as all support administrative teams. The Offeror restates its recognition and expresses its wish to count on their cooperation going forward in order to materialize the above strategy. Page 45 of 60

47 Financing and international strategy The Offeror considers that its financial capacity will be a strength for the stability and continuity of ESS business, including in the medium and long term. From a financial standpoint, the Offeror intends to work together with ESS management in order to ensure the adequate financing of ESS current activity and permanent funds, including an adequate level of working capital, while ensuring the minimization of financing costs. In addition, the Offeror recognizes the expansion opportunities identified by the current management, both related with the capacity expansion of current facilities and with the international expansion of ESS. On this subject, the Offeror, in line with its new shareholding structure, has already redefined its business strategy with a view to promote the diversification of its activities both in respect of markets and geographies. With its acquisition by the Offeror, ESS will therefore benefit from enhanced conditions for the implementation and the acceleration of its diversification and internationalization plan, namely in Portuguese speaking countries, in all cases without prejudice of its full autonomy as a healthcare provider. In order to ensure the materialization of the above strategic guidelines, the Offeror will work together with ESS management to structure the access to financing for the needs underlying said plan, ensuring the well succeeded implementation of its diversification and internationalization plan. The above mentioned financing strategy encompasses a strict compliance with the existing financing arrangements, as well as with the applicable laws and regulations. The Offeror understands that the acquisition of ESS ensures the maintenance of the current configuration of the insurance market and remaining paying entities, to the extent that it will not cause a companies concentration movement increasing the market share of ESS Final remarks For all the reasons stated above, the Offeror restates its confidence in the current ESS Board of Directors and respective management team, and, in general, intends to maintain the strategic guidelines for the business of the Target Company, as defined in Section 14.2 (pages 160 and following) of the initial public offer prospectus (for consultation, please refer to its most relevant parts being transcribed below, for ease of reference: Strategic Vision Our strategic vision is to be the leading private healthcare provider in Portugal with respect to the quality of medical services provided and innovation. We aim to diagnose and treat our patients swiftly and effectively, with absolute respect for our patients individuality, and build an organisation that is able to attract, develop and retain exceptional people. Our attainment of these goals is based upon our commitment to: Page 46 of 60

48 placing patient interests first, focusing on the highest ethical and professional standards and developing long-term relationships with stakeholders based on the key values of efficiency, integrity and trust; delivering high-quality healthcare by monitoring scientific and technological advances, investing in advanced medical and surgical technology and using best management practices to deliver innovative treatments; recruiting and retaining the most highly skilled and qualified physicians, nurses and support staff, promoting their continuous professional development and ensuring they are fully committed to the organisation; and In order to achieve these goals, we seek to implement the following key strategies: (b) Continued enhancement of our core business and commitment to providing leading healthcare services We believe that we provide high-quality healthcare services across all of our facilities through a profitable and efficient business platform, with a focus on clinical excellence, making us a reference player in the Portuguese healthcare sector. We will continue to focus on enhancing the profitability and competitiveness of our existing core business segments by focusing on: developing our facilities product mix through innovation, supported by technologically advanced equipment and by experienced and dynamic clinical teams, to maintain ESS s competitive positioning; managing referral levels inside the Group, leveraging ESS s hub and spoke strategy and increasing external referrals from associated physicians and clinics to extend our facilities catchment areas; maximising our facilities capacity utilisation by increasing staff productivity levels to raise throughput and by improving internal procedures to reduce waste of resources; and improving support processes, making them more efficient and effective (e.g., revenue cycle management and supply chain management) to reduce costs and minimise working capital requirements. (b) Leverage existing synergies between the Group s business segments and facilities We believe that our size and coverage of the Portuguese market, together with our modern facilities and our use of innovative technologies, provides internal and external synergy opportunities that can be leveraged to enhance operational efficiencies. Page 47 of 60

49 We intend to further exploit our integrated healthcare services model and comprehensive facility portfolio, uniqueness of certain facilities and size to develop synergies between facilities, as well as between our business segments, through: continued centralised negotiation of agreements with payers, allowing ESS to leverage its scale and uniqueness of certain facilities against competitive pressure; continued centralised negotiation of clinical consumables, pharmaceutical products and clinical equipment supply, allowing the Group to achieve synergies from its size and care diversification; taking advantage of efficient and flexible medical equipment management between our facilities, which allows us to maximise equipment utilisation; attracting top professionals, promoting their professional development and leveraging their know-how and active involvement in management of our facilities to incentivise integration across the network; and working as a network, developing and maximising patient referral processes between facilities, sharing medical and surgical know-how as well as process optimisation, and providing access for patients to services across the facilities of the Group. (c) Expand our coverage and penetration in Portugal We intend to build on our strong track record of organic and acquisitive expansion in Portugal to further increase our capacity and enhance the geographic reach of our coverage within Portugal in the acute-care hospital sector to meet the increasing demand for private healthcare in Portugal, as well as tapping into new areas related to our core business. We intend to further our expansion plans in the following ways: (i) Development of capacity in existing facilities In certain cases, our existing hospitals are reaching high levels of capacity utilisation, and we aim to increase capacity of outpatient services as well as of inpatient services in these facilities. We have a track record of successfully implementing capacity expansions in the past; for example, at Hospital da Arrábida, which we nearly doubled in size in We are actively considering the development of capacity in our existing facilities through the expansion of Hospital da Luz and of Hospital da Luz Clínica de Oeiras, and we are currently in negotiations to acquire additional space in the Arrábida Shopping Centre in Gaia for the expansion of Hospital da Arrábida. (ii) Expansion through acquisitions and greenfield projects We have a significant track record of greenfield projects and selective successful acquisitions in the past, which have allowed the Group to develop a broad healthcare Page 48 of 60

