PAI Partners

Reassessing the value chain Scaling up Our approach Reassessing the value chain Scaling up Our approach Insight into the panel discussion at How PAI helps its portfolio companies Connecting, Partnering, Transforming; Insight into the panel discussion at How PAI helps its portfolio companies Connecting, Partnering, Transforming; our last AGM in Paris. Looking at how strengthen their leadership positions our three pillars and how they our last AGM in Paris. Looking at how strengthen their leadership positions our three pillars and how they PAI businesses are investing in their through international expansion and underpin everything we do. PAI businesses are investing in their through international expansion and underpin everything we do. supply chains. strategic acquisitions. supply chains. strategic acquisitions. Connect Connect Issue three ⋅ October 2019 Issue three ⋅ October 2019 Connect

Transforming Issue three three Issue industries across ⋅ October 2019 October the globe Welcome

Welcome to the third edition of Connect, a publication that aims to provide an update on PAI during the past year, an insight into the way we do things and what makes us different, and an introduction to some of the people behind the firm and our investments. Connect 3 delves into one of our key investment themes: growth through transformation. When we invest in a company, we are very focused on its potential to expand internationally, build through strategic acquisitions or disrupt its industry. We have a long history of backing businesses that are transforming along those lines and this issue looks at some of the work we have been doing with the companies we partner with. A warm thank you to everyone who has contributed to this third issue. We hope this latest edition is a great introduction to PAI and a useful update for all those who follow the firm. Connect Contents Transform ESG Page 04 Page 10 Page 16 Page 50 Page 52 Transformation in Reassessing the The network effect Committed to ESG ESG Lab three themes value chain From the point of Cornelia Gomez The issue of plastic use, How our theme-based Insight into the panel view of World Freight reports on the misuse and disposal. approach helps discussion at our last Company’s Group CEO, continued evolution transform businesses. AGM in Paris. Vikram Singh. of our approach.

Page 20 Page 24 Page 32 Page 56 Interview with Scaling up Building global leaders PAI Community Lars Frederiksen Two different What it takes to An insight into our A view from former approaches to how transform local players foundation that looks portfolio company we help businesses into world-leading to help others in our CEO to working with strengthen their businesses. communities. private equity. leadership positions.

Page 34 Page 61 Page 62 Our people About PAI Welcome to PAI Our approach A team built on sector The history and The three pillars defining and local expertise. innovation that our approach. make us stand out in private equity.

Page 66 Page 36 Page 38 Page 40 Portfolio overview Interview with The London hub Our investors Laura Muries A comprehensive guide The growth of Who they are and how to the 20 companies in Our Head of Spain talks our London and our investor profile is our portfolio. about her twelve years international teams. becoming more global. with PAI.

Page 78 Page 42 Page 44 Page 46 Contact us Our sectors In focus Latest investments How to get in touch with The five areas where An insight from and exits our offices in Europe and PAI experts focus Asmodee. A new angle See how our portfolio has the US. their attention. to the investment game. evolved over the year: the businesses we have bought and sold.

02 Contents03 Connect Transforming industries across the globe

Over the years, PAI has been highly active in fundamentally transforming the businesses we invest in, using a theme-based approach.

05 Connect Transformation in three themes

Transformation in three themes

At our AGM in June 2019, we presented our approach to transforming businesses using three specific levers: investing in the value chain, strengthening leadership positions and disrupting traditional business models.

1 Investing in the value chain Some of our businesses will outsource parts of their supply chain, while others may look to integrate it. We help transform their value chain. We've been looking closely at how our businesses find value 2 through outsourcing Strengthening leadership positions We use our international presence parts of their supply to expand our companies' global reach chain or integrating it. and our sector expertise to support strategic acquisitions. 3 Disrupting traditional business models Some of our companies are disrupting the way their industries operate. We back their innovative business models.

06 07 Connect Transformation in three themes

We believe a core skill we have is to identify companies that break the mould in traditional industries.

Theme 1: Investing Theme 2: Strengthening Theme 3: Disrupting in the value chain leadership positions traditional business models

One area where we see a dramatic We have always been good at scaling When we conduct due diligence on our change today is the way companies are up companies through international investments, one of the words frequently increasingly willing to open and transform expansion and strategic acquisitions. mentioned is disruption. We believe a core their supply chain. For the last few years, skill we have is to identify companies that With international expansion, we acquire we've been looking closely at how our break the mould in traditional industries. country leaders and use our international businesses find value through outsourcing presence to move them to pan-European Atos Medical, for example, is a med- parts of their supply chain or integrating it. leadership. We then grow them further tech company which once followed a What is the total value of their supply to create global leaders. Increasingly, traditional model of using a distributor. chain, what capital do they allocate to we are investing in European leaders We've supported its transformation into different parts of the chain, and what is that are growing fast in the world's other a direct-to-patient model, accelerating the return on that capital? major economic zones, such as the US. patient acquisition but also delivering Companies today work in a more open Asmodee is a good case study - it started better service at a better cost. This is a environment and collaborate in a way that as a French company, but now more than significant, value-accretive disruption and was not possible ten years ago, sharing half its sales are in the US. This is also we believe this direct-to-consumer model data and assets across the supply chain the case with Refresco, moving from has the potential to transform many other to maximise the profit they can generate. European leadership to global leadership businesses in different areas. This is already the case in contract with the acquisition of Cott. A quarter Another example is B&B Hotels. In a hotel development and manufacturing, which of the sales of the companies we have industry which has completely changed was traditional in pharma and is now acquired in 2018/2019 are now in America. through the development of booking becoming the rule in the consumer sector. We will continue to leverage expansion intermediary websites, B&B has chosen Tomorrow it will expand to other areas. opportunities in the US with the help of to disrupt the disruptors. By selling For example, what do you do with your our New York office. directly to consumers instead of using go-to-market operation - do you share it, With strategic acquisitions, we use our intermediaries (75% of B&B's sales are keep it or sell it? Or do you take over more strong sector expertise to identify the disintermediated with bookings made of the value chain, and perhaps integrate best opportunities. For example, following on-site, through the B&B website, the the value your distributors are getting? various investments, we have developed B&B app or the B&B call centre), B&B is We believe that over time, the way extensive experience of airport services able to capture everything in its value companies interface with one another as part of our general business services chain. It has also developed a successful within a supply chain will change, coverage. We started in Europe with entrepreneurial model with 88% of and this change has great potential Swissport but have also owned a global its hotels run by independent owners for transforming businesses and duty-free business and are now invested and franchisees. creating value. in a world freight operation company and In both instances, we have chosen to back an airport concession catering business. disruptive business models, which have This gives us a deep understanding of how contributed to transforming not only the airports operate and, more importantly, companies but also their industries. what services create value at airports. We use this knowledge to help strengthen and transform our businesses.

08 09 Connect

Reassessing the value chain...

link by link

As change and disruption intensify across many industries, one key trend we’re seeing is the willingness of brand owners to take different views of the value chain.

10 11 Connect Reassessing the value chain

Breaking the value chain down, brand owners are increasingly assessing which elements are essential to their customer experience and value proposition, and which bring the best return on capital. Looking This fundamental shift is down to at three PAI businesses, our 2019 AGM keynote panel an honest appraisal of what’s really discussed how they found value in different parts important to our future growth. of the chain. They considered why and how they’ve taken this position, and how PAI helps.

Tendam – reviewing priorities to get to increase consumer engagement, closer to customers decrease risk in decisions and improve transaction quality in terms of margins. So Tendam is one of Europe’s leading fashion this is where we're concentrating most of retailers, with brands operating in 90 our efforts." markets globally. In recent years, the management team has put a lot of thought Another reason for keeping the skills into defining what is and isn’t core to its and science of customer engagement business. This has taken it from believing in-house at Tendam is a lack of high- it could make suits and outfits better than quality external specialists. Jaume Miquel the rest of the world to focusing solely on continues: “Everyone is learning it, and engaging with customers through loyalty since everyone is learning, we prefer to clubs. Even in 2011, the company owned be the owners of our mistakes, and not several factories, but it now outsources used as a testing ground for consultants all manufacturing. in the field.” This fundamental shift is down to an The strategy has proved very successful. honest appraisal of what’s really important Only six years ago, some saw the to Tendam’s future growth. It was a simple company’s loyalty clubs as a problem, case of identifying where the most sales not an asset: a burden of 17 million people come from, and this gave the business a to feed with promotions. But now, the fresh direction. With 50% of global sales company’s customers, and its knowledge coming through loyalty clubs – a figure of them, are clearly Tendam’s number that’s 75% in the key markets of Spain and one asset. Portugal – the need to focus on customer “PAI has been very helpful in developing satisfaction, loyalty and personalisation this strategy,” continues Jaume Miquel, was obvious. As CEO Jaume Miquel “making CRM, analytics, and consumer Naudi explains, "brand and product insights our main assets.” The numbers remain core areas, and this includes speak for themselves: four years ago, business analytics which is closely related the business had 20 million loyalty club to consumer relationships, one of our key members, identified in eight clusters. assets, so we want to do it ourselves and Today, it has around 300 clusters, and for develop a distinctive and unique expertise. each of these, it understands its ‘share of We know quite a lot about the clients in wallet’, what the customers are buying, our loyalty clubs, and we have the ability and not buying, and what opportunities to personalise more. These insights help exist to get ahead of the competition.

