EXCLUSIVE TALKS FOR THE ACQUISITION OF QUADRAN 21 June 2017 1
DISCLAIMER This document presents the contemplated acquisition by Direct Energie of 100% of Quadran's share capital. Certain statements contained in this document are forward-looking statements (including objectives and trends), which address our vision of the financial condition, results of operations, strategy, expected future business and financial performance of Direct Energie. These data do not represent forecasts within the meaning of European Regulation No. 809/2004. When used in this document, words such as anticipate, believe, estimate, expect, may, intend, "predict," "hope," "can," "will," "should," "is designed to," "with the intent," "potential, plan and other words of similar import are intended to identify forward-looking statements. 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Direct Energie entered in exclusive talks to acquire Quadran and to strengthen its position as the leading independent French energy player Transaction in line with the group s vertical integration strategy, generating stable regulated earnings and strong growth prospects After carve-out of international and non-core activities, Direct Energie would acquire Quadran s French activities in wind, solar, biogas and hydro power generation, representing a 363 MW portfolio as of 2016 and over 800 MWby end 2018 (gross capacities) All cash transaction at closing for an equity value of c. 303m, potential earn out of c. 113m over 2017-19 Unanimous support from the Board of Directors of Direct Energie Acquisition financing fully underwritten and 100m planned capital increase Quadran s work council will be consulted regarding the contemplated transaction, which would also be subject tocustomary regulatory clearances 3
A favorable French renewable market Significant growth potential for French renewables Renewables currently account for 19.5% of domestic consumption, of which c.2/3 are covered by hydro generation with limited growth potential The 2015 Energy Transition Law set in particular a target to increase the proportion of renewable energy in gross final energy consumption to 23% by 2020 and to 32% by 2030 RTE scenarios for French renewables (in GW) One of the best European regulatory frameworks France wind and solar assets benefit from a feed-in-tariff framework since the early 2000s France never imposed any retroactive measure on granted tariffs Tariffs are guaranteed for a 15/20 year period and adjusted periodically (inflation indexation in particular) Since 2011 for solar and 2017 for wind, tariffs are set for larger installations by tender offer processes and valid for 20 years Upcoming CfD scheme implementation will maintain earnings visibility of previous regulation 1-2 GW annual additions 24 18 1-2 GW annual additions 19 Wind onshore 9 10 5 6 14 2014 2015 2023 2014 2015 2023 4
Quadran: a major French renewable energy player 1 A high quality French renewables platform 2 Strong growth prospects from development portfolio 3 An expert player covering the whole value chain 4 A highly experienced management team 5
1 Quadran: a high quality French renewable platform Transaction perimeter Overview of assets Gross capacity (1) 2016 2017E 234 MW 363 MW Core businesses Other Wind on-shore France Wind onshore Biogas Plants / activities located in metropolitan France, French DOM- TOM Study / Development activities 113 MW 12 MW 190 MW 14 MW Hydro Transaction perimeter Biogas Wind onshore International Wind offshore Plants / activities located abroad (Morocco, Poland, Tunisia, Seychelles, Philippines, Ile Maurice) Energies Libres Hydro Total 4 MW c. 363 MW 4MW c. 570 MW One of the leading independent French renewable players with c. 570 MW of 2017E targeted gross installed capacity Note (1): figures as indicated by Quadran management, not constituting a guidance 6
2 Strong growth prospects from development portfolio Upcoming new capacities (all fully consolidated) 2017 2018 2019 and beyond Biogas 3% Hydro 1% 17% Hydro 3% Other 4% 34% c. 200 MW c. 250 MW 30% > 2,000 MW Wind 62% Of which 80 MW already commissioned Wind 80% Wind 66% EBITDA > 40m > 60m > 100m CAPEX c. 530m Installed capacity to more than double from 2016 to 2018 with 2018E gross capacity to reach over 800 MW and EBITDA over 100m by 2019 7
3 An expert player covering the whole value chain Ongoing development Advanced Development Financing Construction Generation Project identification Site studies Relationship development with landowners and local administrations Specific team dedicated to project finance and co-equity investors Technical assistance Coordination and oversight of construction companies Daily operation Maintenance of farms and plants Employees c. 100 c. 40 (incl. management) c. 10 c. 60 Beyond renewable generation capacity, Quadran would bring its expertise in project development, financing, construction and O&M 8
4 A highly experienced management team Chairman and CEO Regional directors Jean-Marc BOUCHET Chairman, future Quadran non-executive VP 20 years sector experience Founder of JMB Energie (historical mother company of Quadran) Jérôme SUDRES South Regional Director More than 20 years of sector experience Within the group since 1995 Jérôme BILLEREY CEO More than 25 years of sector experience Within the group since 1990 Technical support Bruno SAUBREMENT Operations Director 15 years sector experience Within the group since 2014 Laurent ALBUISSON Centre, West and Overseas Regional Director 20 years sector experience Joined Vergnet in 1997 Previously energy engineer at ADEME Guirec DUFOUR Construction Director 10 years sector experience Within the group in 2008 Charles LHERMITTE North-East and Poland Regional Director More than 15 years of sector experience Joined Quadran in 2010 Took part of the development of the very 1 st multimegawatt wind turbine in the East Denis LEFEBVRE Prospecting and Network Director More than 30 years of sector experience Within the group since 1994 9
A major step in accelerating Direct Energie s balanced growth strategy Direct Energie Progressive vertical integration Generation Customers Innovation & Ventures Renewables Thermal (CCGTs) Energy Supply Energy Services Wind Bayet (France) / 400 MW Marcinelle (Belgium) / 400 MW Residential Non residential (incl. local authorities) Energy efficiency, smart metering, remote control Biomass Landivisiau (France) / 400 MW Hydro At project stage construction expected H1 2018 Regulated Merchant /Retail hedging Upstream (Generation) Supply Energy services Direct Energie aiming to cover the full value chain from production to home energy services Market trend for integration between decentralized renewable assets and customers energy needs will require both customer services and renewable technologies expertise 10
Secured financing and solid proforma balance sheet Transaction structure Key financing terms & timing 303m cash payment at closing Up to 113m cash & equity earn-out over 2017-19 100% 303m acquisition price to be paid in cash at closing 113m earn-out mechanism, out of which up to 75m to be paid in newly issued Direct Energie shares Acquisition financing fully underwritten Planned launch of a 100m capital increase International assets Wind offshore Energies Libres Carve Out French Wind onshore Biogas Hydro Following employee representatives consultation, signing expected this summer and closing before year end, subject to customary regulatory approvals 11