210 mm 5.5 210 mm mm Translation Report on Opinion of Independent Financial Advisor regarding the Connected Transaction with respect to the Acquisition of Amarin Book Center Company Limited to the Shareholders of Amarin Printing and Publishing Public Company Limited Prepared by 275 mm EY Corporate Services Limited 22 March 2018 Translation Table of contents Table of contents ....................................................................................................................................................................i Abbreviation .......................................................................................................................................................................... iii 1. Executive summary ......................................................................................................................................................... 1 2. Transaction background ................................................................................................................................................ 5 2.1 Nature and details of transaction ............................................................................................................................... 5 2.2 Related counterparties and their relationship with AMARIN ................................................................................... 6 2.3 Type and size of transactions..................................................................................................................................... 7 2.3.1 Connected transactions ................................................................................................................................ 7 2.3.2 Asset acquisition transaction ........................................................................................................................ 9 2.4 Sources of fund for undertaking of the transaction ................................................................................................ 10 2.5 Value of consideration and basis for determining the value of consideration ..................................................... 11 2.6 Agreement and draft significant conditions ............................................................................................................ 11 2.7 Date of entering into the transaction ........................................................................................................................ 12 3. Summary information of AMARIN and ABOOK .......................................................................................................... 13 3.1 Summary information and financial position of AMARIN ....................................................................................... 13 3.1.1 Business overview and milestones ............................................................................................................ 13 3.1.2 Shareholding structure ................................................................................................................................ 18 3.1.3 Structure of AMARIN’s Board of Directors................................................................................................. 19 3.1.4 Summary of financial performance and financial position of AMARIN ................................................... 20 3.2 Summary information and financial position of ABOOK ........................................................................................ 29 3.2.1 Business overview and key milestones ..................................................................................................... 29 3.2.2 Shareholding structure ................................................................................................................................ 31 3.2.3 Structure of Board of Directors and Executive management .................................................................. 31 i 1 Translation 3.2.4 Competition .................................................................................................................................................. 32 3.2.5 Summary of financial performance and financial position of ABOOK .................................................... 33 3.3. Economic and industry overview ............................................................................................................................. 46 3.3.1 Thailand’s economic overview .................................................................................................................... 46 3.3.2 Overview and trend of book business ........................................................................................................ 49 4. Reasonableness and benefits of the transaction to AMARIN ................................................................................... 52 4.1 Objectives and necessity of undertaking the transaction ..................................................................................... 52 4.2 Advantages and disadvantages of undertaking the transaction .......................................................................... 52 4.3 Advantages and disadvantages of not undertaking the transaction .................................................................... 56 4.4 Comparison of advantages and disadvantages of undertaking the transaction with connected person and with a third party ................................................................................................................................................................. 57 5. Reasonableness of the price and conditions of the transaction .............................................................................. 58 5.1 Key assumptions applied in forming the IFA’s opinion .......................................................................................... 58 5.1.1 Discounted cash flow method (DCF) ......................................................................................................... 59 5.1.2 Market comparable method ........................................................................................................................ 72 5.1.3 Transaction comparable method ............................................................................................................... 78 5.1.4 Book value method ...................................................................................................................................... 81 5.1.5 Adjusted book value method ...................................................................................................................... 82 5.2 Valuation of ABOOK’s shares ................................................................................................................................... 85 6. IFA’s opinion regarding resolution of shareholders ................................................................................................... 88 ii 2 Translation Abbreviation Abbreviations Descriptions ABOOK Amarin Book Center Company Limited Acquisition Price THB 5,500.00 per share AMTV Amarin Television Company Limited BOT Bank of Thailand CAGR Compound Annual Growth Rate CAPM Capital Asset Pricing Model Company or AMARIN Amarin Printing & Publishing Public Company Limited D&A Depreciation & amortisation DCF Discounted cash flow method EBIT Earnings before interest and taxes EBITDA Earnings before interest, taxes, depreciation and amortisation EBT Earnings before taxes EV/EBITDA Enterprise value to earnings before interest, taxes, depreciation and amortisation GDP Gross domestic product IFA Independent Financial Advisor or EY Corporate Services Limited IMC Integrated marketing communications Investment in ABOOK Acquisition of 81,000 ordinary shares of ABOOK from the existing shareholders of ABOOK for a total value of THB 445.5 million or equivalent to THB 5,500.0 per share Kd Cost of debt Ke Cost of equity License Digital television license MPC Monetary Policy Committee NBTC National Broadcasting and Telecommunication Commission iii 3 Translation Abbreviations Descriptions NCI Non-controlling interest NTA Net tangible asset OBEC Office of the Basic Education Commission P/BV Price to book value P/E Price to earning PCL Public Company Limited Rules on Acquisition and Disposition of Notification of the Capital Market Supervisory Board No. Tor. Jor. Assets 20/2551 Re: Rules on Entering into Material Transactions Deemed as Acquisition or Disposal of Assets dated 31 August 2008 (including any amendments thereto) and the Notification of the Board of Governors of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies Concerning the Acquisition and Disposition of Assets dated 29 October 2004 (including any amendments thereto) Rules on Connected Transaction Notification of the Capital Market Supervisory Board No. Tor. Jor. 21/2551 Re: Rules on Connected Transactions dated 31 August 2008 (including any amendments thereto) and the Notification of the Board of Governors of the Stock Exchange of Thailand Re: Disclosure of Information and Other Acts of Listed Companies Concerning Connected Transactions B.E.2546 dated 19 November 2003 (including any amendments thereto) SE-ED SE-EDUCATION Public Company Limited Sellers Existing shareholders of ABOOK SET Stock Exchange of Thailand SG&A expense Selling, general, and administrative expense THB Thai Baht WACC Weighted average cost of capital iv 4 Translation EY Corporate Services Limited 33rd floor, Lake