David Krucik (Moderator), Managing Partner, OC&C, Luis Bach, Chairman of the Board of Refresco, Gianni Zoppas, Chairman, Thelios, Jaume Miquel Naudi, CEO, Tendam

Tendam also knows what makes its aren’t easy to find – people who can group. So it plays a key role in LVMH’s customers happy or unhappy, and translate algorithms into real business. value chain, ensuring excellent quality in a can predict with 95% accuracy which But for us this is the future, and we're complex product. customers will leave its clubs the on track.” Thelios was created largely due to major following year. Of course, this is all highly changes in the luxury eyewear sector. valuable information – not just to support Thelios – enhancing brands through These included a merger between sales, but also to build gross margin. But quality products vertically integrated giant Luxottica Group there’s more work to do, as Jaume Miquel and ophthalmic optics producer Essilor, admits: “The area that's getting more A joint venture between eyewear which meant frames and lenses would go difficult is personalisation. It’s probably designer-manufacturer Marcolin and to the market together for the first time. where the biggest win will be, and we’re LVMH, Thelios produces eyewear for the Another change was luxury group Kering’s putting more effort into it. Data scientists prestigious brands belonging to the luxury announcement that it was abandoning 12 13 Connect Reassessing the value chain

It’s not just about being cheaper and having the best technology, but also about understanding the consumer.

further pressure on anyone involved in Refresco’s strategy to increase its value also its operations. Thirdly, PAI facilitates drinks packaging. The industry is a big as a partner – especially to major brand access to the top management of brands consumer of polyethylene terephthalate owners, who offer a greater potential like Coca-Cola or Pepsi, and reassures (PET), and there’s now a progressive for long-term partnerships, compared them they have a long-term partner, move to other formats, and a demand to the annually negotiated contracts because of their experience in partnering for recyclable PET, which again adds with retailers. with other brand owners.” more complexity. Luis sees PAI’s role in Refresco’s strategy Whether in fashion retail, luxury eyewear All these changes are creating volatility as threefold: “The first thing PAI provides or soft drinks, one thing these case and risk in the market, to which the big is the financial muscle we need to increase studies tell us is that rapid change in any brands are keen to reduce their exposure. in size and be more efficient, to implement industry often demands a rethink of the Outsourcing bottling is one way to do this. synergies, and to offer lower costs to our value chain. And the consequent actions customers. With PAI, we can look for Luis Bach, Chairman of the Board of can mean significant transformation for a M&A opportunities, and do the necessary the typical model of business licensing exchange some risk on the equity you have to work hard for every day. And Refresco, explains further: “For drinks business – which, to be successful, relies capex to develop the technologies to insource all its eyewear operations. of the brand with the money they were you need someone backing you, which brands, the formulation and sales of the on knowledge, expertise, financial fire our customers need. Secondly, PAI’s Thelios Chairman, Gianni Zoppas, getting in royalties and marketing is exactly what PAI has done and is still products are usually core, but not the power, and a willingness to take a longer- experience and track record in consumer describes the context: “These things expenses. But now the value of the brand doing. The future for this industry is bottling. Working with us, they have less term perspective. All of which PAI is ready goods helps us challenge our customers’ changed the name of the game, creating is much more important than the royalties. fewer brands, fewer competitors, better risky innovation – we provide access to to provide management – not only in its strategy but a different approach to the traditionally So who is the winner? It’s the ones who business. I'm sure Marcolin will be one of new bottling technologies, or innovation fragmented market, where too many are going to deliver quality – through the winners in this game.” in packaging or products, without them competitors and too many brands were vision, strategy and organisation.” having to make significant investment. making the licence-licensee model We can also reduce their costs, because Achieving this quality position with Refresco – helping drinks brands focus less attractive. Against this backdrop, our significant size provides synergies Thelios – and maintaining it in a changing on core strengths Marcolin’s JV with LVMH was an agenda in production or bottling. Plus, we can market – is where Gianni has found the setter. Through Thelios, Marcolin is now Refresco, the world’s largest independent offer a reduction in working capital by partnership with PAI particularly helpful. a partner of the biggest luxury group in drinks bottler, operates 59 manufacturing taking on their inventories. Perhaps most “Who would have ever imagined that the world.” sites in Europe and North America, where importantly, as a reliable company in Marcolin, which was the fifth or sixth it packages a huge range of products for size, diversified across Europe and North For consumers, an important benefit of company in the industry, could have set many leading retailers and branded drinks. America, we can offer them a long-term these changes in the eyewear market is up a JV with LVMH? I would say nobody. These companies outsource this key part partnership, which lets them focus the big brands’ increased concern for Even in my team. But something made of their operations for various reasons, not clearly on their key activities: product quality. As Gianni explains, “brands are Marcolin the most appealing and well- least the fast-changing consumer trends development, sales and marketing.” now very careful to protect their equity reputed company in the industry. This affecting the industry. in the market. Years ago, they would didn’t happen by chance; it’s something To maintain this position as an outsourcing One trend is an emphasis on health and partner, Refresco must keep tracking the wellness, seen in new products and market, improve its market intelligence, reformulations with fewer calories and and remain vigilant about its competitors, preservatives. Another is the emergence consumer trends, and the evolution of of new categories, such as ready-to-drink the market. As Luis says, “It’s not just So who is the winner? It’s the ones who are going coffee and tea, which requires expensive about being cheaper and having the to deliver quality – through vision, strategy production facilities and significant best bottling technology, but also about capex. Plus, there’s the growing demand understanding the consumer.” and organisation. for personalisation, again leading to new The business also needs to be more products, formats and flavours, and and more efficient. The management increasing complexity in the industry. team sees this as coming from external Also, the intensifying of consumers’ growth, which it achieves through buying environmental concerns, especially companies and production plants. regarding plastic waste, is putting Geographic expansion is another part of

14 15 The network effect

As the economic concept of the positive ‘network effect’ states, the more people participate in something, the more valuable it becomes to all of them. Apply this to a growing business, through acquisitions and integrating the supply chain, and the benefits can be considerable – as World Freight Company discovered.

16 17 Connect The network effect

World Freight Company (WFC) is the world’s largest air-cargo capacity manager. With a network of over 20 brands, it manages close to three million tonnes of capacity, and four to five million shipments a year, for Building on the impressive progress WFC team, and have already closed several has already made, PAI sees three priorities acquisitions since last year. Lastly, In the short time airline customers around the world. for future development: organic growth, in digital, we intend to transform the M&A and digital. business from very human, paper-based PAI has been on interactions to a more digitised, seamless Guillaume tells us more: “For organic model. All of this will enhance the value of board, we’ve growth, we intend to leverage our network the WFC proposition to its clients." Group CEO Vikram Singh explains how – such as our ability to rationalise cost to increase market share, accelerate made a number the company achieved this scale: “Years and leverage technology – will give us the gain of new contracts, and increase Vikram agrees: “In the short time PAI ago, we started to see that in air traffic, advantages for years to come.” the global value of WFC for each airline has been on board, we’ve made a number of very strategic passenger growth was outpacing cargo customer. For M&A, the market remains of very strategic acquisitions. We are growth. As a cargo capacity manager, we A natural fit with PAI extremely fragmented, and WFC is a currently involved in making more critical acquisitions. wanted to redress this balance, so we set natural platform for consolidation. We’ve acquisitions for our business, taking us to For PAI, the network effect on WFC made about creating a platform to consolidate reinforced the M&A capabilities of the the next level of our development.” it very appealing, but the timing had to the supply side. Through acquisitions, we be right. Guillaume Leblanc, Principal at added scale and breadth to our service PAI Partners, puts this into context: “We capabilities. Before long, we saw the so- have a very successful track record in called network effect starting to play out investments related to air traffic, such as for the brands that joined us, with them all our partnerships with Swissport, Nuance experiencing exponential growth.” and ADB Safegate. As part of this focus, Most importantly, this network effect we identified WFC as a very attractive now enables WFC to steal a march on investment opportunity some years ago its competitors. As Vikram observes, – but at the time, the company’s size put “in all the big markets, our competitors it below our investment mandate. Since tend to be local heroes. So the benefits then, we’ve been very impressed by of the scale of our international network the development of the company under Vikram Singh, Group CEO, World Freight Company the leadership of Vikram, especially in Asia. So when it came up for sale at the beginning of last year, we were keen to get involved.” That strength in Asia encouraged PAI to seek a partner in the investment, which it found in Baring Private Equity Asia. Even though our business has a French Guillaume continues: “Even though our business has a French history and French history and French roots, our future is roots, our future is very much in Asia. WFC has a significant presence in the very much in Asia. critical Europe-to-Asia corridor, and our partnership with Baring Private Equity Asia reflects that.”

Strategy for continued growth Vikram sees great opportunities ahead: “I think we have to continue to scale up. We are only at around 2.5% of global capacity today. So I think we can easily double that within a very short period of time.”

18 19 Connect

Private equity’s lasting influence on business life Reflections from Lars Frederiksen

After joining Danish bioscience group, Chr. Hansen Holding A/S, in 1980, Lars Frederiksen progressed through a series of roles before becoming CEO when PAI Partners bought the company in 2005. He continued to lead the business through a significant transformation, and an IPO on NASDAQ OMX in 2010, until 2013, when PAI sold its remaining shares. Since then, he has pursued a Board career with a variety of organisations including Atos Medical, a PAI portfolio company, and sits on PAI’s Supervisory Board. Here he describes how his experiences with PAI have influenced the way he works.

20 21 Connect Private equity’s lasting influence on business life

I liked the personal commitment PAI invests, and the ability to attach highly qualified advisers to the programme.

Is there anything about PAI’s approach across the world, and Widex, a family- Any other thoughts on private equity in particular that stands out? owned hearing aid company. Most you’d like to leave us with? recently, I’ve been elected Chairman of A few things. I was impressed by their When I look back at how corporate Atos Medical, a Swedish company owned creativity in putting together the right governance has evolved over the last ten by PAI. Among other things, it’s the world financial model – for the business, the to fifteen years – in Denmark and many leader in voice prosthesis, helping people market and the particular situation other countries – I think private equity speak again after surgery for cancer of we were in. And I liked the personal has left a big fingerprint. It’s been a major the larynx. It’s an extremely fascinating commitment PAI invests, and the ability influence in shaping how private and listed company with a very appealing mission to attach highly qualified advisers companies control and direct themselves, and strong financial development. to the programme. Also, in our case with an emphasis on active ownership. So at Chr. Hansen, PAI was extremely I’m really happy with this varied portfolio. today, mismanagement isn’t as widespread knowledgeable about our industry and the It offers me a wide range of experiences, as it used to be. And I think this is largely value drivers. A big part of our business and lets me apply my know-how in down to the growth of private equity and was developing ingredients for the food different contexts. the lessons it has taught and nutritional industries, and PAI had previously invested in another ingredients company, Diana – and in Yoplait, which was one of our customers. So there was a solid understanding of the market dynamics affecting us, which was very important, and very valuable.

