ÖIAG-law:December 1993 New tasks:Privatisation No industrial concern Aim:To pay back goverment & bank loans Privatisation concept  proposed by management board of ÖIAG  approved by privatisation committee & super- visory board  approved by goverment (minister committee)  final approval by shareholder meeting (minister of public enterprises&transportation) in February 1994 Privatisation Law 1997 Österreichische Industrieholding Aktiengesellschaft (ÖIAG)

ÖIAG - PRIVATISATION PROCEDURE 1.Decision on WAY of Privatisation FIPO (selling old shares) FIPO + capital increase (selling old and new shares) FSale to strategic Investor 2.Preparatory Work FRestructuring/Regrouping FTransforming business into separate legal entities Fturn around profitability 3.Privatisation Process IPOStrategic Sale 4. AIM: High Proceeds Preserving Austrian Interests

to 1.How does ÖIAG proceed in privatising? -Stock exchange -selling to strategic investors -MBO/MBI First you have to decide in which way you want to privatise your firms: Fwether you want to make an IPO i.e. you sell the shares to the public on the stock exchange For you combine an IPO with the infusion of new equity capital into the firm to privatise: i.e.: you sell old shares and issue new shares that are only bought by the public in this case the owner (=state) doesn´t get as much money as in the case of selling only old shares and you only go this way if the companies needs fresh money. The thus enhanced value can later be realised in a secondary public offering by the owner For you want to sell the companies to a strategic owner (because it is too small or not interesting (profitable) enough for the stock market.

to 2.Having decided on the kind of privatisation Procedure FPreparatory work: restructuring and /or regrouping of companies:  transforming business into seperate legal entities  giving them the matching legal form (public or limited companies).  to make the turn around before privatising is in most cases is advisable, unless you don´t have the managerial know how to do it.

F IPO Privatisation  select an international and a national investment bank as lead manager who are responsible for the issue  make the prospectus due to the publication requirements of the international stock market  valuation according to the rules of the SEC in the various countries you want to float the company´s shares  organise the PR-publicity campaign of the issue (road shows and one - on - one meetings with potential investors in your country and abroad F Sale to a strategic investor  selection of an investmentbank or corporate advisor who monitors- and accompanies the privatisation process.  valuation (by an auditor or investment bank)  selling memorandum ( investment bank)  list of potential buyers (longlist-shortlist)  send the information memorandum to selected buyers (against signing of a confidentialy agreement)  dataroom - first round  selecting one or two potential buyers with the best offer exclusive bargaining exclusive dataroom insight  signing of a contract  preservation of Austrian interests

IPO / Stock Market privatisation 1.Select investment investment bank(s) as lead manager(s) 2.Prospectus 3. Valuation (SEC-rules) 4.PR + publicity campaign road shows/one on one 5.Book building process: Austrian and abroad 6.Pricing 7. Subscription period

SALE TO A STRATEGIC INVESTOR 1.Select investment bank or corporate advisor 2.Valuation (Auditor or Investment Bank) 3.Information (Selling) memorandum 4.List of potential buyers: Long-/Short list 5.Confidentiality Agreement 6. Data room 7.Select best bid bargaining with best bidders on the basis of a contract drafted by ÖIAG signing closing

AUSTRIAN INTERESTS & ECONOMIC PERFORMANCE SECURING:Workforce Production Future (expansion) of the company high proceeds AUSTRIAN INTERESTS:to keep production facilities and work force in Austria (to countervail de- industrialisation) AUSTRIAN OWNERSHIP: to keep strategic industrial control in Austria