Messer Group

Messer Group GmbH, seated in Germany, is the leading international Messer Group industrial gases company with worldwide activities, while the name Messer has been associated with A Worldwide Leader expertise in engineering and industrial in Technical and Medical Gases gases production and sales for more than 100 years. and Related Equipment Messer Group produces and delivers , , , , , , shielding gases for , specialty gases, medical gases and a large number of different gas mixtures. Just as varied as the spectrum of gases is the range of industries which profit from them as well as from the expertise of Messer’s personnel. These include steel and metal processing industries, , foodstuffs and pharmaceuticals, automotive and electronics industries, medical industry, and research and environmental technology sectors.

Messer 1 More than 60 locations in over 34 countries

America: Europe: Africa: Asia: Australia:

Peru Albania Algeria China New Zealand Austria Vietnam Belgium Bosnia-Herzegovina Bulgaria Croatia Czech Republic Denmark Estonia France Germany Hungary Italy Latvia Lithuania Macedonia Montenegro Netherlands Poland Portugal Romania Russia (Kaliningrad) Serbia Slovenia Slovakia Spain Switzerland Turkey Ukraine

Messer 2 Country Portfolio for South-Eastern Europe & Turkey

Company Air Separation Units • Complete product portfolio of industrial and medical Acetylene Production Romania gases and related Hydrogen Production equipment Hungary CO Production • High expertise for 2 metallurgical and industrial applications Slovenia Ukraine • High product availability for all gases Croatia Serbia Bulgaria

Bosnia- • 10 Air Separation Units Herzegovina • 5 Hydrogen Plants Macedonia Montenegro • 4 CO2 Plants Turkey • 11 Acetylene Plants Albania Greece • 2 Specialty Gases Plants

• Over 1.300 Employees • Nearly 200 Mio EUR turnover in 2012

Messer 3 Messer Tehnogas AD – Production and Filling Sites

Messer Tehnogas, part of Messer Group since 1997, is the leading company for production and distribution of industrial, medicinal Odžaci and specialty gases and accompanying equipment, and Pančevo cutting and welding equipment in ● Serbia. The company is the only Beograd producer of oxygen, nitrogen, argon Smederevo and hydrogen in Serbia, operating 3 Air Separation Units, as well as other gases’ production plants and Bor filling stations in , Smederevo, Bor, Pančevo, Niš, Kraljevo, Novi Sad and Odžaci, and more than 70 sales centers Niš throughout the country. Messer Tehnogas has in-house engineering, installation teams and technical service teams and over 50 tank trailers and trucks guaranteeing Bijela Podgorica its customers 24 hours/day, 365 days/year technical and logistical Petrovac coverage.

Messer 4 Serbia – ASU Smederevo, ASU Bor, ASU Niš

H2 Plant Pančevo ASU Smederevo The biggest plant of its kind in the Balkans.

ASU Bor

ASU Niš

Messer 5 Messer Tehnogas – Biggest Exporter in South-Eastern Europe

Export of Messer Tehnogas AD:

Hungary

Slovenia Romania Croatia Bosnia Serbia

Bulgaria Montenegro

Macedonia

Albania Turkey

Greece

Total value of export: EUR 7,6 mil. in 2012 (15% of total sales in 2012)

Messer 6 Messer Tehnogas – Facts and Figures

Facts & Figures

Name Messer Tehnogas AD

Employees (Dec. 2012) 356

Net Sales (2012) 49,6 Mio. €

Capital structure 82% Messer Group (since Jan. 2005) 18% Other shareholders

Messer 7 Messer Tehnogas AD – Experiences with the new Law on Energy

Starting from January 1, 2013, in accordance with the new Law on Energy, the electricity market in Serbia has been liberalized for the purpose of harmonizing local regulations with the regulations of the EU. In reality, this didn’t mean competiton in this field or the possibility to choose a supplier of electricity under most favorable conditions, it rather meant that the state public supplier of electricity EPS was able to, under the excuse of a “liberalized market” and market prices, state any price of electricity this company deems convenient.

