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EPSEQUITA PEP SPAC

Forestali GroupInvestor Presentation

http://www.forestali.it/

January 2018

EPSEQUITA PEP SPAC

Disclaimer

2

This document has been prepared by EPS EQUITA PEP SPAC (“EPS”) and Industrie Chimiche Forestali S.p.A.

(“ICF”) exclusively for use in the presentation of the envisaged business combination between EPS and the target

company.

This document does not constitute or form part of any offer or invitation to sell, or any solicitation to purchase any

shares or any other kind of financial instruments issued or to be issued by EPS and/or the combined entity resulting

from the envisaged business combination between EPS and the target company.

Not all the information contained and the opinions expressed in this document have been independently verified. In

particular, this document contains forward-looking statements and declarations of pre-eminence that are based on

current estimates and assumptions made by the management of EPS and ICF to the best of their knowledge. Such

forward-looking statements and declarations of pre-eminence are subject to risks and uncertainties, the non-

occurrence or occurrence of which could cause the actual results including the financial condition and profitability of

EPS and ICF to differ materially from, or be more negative than, those expressed or implied by such forward-looking

statements and declarations of pre-eminence. Consequently, EPS and ICF can give no assurance regarding the

future accuracy of the estimates of future performance set forth in this document or the actual occurrence of the

predicted developments.

The data and information contained in this document are subject to variations and integrations. Although EPS

reserves the right to make such variations and integrations when it deems necessary or appropriate, EPS assumes

no affirmative disclosure obligation to make such variations and integration and no reliance should be placed on the

accuracy or completeness of the information contained in this document. No person accepts any liability whatsoever

for any loss howsoever arising from the use of this document or of its contents or otherwise arising in connection

therewith.

This document has been provided to you solely for your information and may not be reproduced or redistributed to

any other person. By accepting this document, you agree to be bound by the foregoing limitations.

EPSEQUITA PEP SPAC

Today’s Speakers

3

Guido Cami Chief Executive Officer

Massimo RancilioChief Financial Officer

Marcello TagliettiChief Operating Officer

Index

EPSEQUITA PEP SPAC

1. Company Overview

2. ABC Division: Automotive and Packaging

3. ICF Division: Footwear, Leather Goods & Upholstery

4. Financial Statements 2014 – 2016 and November 2017 YTD

5. Strategic Actions for the Future

6. The Transaction

7. Appendix

EPSEQUITA PEP SPAC

Industrie Chimiche Forestali: a 100-year history

5

Source: company website

1918

Industrie Chimiche

Forestali is founded and

starts with the extraction of

pyroligneous acid from wood

‘20s

The production of

formaldehyde as a derivative

of pyroligneous begins

‘30s

The Forestali activity is enhanced

with the establishment of the

Società Italiana Resine SIR for

the production of phenolic resins

in Sesto S. Giovanni

1941

The production of special

impregnated fabrics for the

footwear industry starts

’50s

The production of

adhesives begins

1983

Industrie Chimiche Forestali stops

producing basic chemicals and

finally focuses on the upstream

segment of the footwear industry

1984

Adhesives for Furniture and Boating are

formulated and introduced into the business

network: Durabond brand is born.

Besides the formulation of high-quality and

ease of use adhesives, already existing

brands are purchased

1987

Forestali relocates production from the plant in

Sesto S. Giovanni to the new plant in Marcallo

con Casone in the province of Milan

2005

ABC (Adhesive Based Chemicals) begins its own activity in

2005, within Forestali, as a company fully dedicated to the

polyurethane adhesives industry for industrial applications

(Automotive, flexible packaging, graphic arts)

Today

Today the production site of Marcallo con Casone

produces: adhesives and technical fabrics for tips and

counters for the footwear industry, and adhesives for

footwear, leather goods and industrial applications

EPSEQUITA PEP SPAC

Industrie Chimiche Forestali at a Glance

6

Note: (1) EBITDA adjusted for €1.6m extra costs from the allocation of the merger loss to inventory (2) As of 31/12/2016

Source: ICF Information

Manufacturing of

adhesives and technical

fabricsCore activity

Forestali in numbers

€71m

+4.3% CAGR

2014-2016

€13.3m (1)

+33% CAGR

2014-2016

18.6% (2016)

15.2%(Average ‘14-’16)

€16.7m

1.3x leverage on

EBITDA Adj.

2016

NFP(as of 31/12/2016)

Footwear

Leather Goods

Automotive

Packaging

Upholstery

End market

Adhesives (water-base,

solvent-free, solvent-base)

Technical Fabrics

(impregnated, coextruded)

Key products

Marcallo con Casone,

Milan (Italy)HQs

c. 51.00% Mandarin Capital

c. 39.28% Progressio SGR

c. 4.17% Guido Cami (CEO)

c. 4.17% Private Equity

Partners

c. 1.38% Others

Shareholding

Adj. EBITDA MarginAdj. EBITDA2016

Revenues2016

120(2)

employees

More than

1,300products

22,000Tons

Adhesive/

Year

• Average age: 43

years

• 22 R&D

employees

• 60,000 sq.m. plant

• 3 labs

• 13 new products

per month

• 84 quality tests per day

• More than 700 industrial clients

3

million meters of

technical

fabrics

EPSEQUITA PEP SPAC

Organizational Structure and Key Management

7

Note: (1) As of 31/12/2016

Source: ICF information

Organizational structure with 120(1) people coordinated

by……an experienced management

CEO

Guido Cami

Sales

Guido Cami

COO

Marcello

Taglietti

General Manager

Forestali de

Mexico

Teresa Navarro

HR

Monica

Moiraghi

CFO

Massimo

Rancilio

Guido Cami Chief Executive Officer

• Graduated in Management Engineering at Politecnico di Milano

• 28 years of experience in industrial companies (Pirelli,

Manifattura di Legnano, Vibram, Pechiney, Crespi, Forestali)