50 network. We have a demonstrated ability to develop greenfield projects in key Portuguese cities that lack a structured and specialised private healthcare offering. The flagship facility of the Group, Hospital da Luz, was a key greenfield project that enabled the Group to become one of the country s main providers of high-quality private healthcare and raised the level of both service and technological standards in the private healthcare market. Currently, we are analysing the opportunity to further develop our presence in Oporto, in close co-operation with Hospital da Arrábida, consolidating our presence in the northern region of Portugal. We also proactively analyse acquisition opportunities in the Portuguese market that would enable us to strengthen our presence in key urban areas, thereby extending our coverage. (iii) Competing for further public market opportunities Portugal s current budgetary restrictions may create an opportunity for private operators to create value in the 6.5 billion public healthcare segment (under PPP models, concessions or management contracts), given their track record in managing healthcare facilities and the need to improve performance and profitability of public hospitals. We have entered the public market through our PPP in HBA, which was opened in We believe that we are well positioned to capture future growth from the public market due to our ability to offer high-quality healthcare services at a lower cost than public operators. Additionally, we believe that entry into the public sector offers the potential to improve our competitive position, due to economies of scale, synergies and ability to retain physicians. (iv) Developing new business areas We are committed to developing the range of services offered, and proactively analyse new business areas, in particular niche markets that are still untapped or underserved, where we have or can develop a competitive advantage. Potential new areas of services have been selected for the synergies they might generate for our core business. Currently, we are primarily focused on six areas: teleradiology, genetics, training and development of health professionals, transplantation programmes, expansion of dementia services and physician referral network development. We believe that all six represent an opportunity for new business generation while contributing to the improvement of our core business. (d) Expand our services internationally In order to leverage our expertise and experience in healthcare network development and management and to geographically diversify our business, we have been analysing potential markets for expansion over the last few years. Through a disciplined and gradual approach, we are mainly targeting expansions that involve a strong local partner, in order to reduce risk and time to market. Additionally, we intend to leverage our strong brand recognition and reputation for clinical excellence in geographic regions that share similar Page 49 of 60

51 characteristics to the Portuguese market, enabling us to apply managerial skills and experience as well as leverage our integrated network. Currently, we are analysing the development of a hospital in Luanda, Angola, in partnership with a Teixeira Duarte group company, an entity present in the Angolan market, a market where Hospital da Luz already enjoys brand recognition among the top income segments in the country due to the number of Angolans who are already clients of the hospital Admission to Trading and Maintenance of Public Company Status Upon the assessment of the Competing Offer s results, and in accordance with the market conditions, namely at the level of the Target Company and of the liquidity of the Shares after the Competing Offer Period, in case the Offeror reaches or exceeds, directly or under the terms of Article 20(1) of the Portuguese Securities Code, (i) 90% (ninety per cent) of the voting rights corresponding to the registered capital of the Target Company, and (ii) 90% (ninety per cent) of the voting rights encompassed by the Competing Offer as a consequence of the Competing Offer or of any other transactions legally allowed and relevant for the calculation of said percentage, the Offeror reserves the right to resort, within the three months subsequent to the end of the Competing Offer Period, to the squeeze-out mechanism set forth in Article 194 of the Portuguese Securities Code, which will imply the immediate exclusion from trading in a regulated market, the respecting re-admission being impaired for a period of 1 year. The Offeror, in case it does not exercise the rights referred to in the preceding paragraph, will not request, following the Competing Offer, the loss of listed company status of the Target Company under the terms of Article 27(1)(a) of the Portuguese Securities Code, in which case the Shares shall continue to be traded in the regulated market of Euronext Lisbon. The Offeror is in conditions to exercise the mentioned rights if, at date of the physical and financial settlement of the Competing Offer, the Offeror, or the entities that, are with the Offeror in one of the situations set forth in Article 20(1) of the Portuguese Securities Code, is the owner of 85,988,029 Shares (i.e. 90% of the voting rights corresponding to the share capital of the Target Company) of which 85,986,675 Shares (i.e. 90% of the voting rights covered by the Competing Offer) must be acquired within the scope of the Competing Offer, since the Offeror is attributed, directly and under the terms of Article 20(1) of the Portuguese Securities Code, with voting rights corresponding to 1,504 Shares Acceptance Declarations The Competing Offer will start from 8.30 a.m. on 29 of September of 2014 up to 3.30 p.m. on 10 of October of 2014, unless extended under the applicable laws 17. The selling orders may be received by the financial intermediaries until the term of the Competing Offer Period. 17 Competing offers should run simultaneously and be completed on the same date under the terms of Article 185 A (3) of the Portuguese Securities Code. Page 50 of 60