Has this approach had any lasting effects on how you work now? Definitely. Today, I work and think as though I’m running a company owned by private equity. Whatever type of organisation I’m working with, I focus What do you think you’ve gained from I also learned during this time that cash on doing the right things, making sure your years with PAI? is king, especially in the difficult situations people are committed and engaged, created by the financial crisis. And I and dealing with any political agendas. Private equity is a Well, I certainly learned a lot about private learned how much you can change if you It’s about building up knowledge and equity. Before PAI came along, I really great model for solving remove politics from the agenda, and understanding, and using that to achieve didn’t know much about it – only rumours everybody focuses on doing what’s right agreed objectives – and not letting problems in a business, that weren’t always very positive. So I was for the business. anything distract you from that path. and for turning an a little sceptical, but working with PAI really changed my mind. Private equity Tell us a little more about what you’ve That’s an interesting point about politics. averagely performing is a great model for solving problems in been doing since leaving Chr. Hansen. Can you tell us more? a business, and for turning an averagely company into a As a professional Board member, I have performing company into a market leader. Yes, I think internal politics can become a number of roles. Which is exactly market leader. particularly damaging when a business It really boosts the ability to create value. what I wanted to do after Chr. Hansen has problems. A blame game often For shareholders, of course, but it can – to broaden my experience of different starts – between investors, the Board and also turn around the fundamentals of a types of ownership structures and models, management. There’s a lot of jockeying for business. With private equity, you ask and of different industries. So I’m involved position, rather than getting on with solving fundamental questions such as, in which with listed businesses, family businesses, the problems. But with private equity, business areas can we truly add value; foundation-owned organisations and the owners, Board and management which businesses should we be in; and private equity companies, in a wide range merge, so everyone’s working towards what is the right long-term ownership of of fields. one common goal, which is to create more the company? Answering big questions value. They all focus on it, because they For example, I’m Chairman of Matas A/S, like this can really transform a company all benefit from it. This alignment is a really a listed health and beauty retailer, and I – culturally as well as financially – and it strong aspect of the private equity model. sit on the Board of Tate & Lyle, a UK listed can recreate pride among employees who Everyone’s involved, everyone’s an investor, food ingredient company. I’m also working might have lost engagement and passion and everyone’s committed to success. with Falck A/S, a Danish foundation- due to bad management in the past. There’s no room for politics. owned company running ambulances

22 23 Connect

up Scaling

Another key theme for PAI is helping businesses transform through building scale, consolidating their markets and expanding geographically.

24 25 Connect Scaling up

M Group Services Case study: at a glance: 8,700 Adding value employees through targeted 100+ acquisition locations When we help strengthen a business' leadership This priority is where the potential for but specifically for airport, industrial and position through consolidation, it is important to have transformation exists. M Group Services commercial clients. Its well-established 4 a clear strategy as to how acquisitions can bolster has enjoyed good organic growth – relationships – especially with Heathrow divisions: transport, telecom, around 10% in 2018 – but acquiring – offer the potential to cross-sell to utilities and data the scale and scope of a company's services and, as a new businesses that enable the group other airports. Enhancing the group’s result, increase market share. With M Group Services, to diversify will really expand the range transport division, Antagrade Electrical of services available. specialises in rail electrification, and one of the UK and Ireland's leading infrastructure provides high margins thanks to the services companies, the potential for transformation Adding businesses, building services technical competencies required in its Businesses prior to field. Finally, KH Engineering Services We have worked closely with Jim PAI investment: through 'buy-and-build' M&A is considerable. offers mechanical and electrical solutions Arnold and his management team over covering the design, management and the last few months to accelerate and M Group Services supports essential partnership with PAI straight away: Colm O’Sullivan, Partner at PAI, explains: delivery of services for the rail and wider Morrison Utility Services fine tune our acquisition strategy, and infrastructure through four divisions: “We recognised the support PAI could “We want to continue M Group’s fantastic transport sectors. create a real M&A machine. So far, PMP Utilities transport, telecom, utilities and data. give us strategically, along with access to safety record – that’s number one. Then we’ve helped M Group Services make Putting these acquisitions together, Projects can involve anything from finance we wouldn’t have otherwise.” number two is simply to keep delivering Dyer & Butler five value-accretive acquisitions – M Group Services can now offer a greater working on road and rail networks, to for clients. And number three is to all adding complementary capabilities variety of services to a larger number of Magdalene repairing water mains or electricity Strategy for significant growth broaden and deepen the company’s client to the company. clients. We’re looking forward to seeing cables, to collecting meter readings for relationships by providing new expertise Morrison Data Services Our partnership with M Group Services how this broader platform will help utility retailers. The business employs and new skills – and therefore winning Avonline is a niche telecoms operator, is founded on three clear priorities, as transform the business in the near future, Morrison Telecom Services around 8,700 people directly, with about more share with those clients.” involved in building and installing as it moves towards its goal of becoming the same again in the supply chain, and broadband networks. It has a strong, M Group Services Plant & the leading service provider for essential operates from over 100 locations across long-standing relationship with Virgin Fleet Solutions infrastructure in the UK and Ireland. the UK and Ireland. Media, which is now a new client for M Group Services. IWJS is a leading As Jim Arnold says, “it’s all about service All of the company's different activities provider of waste-water services to delivery.” With these carefully chosen have the same basic business model. utilities, which fits neatly alongside the acquisitions – and probably more to come As CEO Jim Arnold says, “We deliver group’s clean-water services. Tomato – M Group Services will have a lot more Acquisitions since services to our clients, and we do it safely. Plant also provides waste-water services, to deliver When we provide a good service, we have PAI investment: the chance of more work.”

PAI invested in M Group Services in July Avonline 2018 – but we had been looking closely at the business for some years, as we have IWJS a lot of experience in related industries, We recognised the support PAI could give us Tomato Plant Company with investments such as Spie, a leading European provider of multi-technical strategically, along with access to finance we Antagrade Electrical contracting services. Jim Arnold and wouldn’t have otherwise. KH Engineering Services his team could see the benefits of a

26 27 Connect Opening the shutters onto international expansion

PAI has a long history of transforming local leaders into international ones. The strategy is often to consolidate the market by acquiring complementary operations outside of our companies’ core market, to increase their geographic footprint.

Didier Simon, CEO, StellaGroup

28 29 Connect Opening the shutters onto international expansion

A good example is StellaGroup who, in a short space of time, we have taken from a French leader to a European leader in the closure system and sun protection market - shutters, grilles, doors and awnings. Through one major acquisition - CRH's Shutters & Awnings division - StellaGroup has now almost doubled its revenue. And, having previously had very little international presence, it now draws about 45% of its revenues from outside France.

StellaGroup is a 50-year old industrial Diversifying services and footprint CRH S&A had, in fact, been identified outside of France”, explains Didier business in the market for roller shutters, during PAI's due diligence on StellaGroup Simon, “and this was achieved within Mathieu Paillat, Partner at PAI, worked StellaGroup's growing metallic grilles and curtains for store as one of the most attractive pan- only a few months of working together closely with StellaGroup CEO Didier protection. It designs, manufactures European players. The company is one with PAI”. Apart from almost doubling global footprint: Simon on this vision, meeting potential and distributes products for both of the largest producers of shutters, the company's revenue, the acquisition acquisition targets all across Europe, often residential and industrial buildings, using awnings and garage doors in Western diversifies the group's presence with the help of local PAI teams. As a a customer base of 10,000 professional Europe, with 2018 sales of over €200 internationally and helps it enter result, in April 2019, only four months into installers, rather than direct sales. million. It has leading positions in key attractive adjacent markets in outdoor PAI’s ownership, the company made its When PAI acquired the company in European markets such as Germany, the living. There are also €5 million to first acquisition outside of France, CRH’s January 2019, it was the clear French Netherlands, and the UK. The acquisition €8 million of identified cost synergies, Shutters & Awnings (S&A) platform, “a 1 leader with €231 million of sales, but our transforms StellaGroup in one step from with notable quick wins in rationalising milestone moment for StellaGroup, Didier country before PAI acquisition: ambition was always to help the business French leader to one of the main European purchasing, sales and administration. Simon and his team, which we are proud grow, both organically and through players in the sun protection and closure This excludes the impact of rolling to have been a part of”. France international expansion. system market. “Our dream was to grow out StellaGroup’s industry-leading operating model across the CRH assets.

European consolidation Our dream was to grow The additional geographical 5 diversification combined with outside of France and this StellaGroup’s leading market position additional countries since was achieved within only has also created a strong platform for PAI acquisition: the company to further consolidate a few months of working what is a highly fragmented European Austria together with PAI. market, with already over 50 identified Belgium target opportunities. The CRH S&A Germany acquisition is only the beginning The Netherlands of the journey and Mathieu Paillat expects that in the next few months United Kingdom the team will be able to make further progress towards “completing the StellaGroup jigsaw”. In the words of Didier Simon: "PAI has been strongly supportive, 45% providing its resources and expertise. international revenues With its help, we are moving forward in carrying on this international development of the company."

PAI has been strongly supportive, providing its resources and expertise. With its help, we are moving forward in carrying on this international development.

30 31 Building Europe may be our main focus, but that does Eight examples of PAI portfolio footprint and global expansion not mean our boundaries are limited. We are Albéa (France) Areas (Spain) Refresco (The Netherlands) Leading cosmetic packaging Global leader in the travel food and World’s largest independent soft constantly scanning international horizons. manufacturer beverage concession market drink bottler global 40 manufacturing sites in 17 countries Operations across 12 countries in Presence across 12 countries with We focus on driving growth through Increasingly, that involves international across the globe Europe, the US and Latin America 59 production sites, half of which dynamic consolidation in target expansion and cross-border roll-out in North America industries either through a buy-and- strategies beyond Europe, across the Asmodee (France) Froneri (UK) build strategy or transformational deals. Atlantic, Africa, the Middle East, Asia Leading global board, Global ice cream manufacturer World Freight Company (France) leaders These can be in Europe or anywhere and Australia. Our expertise in executing card and role-playing game with leading market position Global leader in the air cargo else in the world. cross-border acquisitions is crucial in publisher and distributor Direct presence in 20+ general sales and services agent turning local leaders into potential 20 countries addressed directly countries globally (GSSA) market A key skill of our teams is to identify global champions. across the globe 200+ offices around the world attractive markets where there is a clear Marcolin (Italy) opportunity to combine two or more Businesses that were little known outside Atos Medical (Sweden) Worldwide leader Key leading players, allowing us to deliver their own orbit can be turned into trophy Global leader for laryngectomy in luxury eyewear Company headquarters a step change in market share. assets with an appeal to a broad universe patient solutions Presence in 125+ countries Country locations of international buyers Direct presence in 20+ across the globe International expansion countries worldwide 32 33 Connect Our people

Our people At PAI we have a team of over 80 professionals, which is constantly growing. In 2018/2019, we welcomed 28 new hires from 10 different nationalities. We now have 15 nationalities represented across our eight offices. We also became the first French private equity firm to join Level 20 as we continue to invest in gender parity.