• Expertise: Production, Logistics, Operations, R&D,

Commercial, Managing Direction

• 7+ years in Forestali as CEO

Massimo Rancilio Chief Financial Officer

• 18 years of experience in the Finance function (Oracle,

Accenture, Hexon Specialty Chemicals, MPG Plast)

• 7+ years in Forestali

Marcello Taglietti Chief Operating Officer

• 25+ years of experience in the Operations function (Ashland

Chemicals, Air Products and Chemicals, KMG Chemicals)

• <1 year in Forestali

Monica Moiraghi Human Resources

• 27 years of experience in the HR function

• 19+ years in Forestali

Teresa Navarro General Manager

• General Manager at Forestali de Mexico

• 20+ years in Forestali de Mexico

EPSEQUITA PEP SPAC

Evolution of Revenues and Exposure to Export

8

Source: Company financial statements

Sales have been growing at high single digit since 2009 with export accounting for 65% of group revenues in

2016

41%

59%

Export (% on revenues)

Domestic (% on revenues)

38%

62%

35%

65%

31%

69%

35%

65%

35%

65%

35%

65%

35%

65%

18 20 21 20 21 23 24 25

26

3339 44 39

4245 4743

54

5964

6065

69 71

2009 2010 2011 2012 2013 2014 2015 2016

Domestic Export

Guido Cami and Massimo

Rancilio appointed as CEO

and CFO, respectively

€ million

EPSEQUITA PEP SPAC

Forestali Group: Key Products

9


Adhesives for ICF and ABC divisions and fabrics for the sole ICF division are the main products of the Group

Adhesives

Technical

Fabrics

• Forestali manufactures a wide range of adhesives, all attributable to three

families of adhesives: solvent-based, water-based and solvent-free

adhesives

• Solvent-based adhesives are a mixture of solid ingredients

dissolved in a mix of solvents

• Water-based adhesives are a mixture of solid ingredients

dissolved in water

• Solvent-free adhesives are a mixture of polyols and MDI

isocyanate able to react with temperature and moisture (Reactive

polyurethane)

• The term “fabric” refers to items made for use in the footwear industry like

toe-puffs, counters, linings and reinforcing

• The working processes include various processing phases like

impregnation, hot-melt coating, powder coating, coestrusion and direct

coating

• Toe-puffs and counters constitute the structural part that gives a

shoe shape: in the very front and back parts respectively

• The linings and reinforcing are used to line the inside part of the

shoe or to reinforce some parts or products of leather goods

Division DescriptionProduct

EPSEQUITA PEP SPAC

The «Invisible Power»

10


Footwear &

Leather

Goods

Automotive

Packaging

Adhesives:

• Solvent-based

• Solvent-free

• Water-based

Technical fabrics:

• Toe-puff, counters

/ stiffeners

• Linings and

reinforcing

Technical fabric is used

in the toe puffs and

counters of the shoe.

Adhesive is used to put

together mainly uppers,

insoles and sole units

Technical fabric goes

to reinforce the handle,

bottom and sides of

the bag. Adhesive is

used to glue the linings

Adhesive is used

to glue different

components of the

upholstery

Adhesives:

• Solvent-based

• Solvent-free

• Water-based

Adhesives:

• Solvent-based

• Solvent-free

• Water-based

Adhesives are used to

glue the layers of the

headliner in a vehicle. It

can be applied to light

vehicles (passenger and

commercial)

Adhesives are used to

glue the layers of films

comprising the package

for various applications

(food and non food)

Adhesives are used

to glue the plastic

cover of magazines

and periodicals

Adhesives are used

to glue the pins used

in the staplers and

similar objects

Adhesives have a

negligible impact

on cost of

production of the

final article…

The

«Invisible Power»

…But a relevant

impact on the

performance. A

low quality

adhesive can lead

to serious issues

and costs (eg.

destroyed shoes or

stained car roof)

Product quality,

customized

solutions and

reliability are key

drivers to serve

clients

UpperInsoleSole Unit

Counter

Toe puff

EPSEQUITA PEP SPAC

Relevant Certifications

11


To maintain a high commercial standing with clients, Forestali obtained all the relevant certifications in the

sector

Certification Field Obtained in:

UNI EN ISO

9001Quality 1997

UNI EN ISO

14001Environmental 1998

Registration

EMASIntegrated 2001

OHSAS 18001 Safety 2009

Modello 231 Auditing 2013

UNI EN ISO/TS

16949Automotive 2016

In addition:

• Three managers fully dedicated to HSE

activity

• Compliant with REACH EU Regulation

(«Registration, Evaluation, Authorization

and Restriction of Chemicals»)

Renewal costs of certifications

+

3 dedicated resources

=

€400k / 500k per year to maintain commercial

certifications

Forestali complies with the high standards to

maintain business relationship with multinational

clients and differentiate from smaller competitors

EPSEQUITA PEP SPAC

Breakdown of Revenues in 2016

12

Note: (*) «Commercialized» indicates products purchased and resold to final customers


The company is export-oriented, with a balanced exposure to the Automotive, Footwear and Packaging

sectors

Geographic Area

Export makes up for c. 65% of

revenues for 2016A

The Automotive and the Footwear

market segments account for the large

majority of revenues

ABC Division

45%ICF Division

55%Africa Middle East10% East

Europe13%

Europe CEE19%

Far East12%

Italy35%

America11%

End market

Footwear38%

Leather Goods & Upholstery

4%

Other ICF Clients14%

Automotive36%

Packaging9%

ICF manufactures both adhesives (c.

