Management of Post Merger Integration Projects Global network of innovation Management of Post Merger Integration Projects

Failure Rates of Mergers: Overview empirical studies Global network Failure Rates of Mergers: Overview empirical studies of innovation General Analysis Specific Analysis 100% Consulting Science 83% 85% 79% 80% 78,5% 72% 75% 71% 69% 61% 63% 62% 60% 56% 50% 47% 40% 40% 20% Mercer Bain McK Porter Harbison Europ. Cross Merger Bank 1996 1997 1987 1988 Silver IMA Deals Border Cross of Equals MoE Hayes 1984 2000 KPMG Border J.P. Morgan IMA 1998 1998 IMA 1998 2000 2000

Problems and Reasons for Failure Global network Problems and Reasons for Failure of innovation Percent o f Respondents Problems identified in Post-Merger Integration Insufficient communication 58% Financial/ synergy expectations unrealistic or unclear 47% Compromises in new organization 47% structure „Master Plan“ missing 37% Missing momentum 37% Lack of top management commitment 32% Unclear strategic concept 26% Missing pace of project 26% IT i ssues adressed too late 21% Source: A.T. Kearney

Studies show: of innovation PMI is the weak point in M&A management Global network PMI is the weak point in M&A management Main problem areas in M&A management* Strategic Transaction Integration Analysis * Example from: Boston Consulting Group: Multiclient study

Integration Steps BUILD Global network of innovation KEY ACTIONS: • Evaluation of organizational models and selection of the Future Mode of Operations • Determination of the prime and supporting process model in the context of a superior process model • Validation of existing processes and adjustment where necessary • Determination of the concept for the implementation of the process model (incl. Quick Wins) • Refinement and agreement on roles, responsibilities and competencies (incl. P&L) • Development of action plan for the set up of structural elements with regards to portfolio, employees, management of employees and ressources • Definition and development of the target agreement system and the respective controlling requirements

Integration Steps BUILD Global network of innovation KEY ACTIONS (cont.): • Mission critical: Detailled project plan and dedicated project organization • Implementation of work and project teams: - strategic: Countries, Production Sites, Brand- and Productportfolio - operational: R&D, Delivery, Logistics - central: Finance & Accounting, IT, Law and HR • Development of an internal and external communication concept/plan • Define milestone and benchmarks to ensure and to proof the realisation of synergies and to ensure the compliance with the transformation plan

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