1. Kasteellaan 160 | B-9000 Gent | BE 0426.851.666 | RPR Gent | TEL. +32 9 224 43 60 | FAX +32 9 224 01 69 | www.dvn.be | info@dvn.be When I’m 64 InterDirect Network sept 2010 Georges Van Nevel

2. Kasteellaan 160 | B-9000 Gent | BE 0426.851.666 | RPR Gent | TEL. +32 9 224 43 60 | FAX +32 9 224 01 69 | www.dvn.be | info@dvn.be Succession planning or the next generation

3. Background ●Some day, we will all retire. ●You think you’ve worked enough.

4. Key issue ●What to do?

5. Selling ●To a third party ●To the kids ●To the other management members

6. Trends ●Sector fragmentation ◦Smaller agencies ◦Importance of freelance groups ●The role of procurement and financial people: ◦Fee and price pressure

7. Trends ●Marketing is becoming increasingly marginalised in big companies. Even more in smaller countries. ●Networks are concentrating on BRIC-countries and on-line. ●China: they have the tangible stuff, but they don’t have the brands. ●Converting communication into a commodity. Split-up of the jobs.

8. Trends ●Digital/social media are our core business. ●Software as a commodity tool in the digital world. ●Private equity offers other opportunities.

9. Conclusion It’s a new world.

10. Selling to a third party ●Networks ●Private equity ●Private individuals as sleeping partners

11. Selling to the kids ●Do they have the know-how and the skills? ●Integration within the existing management team. ●Your other kids.

12. Selling to the management team ●Are they willing to invest? ●Do they have the money or the capital sources?

13. New trend ●A mix of shareholders. ●The previous owner becomes sleeping partner. ●Other parties concerned become shareholder (eg printer, software developer, holding, …)

14. Rating methods ●Based on historical performances. ●Discounted Cash Flow method (DCF). ●Earn out: ◦Based on growth ◦3 – 5 years ◦Multiplier influenced by certain criteria ●Importance of continuity ●Value ≠ price

15. Model ●Old situation Selling price: 1.000 Owner 1: 600 Owner 2: 400 Owner 1Owner 2 Agency x 60%40%

16. Model ●New situation alternative 1 Owner 2Owner 3 NewCo Owner 4 Agency x 60%20% 100%

17. Model ●New situation alternative 2 Owner 2Owner 3 Agency x Owner 4 60%20%

18. ●Capital: 400 ◦Owner 2: 240 ◦Owner 3: 80 ◦Owner 4: 80 ●Bank loans: 600 New financial situation

19. ●The way it used to be: ◦20/80 ●Nowadays: ◦30/70 ◦40/60 Trend

20. ●5 – 7 years Payback period

21. My interest is in the future, because I’m going to spend the rest of my life there Thank you