30%) and fabrics (c. 20%), while ABC

manufactures adhesives only

Business Line

ABC Division

45%ICF Division

55%

Adhesives - Footwear

17%

Adhesives -Other13%

Fabrics -Footwear

18%

Fabrics - Other2%

Commercialized - Footwear *

2%

Commercialized - Other *

3%

Automotive36%

Packaging9%

EPSEQUITA PEP SPAC

36.0% 35.6%38.7%

41.4%

31.4%

9.9% 11.5%15.6%

18.6%

12.3%

2013 2014 2015 2016 11M 2017(2) (3)

19,3%

40.9%

11M 2016(2)(3)

Margins and Profitability Trends

13

Note: (1) (Revenues – Cost of Materials) / Revenues (2) First Margin and EBITDA Margin for FY2016 and 2016YTD are adjusted to account

for allocation of merger loss to inventory (€1.6m) (3) YTD as of 30th November (4) ROCE Adj. calculated as ((EBIT + amortization of goodwill

+ allocation of merger loss to inventory)*(1-tax rate)) / (CE Adj. – Goodwill)


The dominant cost of production is raw materials. Increase in volumes and a lean organization supported extra

margin performances and returns at Forestali Group

Revenues

Margins

11.4% 21.6% 25.2%ROCE Adj.

-0.4pp

+1.5pp+4.1pp

+3.1pp

+3.1pp

+3.6pp

60.165.3

69.1 71.1 72.9

2013 2014 2015 2016 11M 2017 (3)

2014 2015 2016 (4)

36,0% 35,6%38,7%

42,3%

9,9% 11,5%15,6%

18,7%

2013 2014 2015 2016

First Margin (1)

EBITDA Margin

19,3%15,1%

43,6%

35,0%

1H 2016 1H 2017(3) (3)

-9.6pp

-6.8pp

EPSEQUITA PEP SPAC

PP&E Capex for

€13m due to the

purchase of the plant

building

Mandarin Capital buys 95% of

the company from Luciano

Buratti, with PEP and Guido

Cami buying the remaining 5%

Progressio enters in the capital of

Forestali. Releverage of €21mln

through merger with 918 Group

Material Free Cash Flow Generation

14

Note: (1) No dividends have been paid since 2012 (2) Adjusted for extraordinary outflow given by leverages in December 2013 and January

2016 and for changes in the perimeter of consolidation; (3) 11 months ending at 30/11/2017


Ne

t fi

na

nc

ialp

os

itio

n

(Dec-2013) (Jan-2016)

Cash-generative business which has been able to manage 1 extraordinary capex and 1 releverage in 5 years

∆NFP(1)

2012 2013 2014 2015 2016 11M 2017(3)

€2.7 m €(9.6) m €5.4 m €6.3 m €(10.6) m €1.4 m

Adj. Free Cash

Flow Generation(2)

Ke

ye

ve

nts

€2.7 m €3.4 m €5.4 m €6.3 m €8.9 m €1.4 m

10.9

8.2

5.3

17.7

12.4

6.1

27.1

16.7

15.0

-

5.0

10.0

15.0

20.0

25.0

30.0

dic-11 dic-12 dic-13 dic-14 dic-15 dic-16 nov-17

(Jul-2014)

Cumulative Adjusted

Free Cash Flow

Generation

2012 – 2017 11M:

€28.1m

EPSEQUITA PEP SPAC

Key Distinguishing Factors

15


Constant investments in R&D

Technical assistance to clients to create ad-hoc products for specific needs

Realization of projects to develop new products in collaboration with clients

High quality products

Visible and well-positioned brands

Diversification in different market sectors and geographies

Index

EPSEQUITA PEP SPAC

1. Company Overview





6. The Transaction

7. Appendix

EPSEQUITA PEP SPAC

Attractive Market Trends in the Automotive Sector

17

Source: ICF Information, Bloomberg, Vehicle Production; Analysis on OICA and HIS Automotive

The automotive sector has been growing since 2013 by 2.8% per year (expected 3% CAGR ‘16-’20), with the

ABC Automotive division over-performing the market with a 14% annual growth

Automotive end market: past evolution… …and future prospects

USA

CAGR 17-20: 0.9%

Europe

CAGR 17-20: 2.2%

Asia Pacific

CAGR 17-20: 3.3%

Global CAGR 16-20: 2.9%

ABC Automotive: Revenues 2013-2016 (€m)

17.621.1 22.4

25.8

2013 2014 2015 2016

Adhesives volumes (ton)

6,681 8,202 8,829 10,599

87

9091

95

2013 2014 2015 2016

Million light vehicles produced

Source: Bloomberg, Vehicle Production

Source: Analysis on OICA and HIS AutomotiveSource: ICF Information

EPSEQUITA PEP SPAC

High Client Penetration in the Automotive Sector

18

Through the ABC division, Forestali serves 4 main clients in more than 20 countries

• Revenues 2016: €5.2bn

of which €2.1bn in Overheads & Soft Trim (1 out of 4

vehicles served worldwide)

• 167 production plants and Just-in-time centers in 26

countries

• >50 manufacturing facilities in 20 countries

• Revenues 2016: €150m

• 8 production plants in 4 countries

• Revenues 2015: €1.4bn

• 63 production plants in 19 countries

Main clients

Other Clients

Around 95m (1) vehicles have

been produced in 2016 in the

world

~ 300g/500g of adhesive are

necessary for each headliner in a

vehicle

ABC penetrationForestali Group

revenues

2016: €71 m

Automotive36%

ABC sold around 10,600 tons of

adhesive in 2016 to its

Automotive clients

Note: (1) Source: Bloomberg

Source: ICF information; corporate websites; financial statements; Bloomberg

EPSEQUITA PEP SPAC

Flexible Packaging Sector

19

Source: ICF Information, Euromonitor

ABC Packaging grew at a 14% CAGR in the last 4 years, hugely outperforming the growth of the market (2.5%

CAGR 13-16)

Flexible packaging sector (€bn)

3.1 3.2 3.4 3.5 3.6 3.8 3.9 4.1

38.5 39.3 40.3 41.5 43.0 44.6 46.3 48.1

2.5 2.6 2.62.7

2.82.8

2.93.0

1.7 1.7 1.81.9

2.02.0

2.12.2

2.7 2.72.7

2.82.9

3.03.2

3.3

4.4 4.54.6

4.85.1

5.35.5

5.7

1.7 1.61.6

1.61.6

1.61.6

1.6

2.1 2.12.2

2.22.2

2.32.3

2.4

56.8 57.959.3

61.163.2

65.567.9

70.4

2013 2014 2015 2016 2017E 2018E 2019E 2020E

Other non food

Tobacco

Pharma

Cosmetics

Pet food

Drinks

Food (notfrozen)