52 In accordance with Article 183(2) of the Portuguese Securities Code, the term of the Competing Offer Period may be extended by CMVM, either at the Offeror s request or on its own initiative, in case of revision, launching of a competing offer, or should such extension be required to protect the interests of the addressees. The holders of Shares, who wish to accept the Competing Offer, must transmit the selling orders directly to the financial intermediaries members of the regulated market Euronext Lisbon by Euronext Lisbon with which their securities accounts are opened. Pursuant to Articles 126, 185-A(6) and 133(3) of the Portuguese Securities Code, shareholders accepting the Competing Offer are entitled to revoke their acceptance statements through a written notification addressed to the financial intermediary that has received such declaration until the last day of the competing offers period. The financial intermediaries must provide Banco Finantia (responsible for the assistance to this Competing Offer) with daily information regarding the acceptance and revocation orders received, including the respective amounts, to the address corporatebanking@finantia.com. Financial intermediaries must report daily to Euronext Lisbon the orders of their clients through Central System of Public Offer Services, via Serviço de Centralização, between 8.00 am and 7.00 pm, except as regards the last day of the Competing Offer Period where the period for order transmission through the Public Offer Services will be between 8.00 am and 4.30 pm Competing Offer s Results The result of the Competing Offer will be determined in the Special Regulated Market Session (single session for the purposes of offers in competition), expected to take place on 13 of October of 2014, the first business day after the term of the Competing Offer Period, in a time to be established in the respective notice of the Special Regulated Market Session to be published by Euronext Lisbon. The Competing Offer s results shall be disclosed by Euronext Lisbon in its Official Bulletin (Boletim de Cotações da Euronext Lisbon) and shall be available in CMVM s website ( In addition, Fosun may disclose a public announcement in this respect in the Hong-Kong Stock Exchange (HKEx) s website ( If the Competing Offer is successful, the Competing Offer s physical and financial settlement will occur on the 2 nd business day after the Special Regulated Market Session, such settlement being expected to take place on 15 of October of Page 51 of 60

53 CHAPTER 3 INFORMATION REGARDING THE OFFEROR, HOLDINGS AND SHAREHOLDERS AGREEMENTS 3.1. Identification of the Offeror The Offeror is Fidelidade Companhia de Seguros, S.A., with registered offices at Largo do Calhariz, 30, Lisbon, registered at the Commercial Registry of Lisbon under the sole registration and taxpayer number and with the registered capital fully paid up of 381,150, Fidelidade is an entity legally authorized to carry out the insurance and reinsurance business both in Life and Non-Life, in the context of the following group: Fidelidade Subsidiaries carry out their activities both in insurance and non-insurance activities, but in any case in insurance related activities, namely car repairing, risk assessment, surveillance, real state. Fidelidade is ultimately controlled by Fosun International Limited, a listed company at the Hong Kong Stock Exchange, incorporated in Hong Kong, with registered offices at Room 808, ICBC Tower, 3 Garden Road, Central, Hong Kong, registered with the Companies Registry of Hong Kong under number and with an issued share capital of HK$ 17,687,332, Fosun is, in turn, controlled by Mr. Guo Guangchang Attribution / Aggregation of voting rights On the date of this Prospectus, the following persons are under a relevant relationship with the Offeror, as laid down in Article 20(1) of the Portuguese Securities Code: Page 52 of 60

54 A. Persons controlled by or under a group relationship with the Offeror for the purpose of Articles 20(1)(b) and 21 of the Portuguese Securities Code The list below contains the companies corresponding to Fidelidade Subsidiaries: Via Directa - Companhia de Seguros, S.A. ( Via Directa ) Companhia Portuguesa de Resseguros, S.A. ( CPR ) Universal Seguros, S.A. ( Universal Angola ) Garantia Companhia de Seguros de Cabo Verde, S.A. ( Garantia (Cabo Verde) ) Fidelidade - Investimentos Imobiliários, S.A. ( FISA ) Cetra - Centro Técnico de Reparação Automóvel, S.A. ( Cetra ) E.A.P.S. - Empresa de Análise, Prevenção e Segurança, S.A. ( Safemode ) GEP - Gestão de Peritagens Automóveis, S.A. ( GEP ) B. Persons controlling or in a group relationship with the Offeror for the purpose of Articles 20(1)(b) and 21 of the Portuguese Securities Code The Offeror is indirectly controlled by Fosun, which holds 80% of the shares and voting rights representative of the registered capital of the Offeror. The remaining capital and voting rights of the Offeror is held by Caixa Geral de Depósitos, S.A. Please refer to the following chart regarding the chain of control of the Offeror and Fosun: Page 53 of 60