Our team structure has been They work together with central teams purposefully designed to execute its based in our two hubs (Paris and London) investment strategy, bringing a true to execute and manage transactions, both fusion of sector and local expertise. in initial platform and add-on investments. PAI combines centralised sector This enables us to operate efficiently as expertise with eight investment offices one team across geographies, applying underpinned by a strong culture of the expertise and knowledge gained collaboration and team-work. from one sector or transaction to other The country teams provide access to similar opportunities. local companies, vendors, intermediaries This also positions the firm well to and management teams, as well as use the significant transformation an understanding of cultural nuances opportunities provided by European that are often critical to unlocking and international markets transaction situations.

34 35 Connect Laura Muries Partner, Spain Team

Laura joined PAI in 2007 and became Head of the Spain Team in 2019. She has been involved in several transactions, including Grupo Cortefiel, Swissport, The Nuance Group, DomusVi, Konecta, Tendam and Areas.

Why did you join PAI, and how has your career What are your ambitions for the role, and for PAI developed since then? in Spain? Having started my career at Merrill Lynch in the My ambition is to continue building on the strong investment banking department in Madrid, I wanted reputation and track record that we have developed to be more than a financial adviser. I was looking during all these years in the Spanish market, where to develop a long-term career where I could have a PAI has got a very good image and brand. direct impact on the development of businesses. So I I also want to grow and diversify the scope of the decided to change. companies we invest in, exploring the full range of I joined PAI as an Investment Officer in Paris, where opportunities that exist in the Spanish mid-market. I really got to know the firm, and learned its culture In addition, we will continue to support our portfolio and DNA. I was pretty young at the time, and companies on buy-and-build stories and help them after a couple of years, I transferred to the Madrid expand into the region, similarly to what we have office where I was promoted to Director, and then successfully done in the past with DomusVi or to Principal. B&B Hotels, for example. And in February of this year, I became Partner and Head of PAI’s Spanish Team. How do you think Spain fits into the wider PAI team? And how do the various teams work During the last 10 years as part of the Spanish Team, together across our international network? I have been able to work more specifically on my sourcing and commercial capabilities, and build a Working day to day with the different offices strong network. and sector teams is very easy. We’re not a huge organisation, and this makes interaction easier. What do you like most about your role as We have an open dialogue across teams – I know Head of the Spain Team? everybody by name and enjoy an informal kind of communication. Spain is a market where the firm has a very positive history and reputation. PAI has always made very As one of our new generation of leaders, good investments here. But it’s different from other what’s your view of the culture at PAI? jurisdictions, in that a large portion of the deals coming to the market are primary businesses – which Since I joined the firm in 2007, the culture has means there’s a great opportunity to professionalise changed dramatically. At the time, the organisation companies and sectors, and develop very attractive was very French, and I was one of very few foreigners value-creation stories. in the Paris office. Since then, PAI has become much more international and diversified. We’ve been able So here, working with portfolio companies is not only to attract people of different nationalities – not only about execution, but also about the ability to connect at the junior level but also Principals and Partners. with people, generate trust and develop relationships. It’s very enriching. I really like that. We’ve also built some support teams, which we And what do you see as the biggest challenges? didn’t have before, such as communications, legal, and compliance. These make the day-to-day job of There are still a lot of family-owned businesses here. the business much more efficient, because we can This is good because, again, it offers value-creation really focus on the core tasks. And although I have a opportunities, but taking the shareholders and very demanding job, I really feel empowered by the management team to the next stage of development organisation to accomplish my mandate. There’s a can be very time-consuming. It can be a long journey significant entrepreneurial spirit across the firm. to convince them. Probably another challenge is that deal volume in How would you like to see the firm develop Spain is not yet as strong as in some of the more in the future? developed private equity markets. To ensure the I would like the firm to continue growing, obviously. younger generations in the team get plenty of Not only geographically, but also in terms of the experience and become proficient in deal execution, companies we invest in, making sure we explore they are also part of PAI’s wider Investment Group, the full range of mid-market opportunities that exist which allows them to be involved in transactions across our regions of activity. I think we can diversify across the firm and not just in Spain. our opportunities as we grow

36 37 Connect

The London hub 2018/2019 was a year of strong growth for our London hub. We grew the team and expanded its role, reinforcing the London office’s position as one of two central hubs in the PAI network, alongside Paris.

A total of 11 hires, across our professional functions such as Investor Relations and and support staff, joined our London Communications, but also in terms of team in 2018/2019. The team of 18 has nationalities. We now have team members now moved to new offices in St James's from nine different countries, which Square, Mayfair, and includes a six- include Australia, Denmark, France, member strong Investment Group, new Ireland, Germany, the Netherlands, South members of the UK, Capital Markets Korea, the UK and Tunisia and Investor Teams, and a Head of Communications. The London office is not only becoming diversified in terms of the different teams represented with transversal

38 39 Connect Our investors Our investors

We have developed a large and diversified investor base across our successive private equity funds, Generation7th buyout fund made up of more than 220 institutions from 27 countries. We have raised over €20 billion and currently manage assets in excess of €13 billion.

Our Investor Team has developed a – Events and roadshows well-resourced, open and transparent – Detailed quarterly reports, investor relations programme, with ESG reports and our website 220+Investors an emphasis on partnership and long-term relationships. – Updates and presentations on new deals and exits Our annual AGM in Paris is supplemented by annual Investor Days in Paris, London – Ad hoc meetings and informal and New York, backed up by a regular communication programme of communications including:

€20bnCapital raised since inception

Pension funds

Insurance companies

Sovereign wealth funds

Investment managers

Family offices/HNWI

Banks

Countries Other 4% 9% 16% 16% 21% 32 % 27 2%

Breakdown of Limited Partners in PAI Europe VII 40 41 Connect Our sectors

Business Services Food & Consumer General Industrials Healthcare Retail & Distribution Outsourcing, offshoring and the increased The Consumer industry is characterised Over the years, we have built real industry In the Healthcare Services industry, In Europe, we have supported reliance on information technologies have by its relative stability across economic knowledge and expertise in specific attractive investment opportunities retail companies by growing them led to the professionalisation of many cycles. In Europe, we have been able to industrial subsectors such as Building are driven by capacity expansion, into international leaders through business services providers and strong generate attractive investment returns Materials, Packaging or Automotive. Value consolidation amongst service providers, consolidation, investing in the consolidation opportunities as companies due to our ability to identify opportunities creation stories revolve around a number and value creation through service repositioning of brands and rejuvenating seek to build critical mass and scale by for industrial consolidation in the sector, of themes: investing in niche markets improvement in what continues to be store concepts to drive sales, assisting acquiring smaller, regional operators. as well as our strategy to reinvigorate under-exploited by competitors, pursuing a fragmented and inefficient market. in the reconfiguration and expansion of We have sought to capitalise on these underinvested brands and drive market a consolidation strategy, and re-energising In the Pharma and Medtech industries, store networks but also supporting the market trends to target attractive share through product innovation. non-core assets acquired from large we seek to identify companies that stand development of digital retail channels. companies with strong equity prospects industrial companies. to benefit from trends towards enhanced and strong consolidation opportunities. consumer choice, improved information available to patients and prevention over treatment.

Current portfolio Current portfolio Current portfolio Current portfolio Current portfolio ––Areas ––World Freight ––Asmodee ––Marcolin ––Albéa ––Atos Medical ––AS Adventure ––Euro Media Group Company ––Froneri ––Refresco ––Perstorp ––ELITechGroup ––Tendam ––M Group Services ––Labeyrie ––Roompot ––StellaGroup ––Ethypharm ––VPS Fine Foods ––Wessanen Average Enterprise Value Average Enterprise Value Average Enterprise Value Average Enterprise Value Average Enterprise Value €790m €782m €764m €637m €812m Number of buyouts Number of buyouts Number of buyouts Number of buyouts Number of buyouts 17 22 13 7 9 Our sectors Our 42 43 Connect Sector focus In focus