Frozen food

Food service represents more than 70% of revenues in

2016

4.85.1

6.2 6.2

2013 2014 2015 2016

ABC Packaging: Revenues 2013-2016 (€m)

The historical growth of ABC Packaging in the last 4 year is

c.14%, vs a sector growth of 2.5%


1,804 1,928 2,404 2,414

Source: Euromonitor Source: ICF information

Index

EPSEQUITA PEP SPAC

1. Company Overview





6. The Transaction

7. Appendix

EPSEQUITA PEP SPAC

Overview of the ICF Division: Footwear & Leather Goods

21


The largest portion of revenues for the ICF Division comes from Footwear (68% of ICF revenues in 2016), with

Leather Goods & Upholstery accounting for 6% and Other ICF clients for 26%

ICF Division revenues (€m)

27.4 28.0 27.5 26.8

0.8 1.3 2.0 2.5

9.29.7 11.4 10.1

37.539.0

40.939.3

2013 2014 2015 2016

Footwear Leather Goods & Upholstery Other ICF Clients

Footwear

• Adhesives and technical fabrics for the footwear industry

• Used to glue the body with the sole

Leather Goods & Upholstery

• Adhesives and technical fabrics for leather goods and

upholstered furniture

Other ICF Clients

• It includes sales to directional clients and the sales to Africa

and Middle East


7,500 7,580 8,407 8,050

Technical fabrics volumes (‘000 meters)

3,020 3,140 2,974 3,151

Index

EPSEQUITA PEP SPAC

1. Company Overview





6. The Transaction

7. Appendix

EPSEQUITA PEP SPAC

Income Statement 2014 – 2016 and November 2017 YTD

23

Note: (1) The merger loss results from the merger between the holding company 918 Group and Industrie Chimiche Forestali on 01/08/2016

Source: 2015 – 2016 consolidated financial statements. Where indicated with (*), consolidated management accounts (unaudited)

Comments on the P&L

1. For FY2016 it includes €1.6m extra costs from the

allocation of the merger loss(1) to inventory

2. The first margin increased by 9.5% year-on-year,

due to a drop in the prices of raw materials

throughout the period, not completely mirrored in

the selling price. During the first eleven months of

2017 the first margin declined sharply (-10%)

compared to the same period of 2016 because of

the steep increase in raw materials prices

3. The adjusted EBITDA for FY2016, grossing up the

the extra costs allocated to inventory, is €13.3m and

it reveals an overperformance in 2016 compared to

2015 due to the exceptional drop in the price of raw

materials during the year. The decrease in EBITDA

in the 11-month period of 2017 mainly reflects the

increase of the cost of raw materials

4. The D&A from 2016 onwards include €3m annually

of amortization of goodwill, deriving from the

merger of 918 Group Srl (former holding) and

Advanced Based Chemicals Srl (“ABC”) into ICF

S.p.A.

5. The adjusted net income for FY2016 is €7.7m,

and it is calculated grossing up the cited extra costs

allocated to inventory for €1.6m and the

amortization of goodwill for €3.0m, both non-

deductible costs

1

2

3

€ '000 2014* 2015 2016 CAGR 14-16 30-nov-16 30-nov-17

Revenues 65,342 69,118 71,143 4.3% 65,911 72,881

Other revenues 142 324 (882) (260) 2,077

Total revenues 65,484 69,441 70,261 3.6% 65,651 74,958

Y-o-Y growth (%) 8.1% 6.0% 1.2% 14.2%

Cost of materials (42,229) (42,714) (42,390) (40,267) (52,100)

First margin 23,255 26,727 27,871 9.5% 25,384 22,858

Margin (%) 36% 39% 39% 39% 31%

Services (7,806) (7,644) (8,006) (7,126) (7,311)

Production (2,747) (2,136) (2,445) n.a. n.a.

Commercial (3,829) (3,762) (3,740) n.a. n.a.

G&A (1,230) (1,746) (1,821) n.a. n.a.

Cost of labor (7,956) (7,656) (8,058) (7,565) (7,906)

Other costs - (671) (137) 281 1,310

EBITDA 7,493 10,757 11,669 25% 10,974 8,951

Margin (%) 11.5% 15.6% 16.4% 16.6% 12.3%

D&A (1,864) (1,589) (4,766) (4,539) (4,439)

Amortization n.a. (144) (3,167) (3,022) (2,931)

Depreciation n.a. (1,445) (1,599) (1,516) (1,507)

Write-downs and provisions (651) (440) (250) (106) (40)

EBIT 4,978 8,728 6,653 16% 6,329 4,472

Margin (%) 7.6% 12.6% 9.4% 9.6% 6.1%

Financial income / (expenses) (545) (491) (990) (1,087) (1,163)

Foreign exchange income/(expenses) n.a. (38) (53) (165) (192)

Extraordinary income/(expenses) 15 (9) (52) - 54

EBT 4,448 8,227 5,612 12% 5,242 3,364

Tax (1,753) (2,725) (2,515) (2,244) (1,689)

Net income 2,695 5,502 3,096 7.2% 2,998 1,675

Margin (%) 4.1% 8.0% 4.4% 4.5% 2.3%

- to minorities n.a. (0) (0) (0) 0

- to parent company n.a. 5,503 3,097 2,999 1,675

2

4

1

3

5

4

5

EPSEQUITA PEP SPAC

Balance Sheet 2014 – 2016 and November 2017

24


Comments on the BS

1. The dynamics of DSO and DSI are overall constant

during the period. The DPO increased in FY2016

due to a stretching on payments to suppliers.

