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(1)
(2)

A

Stronger together

– World class infrastructure

(3)

• Sweco acquires 100% of the shares

in Vectura of the Swedish

Government

• Consideration 927 MSEK

(Enterprise Value approximately 900

MSEK)

• Synergies >70 MSEK

- Predominantly costs synergies

- Additional upside potential

• Expected to contribute 100 MSEK to

operating profit (EBITA) by 2015 –

EPS accretive +9%

Summary of the deal

(4)

Strategic rationale

Continued value creating growth for Sweco’s shareholders

• Consolidates Sweco’s position as the leading consultancy in sustainable engineering and design

• Supplements Sweco with a market-leading position in the railway sector

• Strengthens the customer offering in roads, project management and traffic planning

• Strengthens Sweco’s position in the fast growing Swedish infrastructure market

• Opens up greater opportunities in the fast-growing Nordic market, above all in Norway. • Realizes substantial cost synergies

(5)

Sweco after the combination

5

#1

in the Nordics

Top 10

in Europe

9 000

employees

• Net sales

SEK 8,8 billion

• The Nordic’s leading engineering

consultancy for infrastructure of the

future

(6)

Area of operation

Share of sales

Infrastructure

Structural engineering

Building service systems

Energy systems

Water and Environment

Industry

Architecture

Project Management

Geographic IT

27%

16%

12%

11%

10%

8%

7%

7%

2%

Sweco after the combination

(7)

Strong market positions

Permanent establishments in 12

countries and successful projects

around the globe

• Market leading positions in

Sweden, Norway and Finland

• Strong niche positions in Central

and Eastern Europe

• Capacity to offer full service

offerings in international projects

(8)

Nordic leadership

Market share

14%

Sweden

10%

Norway

10%

Finland

Source: Svensk Teknik & Design, Sweco

• >10% market share and leading

positions (1-4) in Nordic home

markets

• Nordics representing ~85% of Net

Sales

• Considerable potential to continue

to increase market shares

(9)

9

• The Nordic’s leading consultancy in

transportation infrastructure

• Particularly strong in railway

• Employees: 1 200

• Net sales: 1 300 MSEK

• Growth 7% annually 2010-2012

• Operating margin 2012 (EBIT) 31 MSEK

• Operations at ~40 locations in Sweden,

Norway and Denmark

• Established 2009 after combining the

national road and railway agencies’

consulting organizations

(10)

42 36 12 8 2

Vectura in brief

Other Trafic & urban planning

Road* Rail* Project & construction mgmt

Share of revenues, %

94%

5%

1%

*InfraDesign unit
(11)

11 • 26 km double track railway

• 2 stations • 40 bridges

• 28 km highway with 35 bridges, of which a 620 m long steel bridge over Motalaviken • Railway tunnel under central

Gothenburg

• 8 km double track railway • 6 km tunnel

• Civil engineering and railway • Extension from 2 to 4 tracks

between Tomteboda-Kallhäll • In total 20 km

Vectura – Project examples

(12)

Strong market development

• Continued strong growth of infrastructure investments

• Sweco strengthens the position in this fast growing market – From 16% to 27% of group sales

• Also adds capabilities to participate in the strong growth in Norway

12

* Source: Trafikverket;Transportsystemets behov av kapacitetshöjande åtgärder (2012); Infrastrukturproposition 2012; Budgetpropositionen 2013; Vårpropositionen 2013; Riksrevisionens rapport om statens satsningar på transportinfrastruktur (2013), Swecoanalysis. ** Source: Nasjonal transportplan 2014-2023 (2013); Statsbudsjettet 2011, 2012, 2013

2013

Government investments Sweden

Government investments Norway

16 19 18 27 Railroad Road 2018 +36% 46 34 2013 6 9 10 20 Railroad Road 2018 +75% 17 SEK billion monetary value 2013* NOK billion monetary value 2013** 29

(13)

The Nordic’s leading engineering consultancy

Net Sales 2012, SEK billions, Nordic countries

13 1) Pro forma 2012. 2) Pro forma ÅF+ Epsilon 2012. Source: Year-end reports, Branschöversikten 2012

Conversion ratesr: EUR/SEK: 8,70 DKK/SEK: 1,17 NOK/SEK: 1,16 (average full year 2012)

7,9 7,1 6,5 5,1 3,3 2) 1) +

(14)

A

+

Value creating combination

(15)

15

The transaction

• Consideration 927 MSEK (Enterprise Value ~900 MSEK on the day of closing)

• EV/EBITA 9x (incl. synergies) • EV/Sales 0,7x

• Financed through a combination of existing and new credit facilities – Cost of financing ~3%

• Sweco’s financial target of Net debt/Equity <0,4 will be exceeded – Considered to be done with balanced risk taking

(16)

16

Impact on income

• Vectura’s EBIT 2012: 31 MSEK

• Yearly synergies exceeding 70 MSEK by 2015 – Primarily cost synergies – Additional upside potential

• Contribution to Sweco’s EBITA ~100 MSEK by 2015 • Integration costs estimated to 100 MSEK – Will

primarily impact income H2 2013 and H1 2014 • Transaction costs 5 MSEK will impact income Q2

2013

• EPS +0,48 SEK or +9% (including synergies 2015)

(17)

Profitability – Sweco vs. Vectura

17 Sweco Sweden 10,3% Other 0,6% Administration 5,4% Project operations 0,9% Billing ratio 1,1% Vectura 2,3%

Healthy and profitable project operations

2/3 of difference attributable to administration costs

• Vectura start-up and incorporation costs

• Economies of scale in Sweco’s administration

Significant synergy potential

Source: Sweco analysis

2012

(18)

Norway 70 Traffic & Urban planning 109 Project & construction mgmt 158 Infradesign 1.031 -8,6 -17,4 5,1 4,7 EBIT-margin (%) -6 8 -19 48 EBIT (MSEK)

Net Sales (MSEK)

(19)

Sweco – 41 locations Vectura – 37 locations 26 overlapping locations Sweco Vectura 19

Synergies

Cost synergies (2015 >45 MSEK) • Reduction of external costs

• Coordination of administrative services • Co-location of offices

Coordination of unprofitable units with Sweco (2015 >25 MSEK)

• Coordination of the Norwegian business with Sweco Norway

• Coordination of Traffic & Urban planning with Sweco’s similar business

Potential for additional cost synergies – Longer term same profitability is expected as other Sweco

Sweden

(20)

Illustrative pro forma 2012, incl. synergies

Consolidated statement of income MSEK Sweco Vectura Adjustment Combined Increase

Net Sales 7 504 1 326 8 830 +18%

Operating costs -6 747 -1 295 -7 972

EBITA 757 31 70 858 +13%

EBITA margin 10,1% 2,3% 9,7%

Amortizations and depreciations -75 0 -12 -88

EBIT 682 31 58 770 +13%

EBIT margin 9,1% 2,3% 8,7%

Financial net -29 -1 -29 -58

Profit before tax 653 30 29 712 +9%

Income tax -177 -6 -9 -192

Profit for the period 476 24 20 519 +9%

Non controlling interests -6 -6

Earnings per share attributable to owners of the

Parent Company 470 24 20 514

(21)

21

Next steps

• Filing to competition authorities in

Sweden and Norway

• Closing in August 2013, provided

competition authorities positive ruling

• Vectura to be integrated in Sweco

Sweden using the Sweco brand

• Vectura continues to operate with current

organization and brand during a

transitional period

• Majority of integration completed H1

2014

(22)

A

Stronger together – The Nordic region’s

leading engineering consultancy

References

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