Asmodee

A new angle to the investment game and has grown to become one of the leading players in the sector. The business Whatever the industry, we believe one or model is based on creating deep and more of our transformative investment strong IPs within an extensive game themes can apply: building global leaders, catalogue to meet the company’s mission disrupting traditional business models, statement of 'a game for every gamer'. or focusing on the value in the supply We are excited by the company’s growth chain. Our investment in Asmodee, in the prospects, both in its historical locations consumer space, fits in some way with of Europe and North America, and its all three themes. And while most private more recent developments in Asia and equity firms venture down well-trodden Latin America. paths when looking for investment trends, with Asmodee, we have chosen to invest With sales of around €500m, Asmodee in something a little different. employs approximately 1,000 people in 13 game studios and 18 distribution units. PAI brings a strong Asmodee publishes and distributes The studios create and develop games Stéphane Carville, CEO, Asmodee Gaëlle d'Engremont, Partner, PAI Partners modern board games, mostly targeting conviction for the vision with strong universes and storytelling, adults and teenagers, that players will engage with. They then "Our strategic vision now is to be the which makes them a real business partner and strategy, which distribute and sell these, as well as games leading global board game company, not just a financial shareholder." At PAI, makes them a real published by third parties. and also to become a new and disruptive we believe our strong experience and provider to the entertainment industry." knowledge of the consumer industry business partner not just This customer engagement is one of the says Stéphane. will support Asmodee's plans to invest keys to growth. "We have a customer a financial shareholder. in understanding their key customer community whose members become the Achieving this means building on groups' behaviour and needs. But also games' best promoters," says Stéphane Asmodee’s position in the traditional we provide the access to capital to invest Carville, CEO of Asmodee. "The market gaming market, by developing some of its in accelerating the company's footprint also brings together a hugely diverse key IP into brands that can successfully in the US, the biggest market, and for set of game formats and social groups, diversify onto other platforms. And for identifying transformational acquisitions where human interaction and sharing of this purpose, the group is now organised that are performing strongly. emotions are key drivers." It's created across three platforms: Board Game, a healthy $10 billion market, which Entertainment, and Digital, with a view Gaëlle d'Engremont, Partner at PAI, is resilient to economic cycles and to positioning it as a leading content summarises the outlook: "As investors, growing in all regions, so it is a highly group. The Entertainment platform will we want to continue to support Asmodee attractive industry. encompass moving brands into film, as it consolidates this highly fragmented TV, comics and novels, while the Digital market. We believe there are still a lot From great games to amazing stories platform aims to move traditional board of opportunities for the company in its and card games onto console, mobile and core market of board games in Europe Asmodee is the only board game PC games. and in the US, and that, to seize further specialist in the sector, its major opportunities in new platforms such competitors being toy companies that "PAI is bringing different things to assist as digital and entertainment, it has have games among their products. As in the delivery of our business plan," implemented the right organisation in such, it is outperforming the market and says Stéphane, "particularly a strong early 2019." growing faster than its peers. conviction for the vision and strategy,

44 45 Latest Latest investments Areas

Sector Business Services EV at entry €1.5bn Acquired July 2019 Areas is a global leader in the travel food and beverage concession market. €1.8bn #13rd in travel catering worldwide FY 2018 revenue European leader in grilles and security shutters # 3

650,000 340m Roller shutters in Customers per year France alone Asmodee

Sector Food & Consumer EV at entry €1.2bn Acquired October 2018 Asmodee is a leading global board, card and role-playing game publisher and distributor.

Revenue by geography (FY 2018)

50+ 2m+UK 15% Countries where Healthy and sustainable Rest of the world products are Franceproducts 20% sold per day 39% distributed

5,549N. America 26% Tonnes of 3,000+ fair-trade sales Games in catalogue StellaGroup Latest investments Latest Sector General Industrials EV at entry €629m Acquired January 2019 StellaGroup is a European leader in the sun protection and closure system market.

Nearly doubled revenues with CRH S&A acquisition €1.8bn #1 FY 2018 revenue European leader in grilles and security shutters

650,000 340m Roller shutters in Customers per year France alone Wessanen

Sector Food & Consumer EV at entry €917m Acquired September 2019 Wessanen is a leading company in the European market for healthy and sustainable food with a focus on organic, vegetarian, fair trade and nutritionally beneficial products. 70% B Corp certification today, targeting full accreditation by the50+ end of the year 2m+ Countries where Healthy and sustainable products are products sold per day distributed 5,549 Tonnes of 3,000+ fair-trade sales Games in catalogue Latest exits Latest B&B Hotels

Sector Food & Consumer EV at entry €789m EV at exit €1.9bn Exit date July 2019 B&B Hotels is a leading budget & economy hotel chain in Europe, which addresses both business 41,000and leisure customers. 6More countries workstations on entry vs 12 countries on exit

+70% Sales growth under PAI ownership140 new hotels since acquisition

3 Add-ons 88% Of hotels are operated by local = 10 hotels 2x entrepreneurs and Increase in EBITDA franchisees Konecta Latestexits

Sector Business Services EV at entry €288m EV at exit €670m Exit date March 2019 Konecta is a leading international provider of Outsourced Contact Centres and Business Process Outsourcing (BPO) services. 41,000 19,000 employees at entry vs 64,000 More workstations employees at exit

Entry

Exit

= 1000 employees +70% 2x increase in EBITDA Sales growth under PAI ownership

3 Add-ons 88% Of hotels are operated by local 2x entrepreneurs and Increase in EBITDA franchisees Connect Committed to ESG Committed to ESG

Every year, PAI aims to go one step further in its approach to responsible investment. 2018/2019 proved to be the same as we continued to strengthen our internal processes, deepen our engagement with investors and portfolio companies, and stepped up our participation in industry-wide initiatives.

Our investors are increasingly concerned first French private equity firm to sponsor and more knowledgeable about ESG the organisation. issues that are likely to be material to We see ESG as a lever We have also been listening. It is the performance of our investments. essential that we understand and address to help us transform They want to understand how we are our investors’ ESG concerns as well as identifying and managing ESG risks and companies to make them upcoming trends, for example around opportunities, to create value and build diversity and inclusion, or issues such more sustainable. better businesses. as the use of plastics or cyber security. We believe we have a good story to tell. On these and others. We try to learn Since 2010, we have progressively and from others – whether in the corporate successfully integrated ESG management world, academia or non-governmental throughout our investment processes and organisations. We also aim to be we continue to push forward. transparent about where we stand as employees, avoid tax or heedlessly pollute an organisation, and where we need to Over the last 12 months, for example, we the environment face reputational impacts. improve our performance. launched a new Responsible Investment Effective ESG management reduces risk. policy in cooperation with PAI’s At PAI, we are confident that this Awareness of global ESG trends identifies Compliance Team, undertook around 20 willingness to learn, and to be open with opportunity. Combined, they optimise pre-acquisition due diligences, improved our investors and portfolio companies, will value creation. our due diligence processes with the help equip us to meet the sustainability internalisation of an online reputation challenges we all face, and help us build A catalyst for change tool, developed an ESG incident report successful, resilient businesses that procedure embedded in PAI’s internal will deliver a positive environmental As a private equity investor, PAI creates quarterly financial report and created a and social impact as well as a healthy value by ensuring that the businesses formal Climate Strategy in line with the financial return. we buy are performing better when we TCFD recommendations. sell them than when we acquired them. Building better businesses That requires change. Sometimes that We have continued to grow our dedicated change is drastic; sometimes it is subtle. ESG Team and engage with our investors First, we do so because, in today’s world, But it is always designed to make our through the launch of our 2018/2019 businesses like ours and those in which we investments better run, more efficient Cornelia Gomez, ESG Director, PAI Partners Sustainability Report and the deployment invest are judged on more than just their and more profitable. of our ESG Labs at our Investor Days financial results. We are convinced that in London and New York. We take an the ‘new normal’ is to rethink the purpose The change we seek in potential portfolio active part in industry-wide initiatives of companies and control their impact companies is rooted in our analysis and concerning climate change with the IC20, on their various stakeholders, such as understanding of the environmental of which we are a founding member, and employees, suppliers or communities. and social trends that are transforming gender diversity with Level 20, as the Companies that do not respect their economies and societies. Whether it be climate change, resource A centre for expertise portfolio. The ESG Team also serves as scarcity, health and safety or waste an internal consultant for our deal teams, Part of the value that private equity firms management, our investment teams go supporting them in a comprehensive such as PAI deliver is created by applying into every acquisition having identified the assessment of ESG factors before and lessons learned in one business to another ESG challenges and opportunities that the during the investment period. In the longer – and nowhere is this more true than Pre 1 Reporting 1+ Board 1 Sustainability Next company faces. run, it serves as a channel to consider in ESG. Acquisition Campaign Meeting Club owner and include innovation in the portfolio We see ESG as a lever to help us Our dedicated ESG Team, led by Cornelia alongside PAI’s Portfolio Performance transform companies to make them more Gomez, provides a focal point for ESG Group (PPG) • ESG screening sustainable. Fundamentally, we believe • ESG due diligence expertise. It works continually to keep that sustainable companies are stronger our deal teams abreast of developments and more profitable. in ESG issues of relevance to PAI’s 54 55 Connect ESG Lab: the plastics issue