The increase in inventory for 2017 YTD reflects both

the increase in the inventory of finished goods, due

to a higher stock to face increasing demand, and

raw materials, due to increasing demand and higher

prices of raw materials compared to 2016

2. Intangible assets as of FY2016 include €30m of

goodwill from the merger of 918 Group Srl, ICF

and ABC, amortized over a 10-year period

3. Tangible assets as of FY2016 increased due to the

PP&A allocation (€4.7m) of the cited merger loss

4. Reserves increased for the FY2016 due to changes

in the consolidation perimeter: an SPV (918

Group) purchased the 100% of ICF S.p.A. from

GC3, the former holding company. Then, ABC S.r.l.

merged into ICF S.p.A. and finally 918 Group

reverse merged into ICF S.p.A.

5. Financial debt increased in FY2016 due to the

releverage (around €21m) following the reverse

merge with the SPV 918 Group

1

1

2

2

3

3

4

4

5

5

€ '000 2014* 2015 2016 30-nov-17

Inventory 7,581 7,678 8,227 11,931

Accounts receivables 17,848 18,457 18,403 20,880

Accounts payable (12,238) (11,764) (13,895) (17,823)

Trade working capital 13,192 14,371 12,735 14,987

Total other assets / (liabilities) (1,264) (2,435) (1,876) (653)

Working capital 11,928 11,936 10,859 14,334

Intangible assets 1,511 1,091 28,252 25,611

Tangible assets 14,394 13,609 17,403 16,872

Financial assets 100 2 2 2

Fixed assets 16,005 14,702 45,656 42,484

Employees' leaving indemnities (766) (771) (778) (792)

Other funds n.a. (415) (588) (566)

Net invested capital 27,168 25,452 55,150 55,459

Share capital 5,890 5,890 5,890 5,890

Reserves 6,202 7,970 29,475 32,579

Net income to the parent company 2,695 5,503 3,097 1,675

Minority interests n.a. (0) (1) (1)

Shareholders' equity 14,787 19,362 38,461 40,143

LT debt 10,691 7,817 24,599 20,636

ST debt n.a. 2,498 2,644 2,143

Other financial debt 1,694 - - -

Financial debt 12,385 10,315 27,244 22,779

Cash & equivalents (4) (4,225) (10,555) (7,463)

Net financial position 12,381 6,090 16,689 15,316

Sources 27,168 25,452 55,150 55,459

EPSEQUITA PEP SPAC

Cash Flow Statement 2015 – 2016

25


Comments on the CF Statement

1 1. Although the exceptional performance in 2016, the

net income has been depressed by several non-

cash items, which were not present in the previous

years including the amortization of goodwill (€3m)

and the cited allocation of merger loss to

inventory (€1.6m)

2. The increase of working capital in FY2015 is

consistent with the growth of the business during

the year. On the other hand, the cash generation

provided by the decrease in WC in 2016 reflects

the increase in the DPO in FY2016

3. The group consistently generated cash flows from

operations during the last 3 years, with a

considerable growth both in FY2015 and FY2016

4. Considered that the company did not distribute

dividends during the period 2014-2016, cash

generated from operations has been used to

deleverage the company

1

2

2

33

4

4

€ '000 2015* 2016

Net income 5,503 3,096

D&A 1,589 4,762

Provisions 275 502

Write-downs 47 35

∆WC 441 1,406

Other cash items (600) -

Cash flows from operations 7,255 9,801

Tangible capex (965) (678)

Intangible capex - (243)

Cash flows from investing (965) (921)

Operating Free Cash Flow 6,290 8,880

Debt issuance / (reimbursement) (2,069) (2,550)

Cash flows from financing (2,069) (2,550)

Available cash flows 4,221 6,330

Index

EPSEQUITA PEP SPAC

1. Company Overview





6. The Transaction

7. Appendix

EPSEQUITA PEP SPAC

Adhesives & Sealants Industry: A Fragmented Market Space

27

Split by market Split by region

34%

8%

58%

Industry

Construction

Do-It-Yourself

31%

28%

41%

Asia & RoW

+5%/yearEurope

+2%/year

North

America

+3%/year

Major Players

More than 100

companies with

sales < €100m

Other large

players with

sales >

€100m

H.B. Fuller

Bostik

Sika

Henkel

A 50 billion euro market with strong growth drivers (3% to

3.5% a year)

From organic growth to expansion through value

accretive bolt-on acquisitions delivering high synergies

as a combination of:

Purchasing synergies: raw materials,

goods and services, logistics

Operational excellence

Commercial synergies: new

geographies, new markets

€50 bln €50 bln

€50 bln

Source: Arkema Capital Markets Day 2017

EPSEQUITA PEP SPAC

Future Actions

28


• Development of geographic

areas for Footwear

• China, India, Brazil, Vietnam,

Indonesia

• Development of geographic

areas for flexible packaging

• West Africa, Egypt, Iran

• Production of water-based

adhesives in Asia

• Increase in sales of linings and

reinforcing (started in 2017), in

Italy and abroad

• Exploring a potential

commercial agreement with a

leading raw material player to

better develop Automotive and

Packaging segments

• Development of a new project

for adhesives with extruded

materials

• Project for a new delivery

system of adhesives

Strategic actions for 2018-2020 In the mid term

Index

EPSEQUITA PEP SPAC

1. Company Overview





6. The Transaction

7. Appendix

EPSEQUITA PEP SPAC

Current Shareholding Structures

30

Note: (1) Other shareholders include Carlo Sironi (0.7%) and Carlo Tanoni (0.7%)

Industrie Chimiche Forestali S.p.A. EQUITA PEP SPAC

97.4%

2.6%

Market investors

Sponsors

• Ordinary shares: 5,890,000

• Main shareholders

‒ Mandarin Capital Partners: private equity fund

‒ Progressio: private equity fund

‒ Private Equity Partners S.p.A. (“PEP” or “Private

Equity Partners”): investment company

‒ Guido Cami: CEO of Industrie Chimiche Forestali S.p.A.