Thus, the electricity price offered to Messer Tehnogas and other high voltage consumers by EPS was 68% higher than in the previous period.

Ekapija, business portal

Finance High Voltage Shock – Market Price of Electricity Jeopardizes the Work of Industrial Producers December 11, 2012

Messer 8 Messer Tehnogas AD – Experiences with the new Law on Energy

High voltage electricity consumers didn’t have the opportunity to choose a supplier although the market was liberalized, since only EPS was able to offer full supply at the time, while other potential suppliers were marginalized since the by-laws necessary for implementing the new Law on Energy were put into force only on December 21, 2012, leaving high voltage consumers only ten days amidst the holiday season to find an adequate supplier and conclude a supply agreement.

The deadline was postponed until January 15, but all consumers were on backup supply provided by EPS, for a price of 70 Euro.

Večernje novosti daily

Energy Shakes other Prices

January 16, 2013

Messer 9 Messer Tehnogas AD – Experiences with the new Law on Energy

From late November 2012, when the first offer was received from EPS, Messer Tehnogas together with 5 more high voltage electricity consumers sent numerous letters to the ministries of energy, finance and economy and government officials requesting a reasonable price increase in several steps, within a period of two or three years, explaining the effects such a price shock would have:

- on the Serbian economy as a whole - on future potential foreign investments - on the small remaining healthy part of the Serbian industry which produces and pays their electricity invoices in time.

Letter sent to the ministries of energy and finance and economy, together with 6 more high voltage electricity consumers, asking the government for a reasonable price increase

December 3, 2012

Messer 10 Messer Tehnogas AD – Experiences with the new Law on Energy

Meetings were organized with the ministries’ and EPS representatives and the conclusion of most of them was that they would try to find a reasonable solution with which all parties involved would be satisfied.

Messer was also engaged in communication activities and by communicating with the media, took the opportunity to inform the wider public about the extreme price increase and its effects on the entire economy and its future development.

Privredni pregled daily

Drastic Electricity Price Increase Shuts Down Companies

December 12, 2012

Messer 11 Messer Tehnogas AD – Experiences with the new Law on Energy

Privredni pregled daily B92 portal Electricity Rises almost 68 Percent Electricity Rises After All December 20, 2012 December 27, 2012

Messer 12 Messer Tehnogas AD – Experiences with the new Law on Energy

One day before the expiry of the deadline given by the Ministry of Energy and EPS for signing the supply agreement with EPS, on January 31, 2013, EPS sent a new, “revised” offer to high voltage consumers, giving a price identical to the one offered in late November 2012, whereas in the meantime, the electricity price in foreign exchanges dropped by 12 Euro per MWh. If the supply agreement wouldn’t be signed by January 31, consumers would be transferred to a backup supplier, which would again be EPS, with a price as much as 30% higher than the one from the new offer.

Ekapija portal

Instructions for Killing the Economy

February 6, 2013

Messer 13 Messer Tehnogas AD – Experiences with the new Law on Energy

Electricity prices 2013

€/MWh in Serbia for large industrial consumers

+ 16%

€/MWh in Hungary for large industrial consumers

+ 30%

€/MWh in Germany for large industrial consumers

EPS HUPX EEX

Comparison of electricity prices in Serbia offered by EPS and energy exchanges in Hungary and Germany.

Messer 14 Messer Tehnogas AD – Experiences with the new Law on Energy

Messer Tehnogas did not sign the supply agreement with EPS for such a high price valid for entire 2013, decided to change the supplier and signed a supply agreement with a Slovenian electricitiy distributor Gen-I, therefore becoming the first consumer in the country supplied by a company different from EPS.

feb.13 mar.13 apr.13 maj.13 jun.13 jul.13 avg.13 sep.13 okt.13 nov.13 dec.13

Weighted aver. purch. price/month Gen-I EPS Offer Average price for period Gen-I

Messer 15