enormous volumes of food waste, with the associated economic and carbon savings. While alternatives to plastics – such as ESG Lab: glass bottles or cardboard cartons – can appear intuitively attractive, they can often involve unfavourable trade-offs or the plastics unintended consequences. How the plastics value chain is addressing the issue The ESG Lab involved representatives issue from four parts of the plastics value chain. Two were from companies in PAI Partners’ portfolio: Perstorp, a Swedish In January 2019, PAI Partners held an ESG Lab in London to plastics producer, and Netherlands- based Refresco, the world’s largest discuss the emergence of plastic use, misuse and disposal as independent drinks bottler. A Partner an urgent societal, political and investment issue. at PAI spoke about his experience from investing in leading packaging company, France-based Albéa. The retail sector was represented by a senior consultant The emergence of the issue in 2018 pollution, triggered a surge in public in handling a material that has become with deep sector experience. They each teaches investors three things. The first is concern about the issue. This was ubiquitous throughout the global outlined some of the challenges created the speed with which ideas can capture quickly followed by policy and regulatory economy – and which, alongside its by the public and regulatory response to global attention in this connected age. initiatives around the world, and by a raft environmental impacts, confers enormous Laurent Rivoire, Head of the General Debbie Hitchen, a Director at consultancy plastics pollution, and how their parts of The second is how a seemingly of corporate commitments to reduce sustainability benefits of its own. Industrials Team at PAI, said that the Anthesis, noted that the retail sector, the value chain are responding. straightforward environmental problem – plastics use. disruption caused by the response to meanwhile, not only faces pressure from As part of its ESG Lab to discuss these in this case plastic pollution – evades easy Linda Zellner, Director of Innovation at plastics pollution is creating winners regulators to address plastic waste, but is These developments clearly pose risks issues, PAI Partners brought together 33 solutions in complex, modern economies. plastics producer Perstorp observed that and losers, with firms such as Albéa able also at the front-line of consumer concern. for investors – of investee companies participants, including investors managing And the third is the importance of avoiding the industry can respond to changing to differentiate themselves (through its Some retailers lack the purchasing power alienating customers or facing increased a total of around $3.4 trillion in assets, the ‘third rail’ of environmental impact: customer demand for plastics that are expertise in recycled materials, ability to to demand changes from their suppliers, regulatory costs – while also presenting portfolio companies and issue specialists harming photogenic sea animals. easier to recycle, but such development create products using less material, and while responding to the plastics issue opportunities for more sustainable to better understand the nature of the is time-consuming, expensive, and its innovative filling systems, for example). can complicate efforts to meet existing The broadcast in late 2017 of the BBC’s plastics producers, packaging solutions environmental problem caused by plastics risks developing polymers that may, However, there are several contradictory sustainability goals, especially around Blue Planet II series, with its harrowing providers and recyclers. They also overuse and pollution, and the associated subsequently, be unsellable if regulations objectives a packaging supplier like Albéa carbon emissions. images of the effects of marine plastics demonstrate the complexities involved investment risks and opportunities. change, for example. However, it’s not needs to manage, such as developing only about the polymer, she adds. The at the request of some FMCG clients The scale of the plastics problem design parameters of the end-product packaging that mixes plastic and We produce more plastic than any other can dictate how easily it can be recycled, carton, which looks ‘green’ to the end Figure 1 material, after steel and cement. Its and consumer demand for tailor-made consumer but is actually worse from a Global plastic production forecast1 production has grown exponentially since products can complicate recyclability. recycling standpoint. it came into common usage in the 1950s Coert Michielsen, Group Procurement and is set to grow more than five-fold by Director at Refresco, noted that his 2050, from 335 million tonnes/year in company is working to further increase 2016 to 1,800 million tonnes. tc octon n t the volume of recycled plastic in its The issue is less around the use of plastic, bottles, but limited supply is pushing but how it is disposed of. Since 1950, up prices, with recycled polyethylene tc octon n t only 7% of the plastic produced has been terephthalate (PET) now 20-30% Production of plastic is set recycled, with more than half sent to more expensive than virgin material. tc octon n t landfill or dumped in the environment. (Of In response, the company is aiming to to grow more than five-fold the rest, around 10% has been incinerated increase the collection of food-grade and 30% is still in use.) PET as a separate waste stream, to by 2050. increase availability. On the other hand, plastic is a miracle material. Its economic applications are He also noted that consumers are driving limitless. It is durable, often recyclable and a move away from plastics back to lightweight. It is the packaging material carton and glass, but that, certainly in with the lowest carbon footprint. Its use terms of carbon emissions, the latter is as a low-cost barrier material prevents less sustainable.

1 Sources: Plastic Europe The Facts 2017, Ryan, « A Brief History of Marine Litter Research », in M/ Bergmann, L. Gutow, M. Klages (Eds.), Marine Anthropogenic Litter, Berlin Springer 56 57 Connect ESG Lab: the plastics issue

Responding to plastics pollution Investors collaborate Workshop participants were asked to Investors, too, see a need to respond consider how companies in the various to the issue, and a group of 29 of them, parts of the value chain might respond managing around $6 trillion in assets, to issues around plastics pollution. Three have joined the plastics investor working consistent themes emerged: group convened by the Principles for Responsible Investment (PRI). The working - A whole value-chain approach – group is described by its Manager at companies throughout the value chain the PRI, Gemma James, as “a space for need to understand the composition, investors to learn, and to explore difficult use and recyclability of the plastics they questions around plastics”. Its initial work produce or consume, and work with their is focused on understanding the plastics suppliers, customers and recyclers. landscape and drawing up resources - The need to educate customers to help investors engage with investee – companies need to ensure their companies on the topic. customers, including packaging firms, FMCG companies, retailers and The investment opportunity the end-consumer, understand why This type of engagement is, typically, certain plastics are used, the cost and focused on managing risk from emerging sustainability trade-offs involved, and ESG issues. But workshop participants how to reuse or recycle them. were also asked to suggest what - The need to lobby government and investment opportunities might be regulators based on the facts – companies presented by efforts to tackle the plastic in the plastics value chain have a problem. Some suggested specific responsibility to help guide emerging investment ideas, such as companies policy, to ensure that regulations are offering packaging-as-a-service, that evidence-based, effective and do not lead could ensure the circular reuse of to unintended consequences. plastic containers.

Others proposed broader themes, such on the planet’s resources. The adoption In his concluding comments, moderator Figure 2 as initiatives to incentivise consumers to of circular economy principles – where Mike Tyrrell, Editor of SRI-Connect, How plastics are disposed leading to 3 main sources return plastics (whether used in packaging waste streams are transformed into inputs summed up the debate around plastics as of plastics pollution2 or the products themselves) in exchange – will be essential both to reduce the “alive … The investment debate around for discounts. Some participants volume of plastics that end up polluting plastics and sustainability is alive … And suggested looking for specific the natural environment, and to meet this sustainability issue belongs right at characteristics in investee companies, spiralling demand for the raw materials the heart of the investment debate.” such as an openness to a discussion from which plastics are made. around plastics and other ESG issues. 10 Mt/y One noted that, despite current concern Mismanaged plastic waste around plastics, the sector as a whole 2000 Mt remains attractive, given forecast growth Still being used 4900 Mt 1,5 Mt/y rates and the case that can be made for its Land lled or rejected positive environmental impact. in the environment Primary microplastics Nonetheless, the workshop heard that The adoption of circular economy principles will be Mt Mt business as usual is clearly not an option. 800 600 0,5 Mt/y The combined effects of a growing essential to reduce the volume of plastics pollution Incinerated Recycled Loss of shing equipment global population and the growth of and to meet spiralling demand for raw materials. consumerism as poorer parts of the world develop will place ever greater strains

2 Sources: Roland Geyer, Jenna R. Jambeck and Kara Lavender, Law in Science Advances 58 59 Connect PAI Community PAI Community

We established our foundation, PAI Community, in 2012. Its aim is to invest in and support projects that will leave a lasting legacy by creating employment and economic activity, and to promote social inclusion for people at the fringes of society. In 2019, PAI launched 'Drawings for the Community', a fundraising initiative in which emerging artists were commissioned to produce bespoke The people we are able to help may be We also aim to make the most of Emmaüs Défi - promotes the social drawings inspired by the missions of our suffering from extreme poverty, social our investment portfolio, which is a reintegration of homeless people by foundation, PAI Community. exclusion, mental illness, or may just be unique asset. It has excellent companies giving them access to jobs appropriate For this first edition of Drawings for the from tough neighbourhoods. The common with ambitious ESG goals. We can to their situation. Community, all the money raised went feature is, they are out of work. We work with them to set up joint social Fleurs de Cocagne - an organic directly to support Studienkompass, a provide funds for associations that offer ventures, helping them accelerate their horticultural farm selling flowers, German charity making young adults guidance and a framework to help people ESG strategies. employing primarily women in need of from non-academic backgrounds aware along the path towards a job. It’s hard We’re also looking to involve our investors. social and professional integration. of their educational opportunities. In line work for these associations, but it’s life- As far as the longer term goes, this is one with the charity’s purpose, the selected changing for the people they help. Fundacion Konecta - provides investment we will never exit. artists were asked to take inspiration from professional and social reintegration the following quote by American writer Providing time as well as money for disabled people and people at risk Here are some examples of projects Sydney Harris: of social exclusion in Madrid. This philanthropic initiative is based on the we support: "The whole purpose of education is to turn power of work. Employment and social Lazare - renovates and rents Adie - micro-financing to help young mirrors into windows". entrepreneurship lead to social inclusion accommodation where homeless people people develop their own entrepreneurial (also known as insertion in French), and and young adults can live together. One of the drawings, from British projects. reintegration into society. PAI Community artist Liam Cobb, was selected by PAI PerMicroLab Onlus - promotes contributes more than money though. APCDS - offers gardening and house- employees to be printed in larger scale microcredit in Italy, supporting access Our team gets involved through pro bono keeping from a kiosk manned by people using a traditional lithographic technique. to financing for socially disadvantaged work, which we encourage, taking time who are excluded from the job market. It was then exhibited, along with the other groups. from their working week to help projects artworks, at the French Embassy in Berlin Arès - helping the long-term unemployed with advice and encouragement in areas SNC - provides jobseekers with advice in February 2019 and at our AGM back into work through its own companies. such as budgeting and reporting, and and guidance. in June 2019. improved fundraising. Aurore - an organic farm that provides Studienkompass - student support professional rehabilitation through programme which offers young How are we doing? growing and selling vegetables, plus people intensive study and career garden and park maintenance. Our team of around 20 people do an orientation help. amazing job through PAI Community, Beam - world’s first online platform to by selecting, monitoring and supporting crowdfund employment training for pro bono each of the associations we disadvantaged people. back. Since inception, we’ve invested BGE - a nationwide network that helps more than €3 million in 25 projects across entrepreneurs create and develop five countries. We’re proud to report that activities that promote responsibility for each year we help hundreds of people get those involved. Our team gets involved a permanent job thanks to the projects we’ve backed. Clubhouse - a 350m² space open daily through pro bono work, Founded in 2008, Studienkompass to people with mental health issues, is the largest private student support What does the future hold? which we encourage, offering the chance to get involved in programme in Germany. It helps Now, we’re looking to involve more social and professional environments. taking time from their young students from non-academic and more people within PAI, in all the backgrounds reach their full potential. Emmaüs Connect - develops initiatives working week to countries where we operate - the common Led by the Foundation of German that transform telecommunication goal brings our diverse teams together. help projects. Business under the auspices of the tools into an opportunity to accelerate Federal Minister of Education and social inclusion. Research Anja Karliczek, the programme has over 1,300 current participants and more than 2,400 alumni

60 61 About PAI Connect Welcome to PAI €20bn+ Capital raised to date Welcome €13bn+ to PAI Assets under management We are one of Europe’s oldest and most experienced private equity firms, with more than 100 years of successful investing.