51.0%39.3%

4.2%4.2% 1.4%

Mandarin

Progressio

Private EquityPartners

Guido Cami

Othershareholders (1)


• Special shares: 400,000

‒ Not negotiated on a regulated market

‒ No voting rights nor entitlement to ordinary dividends

‒ Conversion with 6:1 ratio of Ordinary shares for each

Special share at certain thresholds

• Market Warrants

‒ Strike price: €9.50

‒ Attribution ratio: 5:10. 2 Warrants assigned at IPO and 3

Warrants assigned at Business Combination

EPSEQUITA PEP SPAC

Key Metrics of the Transaction

31

Valuation

methodology• Valuation approach: Multiples

Transaction

details

• Purchase price: €69.1 m

• Bridge to Enterprise Value: €18.3 m

+ net debt at 30-11-2017 (€15.3 m)

+ cash-out for stock option plan (€3.0 m)

• Implied Enterprise Value: €87.4 m

• Implied 2016 multiples:

• P/E Adj.: 9.0x

• EV/EBITDA Adj.: 6.6x

• EV/EBIT Adj.: 7.8x

Adjustments (€ mln)

EBITDA 2016 11.7

Allocation of merger loss to inventory 1.6

EBITDA Adj. 2016 13.3

EBIT 2016 6.7


Amortization of goodwill 3.0

EBIT Adj. 2016 11.3

Net income 2016 3.1



Net income Adj. 2016 7.7

EBITDA 11M 2017 9.0

EBIT 11M 2017 4.5


EBIT 11M 2017 Adj. 7.2

Net income 11M 2017 1.7


Net income 11M 2017 Adj. 4.42

01

611

M 2

01

7

EPSEQUITA PEP SPAC

Key Transaction Elements

32

After the demerger of EPS 2, EPS will purchase 100% of ICF and the management and PEP will inject new

capital in the Group

EPS2 is demerged from EPS with the cashnot used for the acquisition of ICF net ofwithdrawals

EPS post-demerger will purchase 100% ofthe Company from current shareholders

Guido Cami will reinvest part of the proceeds fromthe sale of his stake in ICF. Other managers willinvest in the capital increase. The total investment ofCami and the management amounts to ca. €2.2 m.Private Equity Partners will reinvest all theproceeds from the sale of its stake (ca. €2.9 m) inthe capital increase

Demerger of

EPS2 from

EPS

Acquisition

of ICF

Capital

increase

1

2

3

EPSEQUITA PEP SPAC

Demerger (1)

33

Notes: (1) Base case, assuming no withdrawals from market investors

Ordinary shares, Special shares and financial resources will be split between EPS and the newly-formed

EPS2

1

EPSEQUITA PEP SPAC



• 20% of Special shares will be sold to the

management of ICF by EPS Sponsors

• Demerger ratio: 1 EPS2 share each 1.8400 EPS

shares(1)

• NAV: €70.1 m



• NAV: €83.4 m

EPSEQUITA PEP SPAC

Demerger

EPSEQUITA PEP SPAC

Acquisition of Industrie Chimiche Forestali S.p.A.

34

Note: (*) After closing, EPS will be renamed «ICF Group»

EPS will buy the 100% of the Company from current shareholders for a total consideration of €69.1 m

2

Current

shareholders

of ICFEPSEQUITA PEP SPAC

100% stake

€69.1 m

Group structure before the acquisition… …and after the acquisition

Mandarin

Progressio

PEP S.p.A.

Guido Cami

Others

Forestali de Mexico

51.0% 4.2%

4.2%

1.4%

39.3%

99.8%

EPSEQUITA PEP SPAC

Forestali de Mexico

99.8%

100%

*

EPSEQUITA PEP SPAC

Capital Increase by the Management and Private Equity Partners

35

Notes: (1) Based on ordinary shares (2) The computation includes the number of ordinary shares resulting from the conversion of Special

shares at Business Combination (*) After closing, EPS will be renamed «ICF Group»

The Management and Private Equity Partners will inject new financial resources in the Group for future

development

3

EPSEQUITA PEP SPAC

Forestali de Mexico

99.8%

100%

• Guido Cami (CEO) – together with other managers of the

Company – (the “Management”) and Private Equity

Partners will purchase newly-issued shares of EPS in order

to provide additional capital for the development of the

Forestali Group. In particular:

• The Management will invest around €2.2 m

• Private Equity Partners S.p.A. will invest around

€2.9 m, which is just above the entire amount of

proceeds deriving from the sale of its stake in ICF

• The Management will also purchase 36,522 Special

shares (equal to 20% of EPS demerged) held by the

Sponsors, in a perspective of full alignment of interests

with shareholders

• Lock-up clause: 36 months for the Management, including

the CEO Guido Cami, and Private Equity Partners

Market

Sponsors (2)

Management

ICF (2)

PEP

90.8% 3.4%

3.8%1.9%

Shareholding structure(1)

*

EPSEQUITA PEP SPAC

Alternative Scenarios at Business Combination

36

Note: (1) Based on Ordinary shares oustanding and on a value of EPS shares of €10 per share (2) Net of operating costs and transaction

costs incurred in by EPS up to Business Combination (*) After closing, EPS will be renamed «ICF Group»

EPSEQUITA PEP SPAC

Market Cap @ BC (post capital increase)(1): € 75 mln

Purchase Price: € 69.1 mln (2)

• Base Case: No withdrawal

NAV @ BC: €83.4 mln

Demerger ratio: 1 EPS2 share for each 1.8400

EPS shares, for both Ordinary shares and

Special shares

• Alternative Case: Maximum withdrawal

Withdrawn shares: 4,499,999

Withdrawal price: €10

Cost of withdrawal: €45 mln

NAV @ BC: €38.4 mln

Demerger ratio:

‒ 1 EPS2 Ordinary share for each 2.8750 EPS

Ordinary shares residual after withdrawal

‒ 1 EPS2 Special share for each 1.8400 EPS

Special shares

*

EPSEQUITA PEP SPAC

Next Steps

37

January February March April

2018

19th January 2018

Signing of the SPA and ancillary

documents

Board of Directors of EPS to

approve, among others:

• the Business Combination

• the demerger of EPS 2

• the capital increase

• the transfer of Special Shares

• the calling of the

Shareholders’ meeting

26th February 2018

Shareholders’ meeting to

approve, among others:

• the authorization to

proceed with the

Business Combination

• the demerger for EPS 2

• the transfer of Special

Shares

• the capital increase

28th February –

15th March 2018

Period for the

exercise of the

withdrawal right by

EPS shareholders

17th March – 15th April

2018

Period for the exercise

of the option to

purchase withdrawn

shares by remaining

shareholders

27th April 2018

Closing of:

• Business

Combination

• Capital Increase

• Transfer of Special

Shares

Within 12th

January 2018

Constitution of

the beneficiary

company

(“EPS 2”)

19th January 2018

Board of Directors of

EPS 2 to approve:

• the demerger

• the calling of the

Shareholders’

meeting

26th February 2018

Shareholders’ meeting of EPS 2

to approve, among others:

• Request for admission to

trading on AIM market

• The demerger and the related

capital increase

20th April 2018

Filing of the

Admission

Document of

EPS 2

24th April 2018

Admission to

trading by Borsa

Italiana of EPS 2

EPSEQUITA PEP SPAC

Board of Directors at Business Combination

38

Note: (*) After closing, EPS will be renamed «ICF Group»

Fabio Sattin

Chairman of the Board

Stefano Lustig

Vice-chairman of the Board

Giovanni Campolo

CEO

Rossano Rufini

CEO

Fabio Buttignon

Independent Director

Stefano Caselli


Paola Giannotti de Ponti


EPSEQUITA PEP SPAC

Guido Cami

Chairman of the Board

Giovanni Campolo

Director

(Specific mandate on

Corporate Development)

Rossano Rufini

Director

The Board of Directors of EPS will be represented by up to

9 members. Guido Cami will be co-opted by EPS Board

and mandates of current directors will be reviewed

The Board will have 3 directors, two of which nominated

by the holding company EPS

ICF Board of Directors at ClosingCurrent EPS Board of Directors

*

Index

EPSEQUITA PEP SPAC

1. Company Overview





6. The Transaction

7. Appendix

EPSEQUITA PEP SPAC

Sales Network of the Forestali Group

40

Note: (1) As of 30/11/2017


• 9 sales managers

• 35 agents / distributors

CEO coordinates a network of internal commercial

directors allocated by clients / regions coupled with

external agents and distributors

Overview of the commercial network (1) List of agents / distributors by geographic area

Geographic area #

Italy 14

Rest of Europe and Russia 6

Africa 3

Middle East 1

Asia 6

America 1

ABC Packaging 4

Total 35

All agents and distributors are external with an agency

contract based on commissions

6 sales managers

31 agents /

distributors

3 sales managers

• 2 Automotive

• 1 Packaging

4 agents / distr.

• Packaging

The sales organization is made up of sales managers and a network of external agents and distributors. The latter

is key to succeed in serving the fragmented customer base of the Footwear and Leather Goods business

EPSEQUITA PEP SPAC

Focus on Adhesives

41

Note: (1) Solvents include: Acetone, Ethyl Acetate, Methyl Ethyl Ketone (MEK), Cyclohexane

Source: Euromonitor, ICF Information

Water-based glue is more and more preferred to solvent-based for production process sustainability, even

though solvent-based consumption is expected to increase, especially in Asia

World solvent(1) consumption (Mln/ton) Solvent-based vs Water-based adhesives

9.19.3 9.4

9.69.8

1010.3

2014 2015 2016 2017 2018 2019 2020

CAGR ‘16-’20:

Asia Europe RoW

2.9% 0.9% 2.1%

So

lve

nt-

ba

se

d

ad

he

siv

es

Fast solvent evaporation

Ease of use

Storage and usage require safety measures to be

adopted

Wa

ter-

ba

se

d

ad

he

siv

es

• The tendency to prefer water-based glue is already widespread

• Players are not price sensitive since the glue is mission critical

It does not require safety measures to be adopted

Environment-friendly

Slow water evaporation / controlled temperature and

humidity

Requires surface preparation in order to glue effectively

Short shelf life

Source: Euromonitor

EPSEQUITA PEP SPAC

Different Types of Adhesives

42


Solvent-based

adhesives

Water-based

adhesives

Solvent-free

adhesives

• Mixture of solid ingredients dissolved in a mix of solvents (e.g. polyurethane adhesive in

ethyl acetate, based on aromatic isocyanates; polychloroprenic adhesive; vynilic

adhesive; synthetic rubber adhesive)

Fast drying and highly effective

Its storage and usage require safety measures to be adopted

• Mixture of solid ingredients (e.g. polychloroprene; additives catalysts; polyurethanic;

vynilic; natural rubber; synthetic rubber) dissolved in water

It does not contain solvents

It does not require safety measures to be adopted

It is sensitive to low and high temperatures

Short shelf life

• Mixture of polyols and MDI isocyanate (e.g. one and two component polyurethane

adhesive based on aromatic isocyanates; polyamide hot melt adhesive; polyester hot

melt adhesive)

It does not contain solvent nor water, so it does not need to evaporate

It is a long polymer chain, so it is not flexible. It is mainly used for rigid products

EPSEQUITA PEP SPAC

Achieved

Environmental Programme

43

Note: (1) Volatile Organic Substances


Forestali is engaged in minimizing the impact of its activities on the environment and improving the quality of

the workplace

2013-2015 Programme 2015-2018 Programme

LCA study on toe puff made by biological polymer with a reduction of 10% of CO2 emission: year 2012

reduction of dustiness in adhesive production during loading phase of rubbers and resins. Local suction during loading phase of mixing: years 2013 (-30%)