PAI’s story dates back to 1872 and the Behind this strategy is a team of over original investment business of Paribas. 80 experienced professionals, including 7th PAI in its current form can trace its a 16-strong Partner group with an average Generation buyout fund roots to 1993 when it started to focus on tenure of 16 years with the firm. leveraged buyouts, followed in 2001 by This experience is reflected a management buyout of the business. in our strong track record Our distinctive investment approach of delivering outperformance: is characterised by: – €11.5 billion invested in 71 buyout – Transformational investment strategy transactions in Europe since 1994 creating market leaders through – 52 of 71 investments fully 69,000 consolidation and strategic partnerships or partially realised Portfolio company employees – Experience and well-resourced team – €18.7 billion of proceeds returned structured to deliver strategy – 2.4x multiple of costs (MoC) – Consistent long-term performance – 27.8% gross IRR generated with an outstanding record of cash on realised investments returns and very low loss ratio. – 38% of PAI’s realised buyout investments have generated Our network gives us unparalleled more than 3x MoC and 85% have access to transactions in our core generated more than 2x MoC. markets, while also enabling a proactive 80+ approach to investment opportunities Increasing the profitability and long- Experienced professionals across Europe and beyond. term strategic value of our businesses is a central goal, but we understand that We harness our deep industry environmental, social and governance connections to take an ambitious and truly (ESG) issues also play an important transformative approach in every aspect role in securing superior values of our investments including consolidation, market position, growth, product and service development. This gives us clear competitive advantages including access to preferred deal flow, a history 220+ of strategic partnerships and expertise in Investors consolidation in fragmented markets.

64 65 Connect g Our approach n

Connecting As one of the most established private equity firms in Europe, we have built up a highly influential network of connections in our markets. Our local knowledge and sector expertise give our investors and management teams a powerful advantage and one that m is strengthened by our global footprint. Partnering Our investment strategy is founded on strong long-term relationships with investors and management teams. We create genuine partnerships built on trust and transparency ng to make sure our interests and performance incentives are aligned so that we can create better businesses. Transforming

We have an extraordinary combined ng knowledge and experience which means we achieve maximum impact when we transform companies. Our hands-on approach allows us er to identify European companies and markets nsfor with international growth potential, creating significant strategic value for the future. n a t r Tr a P

66 Connect Connect Connected intelligence Connected intelligence

We are one of the oldest and most experienced Case study private equity firms in Europe. Our team of over With B&B Hotels, we used 80 highly experienced investment professionals our sector experience and works out of offices in Paris, London, Luxembourg, local expertise to accelerate the international expansion of Madrid, Milan, Munich, Stockholm, and New York. the business, while leveraging a disruptive business model focused on disintermediation Alongside our local presence, we have One of the reasons we see so many and entrepreneurship. long-standing expertise in five key sectors: exciting prospects is that many of the Business Services; Food & Consumer; markets where these companies operate In three years, the General Industrials; Healthcare and are fragmented, divided by language, business grew from a strong Retail & Distribution. culture and political boundaries. local player to an integrated pan- European hotel platform: six new Our unique model combines local There is also a high proportion of family- countries (including Brazil), 140 and sector knowledge across the owned businesses and often a single hotel openings, add-ons in Spain business through: firm may dominate a sub-sector or a and Germany, and a strengthened geographic area, providing a platform – Sector Teams: management team. for acquisitions and consolidation in looking for opportunities and analysis markets ripe for change. The exceptional performance of – Country Teams: B&B as the fastest growing hotel Our European network, built up over providing deep local access chain in Europe sparked strong many decades, is difficult to replicate. interest from potential buyers, – Investment Group: It is the key to establishing connections leading to the sale of the business due diligence and deal structure with families and companies that give to Goldman Sachs in July 2019. us access to acquisition targets and the – Portfolio Performance Group: ability to forge strategic partnerships. optimising business performance. These relationships are often developed It allows us to see investment prospects over many years, but they allow us at an early stage and gives us the ability to to move quickly when we see the look for wider consolidation opportunities. right opportunities. The collaboration between our These relationships are often built Country Teams and Sector Teams up over many years, but they allow enables us to build relationships with us to move quickly when we see the vendors, intermediaries and management right opportunities. teams, using our understanding of the We create a gap between our portfolio Our European network, cultural nuances that can be critical to businesses and their competitors so that unlocking transactions. built up over many when we come to look for an exit they Although our roots are in France, our demand a premium price that reflects decades, is difficult web of offices allows our reach to extend their re-rating and increased scale to replicate. It is the across the whole of Europe and beyond. and benefits us, the businesses and our investors. key to establishing Europe is an attractive market, the largest economic region in the world By taking local market leaders and connections with offering a stable outlook and good turning them into national champions families and companies growth prospects. we can build European players and use them as a springboard to create world- that give us access There are 45,000 businesses in the PAI beating businesses target range size and the mid-market to acquisition targets sector of companies with €100 million and the ability to forge to €1.2 billion of revenues is three times larger than that of the US. strategic partnerships.

68 69 Connect Portfolio overview Portfolio overview AlbAlbééaa AreasAreas ASAS AdventureAdventure AsAs modeemodee AtosAtos MedicalMedical ELITechGELITechG rouproup EthypharmEthypharm EuroEuro MediaMedia GG rouproup FroneriFroneri LabeyrieLabeyrie FineFine FoFo odsods MM GroupGroup ServicesServices MarcoliMarcoli nn PerstorpPerstorp RefrescoRefresco RoompotRoompot StellaGroupStellaGroup TendamTendam VPSVPS WorWor

ldld70 FreightFreight CompanyCompany WessanenWessanen71 Connect Portfolio overview

Sector Sector Albéa General Industrials AS Adventure Retail & Distribution

Headquarters Fund Headquarters Fund France PAI Europe VI Belgium PAI Europe VI

$1.6bn transaction value 100% ownership News €393m transaction value 100% ownership News Albéa is a leading global packaging company producing a wide range of 2019 AS Adventure is the leading multi-brand retailer of outdoor clothing 2019 solutions for make-up, fragrance, skincare, personal and oral care markets. Acquisition of two companies and equipment in Europe. Received 'Top Employer for the Beauty Solutions division Belgium' certificate for the in North America and Europe. second year in a row. Investment in Erpro, a 3D printing JV with Chanel.

Sector Sector Areas Business Services Asmodee Food & Consumer

Headquarters Fund Headquarters Fund Spain PAI Europe VII France PAI Europe VII

€1.5bn transaction value 100% ownership News €1.2bn transaction value 100% ownership News Areas is a global leader in the travel food and beverage concession market. 2019 Asmodee is a leading global board, card and role-playing game publisher 2018/2019 Closing of acquisition and distributor. Since PAI investment, completed by PAI Partners. seven acquisitions across Asia, Europe, North America and Latin America.

72 73 Connect Portfolio overview

Sector Sector Atos Medical Healthcare Ethypharm Healthcare

Headquarters Fund Headquarters Fund Sweden PAI Europe VI France PAI Europe VI

SEK 7.7bn transaction value 100% ownership News €725m transaction value 100% ownership News Atos Medical is the world leading provider of laryngectomy products. 2019 Ethypharm is a specialty pharmaceutical company active in the central April 2019 Appointment of Britt Meelby nervous system and critical care areas with leading positions in pain and Acquisition of the Pharmy II Jensen as new CEO and Egil addiction treatments. laboratory, which specialises in Mølsted Madsen as new CFO. the treatment of pain.

Sector Sector ELITechGroup Healthcare Euro Media Group Business Services

Headquarters Fund Headquarters Fund Italy PAI Europe VI France PAI Europe VI

€355m transaction value 100% ownership News €170m transaction value 60% ownership News ELITechGroup is a global leader in specific niches of the in-vitro June 2019 EMG is the leader in the European audiovisual technical services market. 2019 diagnostics market. ELITech Group listed as one Acquisitions of Telegenic and of the most important Italian Global Production, two major companies in the IVD & players in the European and, Medical Device sector, by the respectively, UK and Italian newspaper Il Sole 24 ORE. Outside broadcasting markets.

74 75 Connect Portfolio overview

Sector Sector Froneri Food & M Group Services Business Services Consumer

Headquarters Fund Headquarters Fund United Kingdom PAI Europe V United Kingdom PAI Europe VI

€3bn transaction value 50% ownership News £512m transaction value 100% ownership News Froneri is a leading global ice cream player, and the result of a joint-venture 2019 M Group Services is one of the UK & Ireland’s leading infrastructure 2019 between R&R ice cream owned by PAI Partners and the Ice Cream division Acquisitions of ice-cream services companies. Acquisitions of IWJS, Tomato of Nestlé. businesses Tip Top in Plant Company, Avonline New-Zealand and Noga Networks, Antagrade Electrical in Israel. and KH Engineering Services.

Sector Sector Labeyrie Fine Foods Food & Marcolin Food & Consumer Consumer

Headquarters Fund Headquarters Fund France PAI Europe VI Italy PAI Europe V

€567m transaction value 50% ownership News €282m transaction value 72% ownership News Labeyrie is a leading European gourmet food company. 2018 Marcolin is a world leader in the branded eyewear sector. 2019 Labeyrie’s JV Aqualande Licensing agreements acquired Piszolla, generating with Adidas and Max Mara c.€30m of sales. Labeyrie (Sportmax). Renewal with also acquired Alain Francois, Harley Davidson. Distribution generating c. €16 million of sales. agreement with Barton Perreira.

76 77 Connect Portfolio overview

Sector Sector Perstorp General Industrials Roompot Food & Consumer

Headquarters Fund Headquarters Fund Sweden Stensmolla The Netherlands PAI Europe VI

SEK 9.2bn transaction value 100% ownership News €503m transaction value 100% ownership News Perstorp is a world leader in the production of specialty chemical additives September 2018 Roompot is a leading owner, operator and developer of holiday parks 2019 notably for the coatings and resin industries. Perstorp transferred from the in the Benelux and Germany. Roompot named most popular PAI Europe IV fund to a new travel organization in The fund managed by PAI Partners. Netherlands by Zoover. Head office in The Netherlands moved from Kamperland to Goes.

Sector Sector Refresco Food & StellaGroup General Industrials Consumer

Headquarters Fund Headquarters Fund The Netherlands PAI Europe VI France PAI Europe VII

€3.4bn transaction value 100% ownership News €629m transaction value 70% ownership News Refresco is the world’s largest independent bottler of beverages for retailers February 2019 Stella is a European leader in the sun protection and closure system market. May 2019 and A-brands. Acquisition of Cott's concentrate Transformational acquisition manufacturing business, which of CRH’s Shutters & Awnings follows Refresco's acquisition platform positioning StellaGroup of Cott's bottling business one as a European leader. year ago.