VOS(1) reduction released from emission point E1. VOS combustion and emission only CO2: year 2013

reduction of industrial waste: -10% of years 2014

paving waste storage area: year 2015

ICF is now planning “Forestali 4.0”, a revamping project that will improve the efficiency of the production plants and reduce the

environmental impact

reduction to electric energy consumption for lighting

hazardous substances are replaced by substances not dangerous

uptake to well water less deep

reduction of energy consumption, emissions and waste

reduction of fugitive emissions

In progress

EPSEQUITA PEP SPAC

Key Drivers for growth in the Footwear Sector

44

Source: World Footwear Yearbook 2017; OECD; World Bank

GDP and population growth for the main consumer countries are identified as key drivers of growth in the

sector

Production by quantity until today Future macro estimates

Estimated Real GDP growth (annual %)

20.0

21.221.5

22.623.1 23.0 23.1

2010 2011 2012 2013 2014 2015 2016

World footwear production (bn pairs)

0.7%1.0% 1.0% 0.8%

2015 2016 2017 2018

Italy

6.9%6.7% 6.6%

6.4%

2015 2016 2017 2018

China

2.6%1.6% 2.1% 2.4%

2015 2016 2017 2018

United States

7.9%

7.1% 7.3%7.7%

2015 2016 2017 2018

India

4.9% 5.0% 5.1% 5.2%

2015 2016 2017 2018

Indonesia

(3.8%) (3.6%)

0.7% 1.6%

2015 2016 2017 2018

Brazil

3.2% 3.0%3.5% 3.6%

2015 2016 2017 2018

World

Population growth forecast (CAGR ‘16-18)

0.4% 0.7%

1.2% 1.1%

0.8% 1.1%

-0.1%

EPSEQUITA PEP SPAC

Overview of the Footwear Sector in the World

45

Source: World Footwear Yearbook 2017; OECD; World Bank

The footwear production is largely driven by China, with the most important end markets being China, US and

India

World footwear production… …and end markets

2%

5%

North

America

South

America

2%Africa

4%Europe

87% Asia

0% Oceania

15%

7%

North

America

South

America

7%Africa

16%Europe

54% Asia

1% Oceania

57.4%

9.6%

5.2% 4.9% 4.2%

China India Vietnam Indonesia Brazil

World market share (%) by quantity

Top 5 global producers by quantity Top 5 global consumers by quantity

18.3%

10.8% 10.6%

4.1% 4.0%

China USA India Indonesia Brazil

World market share (%) by quantity

EPSEQUITA PEP SPAC

Application of Adhesives and Fabrics in Footwear Products

46


Adhesives and fabrics are widely used in the manufacturing of several types of shoes. Their utilization also

depends on the quality and the type of shoe

Sport shoes

Dress shoes

Open toe

shoes

Vulcanizing

shoes

Adhesiveless shoes

Adhesives

• Used to put together

several parts of the shoe,

varying according to the

type of shoe

• Generally, adhesives are

more abundant in high-end

shoes, given their

importance in terms of

perceived quality

Fabrics

• Used for different types of

shoes, according to their

purpose

• Likewise adhesives, they

are less used in very low-

end shoes for cost savings

purposes

UpperInsoleSole Unit

Upper

Insole

Midsole

Outsole

Upper

Sole Unit

Insole Sponge

Insole Filler

Filler Sole

Foxing Tape

EPSEQUITA PEP SPAC

Leather Goods & Upholstery Sectors

47

Source: Altagamma, Euromonitor, market estimate

The leather goods and upholstery sectors have registered a constant growth in the last 6 years and are

expected to grow by 5% and 3.5% annually from 2016 until 2020, pushed by global trends

Global leather luxury goods (€ bn) Global upholstery (€ bn)

28.0

34.036.0 37.0

43.0 44.046.1

48.450.8

53.2

2011 2012 2013 2014 2015 2016 2017E 2018E 2019E 2020E

264 263 266278

288299

309320

331343

2011 2012 2013 2014 2015 2016 2017E 2018E 2019E 2020E

The global leather luxury goods grew by 9.5% annually

since 2011, with expected growth opportunities in the future

thanks to globalization

Upholstery production grew by 2.5% annually since 2011

and is expected to grow further, pushed by rising global

purchasing power

EPSEQUITA PEP SPAC

What’s Next? M&A Opportunities…

48

Note: (1) Adjusted for extraordinary outflow given by leverages in December 2013 and January 2016 (2) Based on the number of ordinary

shares (3) The computation includes the number of ordinary shares resulting from the conversion of Special shares at Business Combination


Strong cash flow generation, a spreading share ownership and strategic advisory provided by EPS

management team will further strengthen ICF positioning in the M&A landscape

Cash flow generation

Total Adj. cash flow generation(1) for the period 2012 – 2016

amounts to €26.7 m

Shareholding structure(2) after the BC

Being a public company opens up to stock-for-stock targeted

acquisitions to broaden the product portfolio and served markets

2.7

3.4

5.4

6.3

8.9

2012

2013

2014

2015

2016

Adj. FCF (€m)

Average

2012-2016

€4.6 m

The strong cash flow generation and the fragmented ownership structure will increase the number of strategic opportunities

that the ICF top management can choose from to further expand the business

90.8%

3.8%

3.4% 1.9%

Market

Private EquityPartners

Management

Sponsors EPS

(3)

(3)


EPSEQUITA PEP SPAC

…With High Potential for Consolidation

49

Source: press releases, Mergermarket, Bloomberg

The average EV/EBITDA multiple paid in selected M&A deals in the Adhesive sector is 12x

Closing date 03/02/2015 01/06/2015 01/12/2016 03/01/2017 17/05/2017 01/09/2017 22/10/2017 06/11/2017

Target Bostik Novamelt Den Braven

Wisdom

Worldwide

Adhesives

Sonderhoff DowDuPontRoyal Adhesives

& SealantsAdecol

Bidder Arkema Henkel Arkema H.B. Fuller Henkel DuPont / Dow H.B. Fuller H.B. Fuller

11.0x

13.8x

11.1x 11.1x

n.a.

13.3x

11.4x

n.a.

12,0x

EV/EBITDA Media EV/EBITDA

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