78 79 Connect Portfolio overview

Sector Sector Tendam Retail & Distribution Wessanen Food & Consumer

Headquarters Fund Headquarters Fund Spain PAI Europe VI The Netherlands PAI Europe VII

€1.1bn transaction value 50% ownership News €917m transaction value 61% ownership News Tendam is a leading European apparel retailer. 2019 Wessanen is a leading company in the European market for healthy September 2019 Further expansion into Mexico: and sustainable food with a focus on organic, vegetarian, fair trade Closing of acquisition by launch of new Springfield shop, and nutritionally beneficial products. PAI Partners. opening of first Fifty store and acquisition of five existing Springfield franchises.

Sector Sector VPS Business Services World Freight Company Business Services

Headquarters Fund Headquarters Fund United Kingdom PAI Europe VI France PAI Europe VI

£161m transaction value 100% ownership News €630m transaction value 50% ownership News VPS is the leader in the European vacant property services market. December 2018 WFC is a global leader in the air cargo general sales and services 2018/2019 Appointment of Gerry Loftus agent (GSSA) market. Since PAI investment, as non-executive Chairman. completed five acquisitions covering India, Central America, Western Europe, Latin America and China.

80 81 Connect

London Luxembourg Milan Madrid Munich New York Paris Stockholm PAI Partners PAI Partners PAI Partners PAI Partners PAI Partners PAI Partners PAI Partners PAI Partners 12 St James’s Square 43-45 Allée Scheffer Via Brera, 3 Velázquez, 41 Lenbachplatz 5 1325 Av. of the Americas 232 rue de Rivoli Kungsträdgårdsgatan 12, 3 tr London, SW1Y 4LB L-2520 Luxembourg 20121 Milan 28001 Madrid 80331 Munich New York, NY 10019 75001 Paris 111 47 Stockholm United Kingdom Luxembourg Italy Spain Germany United States France Sweden T +44 207 297 4660 T +352 26 26 97 71 78 T +39 02 85 45 151 T +34 91 590 22 50 T +49 89 5151 4650 T +1 212 887 1690 T +33 1 43 16 63 00 T +46 8 440 57 90

82 83 Connect

A huge thank you to all those featured namely David Krucik, Luis Bach, Gianni Zopas, Jaume Miquel Naudi, Vikram Singh, Lars Fredriksen, Jim Arnold, Didier Simon, Stéphane Carville, Linda Zellner, Coert Michielsen, Debbie Hitchen, Gemma James, Mike Tyrrell and the entire PAI team.

Photographic credits Jérémie Croidieu Virginie Ribault Christopher Scholey

Design by www.purpose.co.uk

Important disclaimer

ADDRESSEE ONLY: This document (the who are bound by substantially equivalent duties will be met. Any changes to assumptions that No PAI Party shall have any liability (including in "Document") is issued by PAI Partners SAS and/ of confidentiality as apply to the recipient of were applied in making the projections could have negligence) to any recipient of this Document or PAI Partners S.à r.l. (respectively and together this Document. Upon receipt of the Document, a material impact on these projections. The IRR or any other person for any direct, indirect or ("PAI")) and provided on a strictly confidential each recipient is deemed to have agreed that figures presented on a gross basis do not take consequential losses, damages, costs or expenses basis for the sole purpose of providing information the contents of this Document (A) constitute account of fund level expenses, PAI management arising out of or in connection with the use of or on PAI and the fund(s) managed and/or advised proprietary and confidential information that PAI fees, priority profit share, carried interest and reliance on this Document or any errors therein or by PAI (the “Fund(s)”) to a limited number of derives economic value from not being generally taxes borne by investors, which in aggregate omissions therefrom. sophisticated investors (subject to applicable known and (B) are the subject of reasonable may be substantial. Past performance is not restrictions in each relevant jurisdictions endeavours to maintain their secrecy. The necessarily indicative of future results and there including marketing ones). The Funds are open to contents of this Document are a trade secret, the can be no assurance that comparable results RELIANCE: This Document does not purport Professional Investors only. Prospective investors disclosure of which is likely to cause substantial will be achieved. Certain information contained to contain all of the information that may be shall ensure that they meet the necessary and irreparable competitive harm to PAI. in this Document constitutes “forward-looking required to evaluate a potential investment requirements before considering an investment statements,” which can be identified by the use of in the Fund and any recipient hereof should in the Funds. forward-looking terminology such as “may,” “will,” conduct its own independent analysis of the data NO OFFER: This Document is for information “should,” “expect,” “anticipate,” “target,” “project,” contained or referred to herein and must rely on purposes only. This Document is not intended “estimate,” “intend,” “continue” or “believe”, or their own examination of the legal, tax, financial OTHER RESTRICTIONS: This Document is issued to form the basis of a decision in relation to the and other consequences of an investment in by PAI only to and/or is directed only at persons purchase of any interests or in relation to any the negative thereof or other variations thereon or the Fund, including the merits of investing and who are permitted to receive it under the rules other investment decision and does not constitute comparable terminology. Due to various risks and the risks involved. Recipients of this Document and regulations applicable where such persons an offer of, or invitation or recommendation in uncertainties, actual events, results or the actual acknowledge and agree that they should are located. In France, these are persons that relation to, the sale or purchase such interests performance of any Fund may differ materially determine for themselves what reliance (if any) are Professional Investors, as this term is defined whether in relation to the Funds or otherwise. from those reflected or contemplated in such they should place on any Information and the by the applicable French law. In Luxembourg, A private offering of interests in any Fund forward looking statements. opinions contained in this presentation. Recipients these are professional investors as defined in will only be made pursuant to the applicable are strongly invited to conduct their own due Luxembourg laws. In the United States, these Fund’s offering memorandum, subscription An investment in any Fund will involve significant diligence and consult with their own professional are persons that are Accredited Investors and and governing documents (collectively, the risks, including potential loss of the entire advisors as to the Document and generally before Qualified Purchasers (pursuant to the article 3(c) “Governing Documents”), which will be furnished investment. Interests in the Fund are not liquid considering any investment in a Fund. (7) under the US Investment Company Act of to prospective investors on a confidential and are subject to transfer restrictions. Before 1940 and only where relevant), as those terms basis at their request for their consideration deciding to invest in any Fund, prospective DATA PROTECTION: PAI values privacy and are defined by the applicable U.S. law. Other in connection with such offering and which investors should pay particular attention to the is in conformity with the EU General Data requirements will apply in other jurisdictions. will contain additional information about the risk factors contained in the relevant Governing Protection Regulation. PAI invites all concerned investment objective, terms and conditions of an Documents. Investors should also have the parties to visit https://www.paipartners.com/ Accordingly, this Document may not be used in investment in the Fund and also tax information, financial ability and willingness to accept the risks privacy-policy/ to inform themselves of PAI’s data any jurisdiction except under circumstances that information regarding conflicts of interest and risk attached to the corresponding Fund, until the end protection policy and other important information will result in compliance with any applicable laws disclosures that are important to any investment of the extended Fund’s term. about the processing of Personal Data by PAI. and regulations. Recipients of this Document decision regarding the Fund. The information should inform themselves about and observe contained herein will be superseded by, and Except where otherwise indicated is qualified in its entirety by reference to, the ACCURACY: ABOUT PAI: PAI Partners SAS is a French portfolio any such restrictions. Any failure to comply with Governing Documents. in this Document, the information provided is management company (société de gestion de these restrictions may constitute a violation of based on matters as they exist as of the date portefeuille) and alternative investment fund applicable securities law. of preparation and not as of any future date, is manager approved and regulated by the French NO ADVICE FROM PAI. Without prejudice to subject to change, and will not be updated or Autorité des Marchés Financiers (https://amf- This Document has not been approved by the the generality of the foregoing, PAI does not otherwise revised to reflect information that france.org) since 22/12/2006 under the number French AMF, the Luxembourg CSSF, the U.S. provide any investment recommendation or subsequently becomes available or circumstances GP-06000052 and having its registered office Securities and Exchange Commission, the other investment service to the Recipient. This existing or changes occurring after the date at 232, rue de Rivoli, 75054 Paris Cedex 01. PAI U.S. Financial Industry Regulatory Authority Document is not, and must not be treated as, here of. The Information has not been audited Partners S.à r.l. is a Luxembourg alternative or any other regulatory authority or securities legal, tax or investment advice, investment or verified by any third party and is subject to investment fund manager approved and regulated commission in the United States or elsewhere. recommendations, or investment research. change at any time, without notice. Certain by the Luxembourg Commission de Surveillance Recipients of this Document must not take (or information contained herein was based on du Secteur Financier (https://www.cssf.lu/) refrain from taking) any investment decision on the or obtained or derived from data published or and having its registered office at 43-45, Allée CONFIDENTIALITY: The information contained basis of the information set out in this Document. prepared by other parties, including, without herein contains proprietary and confidential Before making any investment decision, you limitation, personnel of PAI portfolio companies Scheffer, L-2520 Luxembourg. information that is intended solely for the should seek independent investment, legal, (“Third Party Information”). While such sources addressee. Each recipient of this Document is tax, accounting or other professional advice as are believed to be reliable, none of the PAI entities For further information about PAI please visit our deemed to have agreed not to use, reproduce, appropriate in order to determine what reliance (if or any of their respective directors, officers, website at www.paipartners.com publish or distribute in whole or in part any any) you should place on this Document. employees, partners, shareholders or agents information contained in this Document or (each, a “PAI Party”) assumes any responsibility further made available in connection with this for the accuracy of any Third-Party Information. PERFORMANCE: Any past or projected Document (the “Information”) nor should its performance presented in this Document are No PAI Party makes any representation or contents be disclosed to any person, in either not necessarily indicative of future results and warranty, express or implied, as to the accuracy case without the prior written consent of PAI, that there can be no assurance that the Fund will or completeness of any Third Party Information except to the recipient's professional advisers achieve comparable results or that target returns or any opinions contained in this presentation.

84