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- 18:09 CEST

Tender Offer Document published

  • Purchase price per share: Euro 0.51.
  • Acceptance period: from 8:30 a.m. on June 21, 2021 to 5:30 p.m. on July 29, 2021, inclusive.
  • Payment date of the purchase price: August 6, 2021.
  • Approval by the Board of half-year financial results anticipated to July 26, 2021.

Milan, June 17 2021 – With reference to the voluntary partial public tender offer launched by CIR S.p.A. – Compagnie Industriali Riunite (“CIR” or the “Offeror” or the “Issuer”) pursuant to Articles 102 and following of Legislative Decree no. 58 of February 24, 1998, as amended and supplemented (“TUF”), for a maximum number of 156,862,745 shares with no par value, referred to in the press release issued on May 10, 2021 by CIR in its capacity as offeror (the “Tender Offer”), notice is hereby given that Consob, by resolution no. 21898 of June 15, 2021, approved the tender offer document relating to the Tender Offer filed with Consob on May 31, 2021 and re-filed on June 10, 2021 and on June 14, 2021 (the “Tender Offer Document”) pursuant to Article 102, fourth paragraph, of the TUF.

Please also note that the Tender Offer Document, containing a detailed description of the terms and conditions of the Tender Offer as well as – among other things – the procedures for accepting the Tender Offer, is published today and made available to the public, together with the acceptance form, for consultation (i) at the registered office of CIR at Via Ciovassino 1, 20121 Milan; (ii) at the registered office of UniCredit Bank AG, Milan Branch (in its capacity as intermediary appointed to coordinate the collection of acceptances) at Piazza Gae Aulenti 4, Tower C, 20154 Milan; (iii) on the website of CIR (www.cirgroup.it in the dedicated area “Governance/Voluntary partial public tender offer”) and (iv) at the registered offices of BNP Paribas Securities Services – Succursale di Milano, EQUITA SIM S.p.A. Intermonte SIM S.p.A., SGSS S.p.A. (as appointed intermediaries).

Please also be aware that, in view of the fact that the Tender Offer is promoted by CIR and that therefore there is coincidence between the Offeror and the Issuer, the Tender Offer Document does not include a statement of the Issuer pursuant to Article 103, paragraph 3, of the TUF and Article 39 of the Rules for Issuers.

The main elements of the Tender Offer, as more extensively described in the Tender Offer Document, are set out below.

Shares subject to the Tender Offer. The maximum number of 156,862,745 CIR shares, with no par value, listed on the Italian Stock Exchange (Mercato Telematico Azionario), equal to 12.282% of the share capital of CIR. All the shares (identification codes: (i) ISIN IT0000070786, (ii) XXITV0000172, (iii) XXITV0000180 and (iv) ISIN IT0005241762), with the exclusion of the 26,708,861 treasury shares held by CIR as of the date of the Tender Offer Document, equal to 2.091% of the share capital of CIR. Please be aware that the maximum number of shares subject to the Tender Offer could be reduced, as a consequence of the direct and/or indirect purchase by the Offeror, of shares outside of the Tender Offer in accordance with the terms of Articles 41, paragraph 2, and 42, paragraph 2, of the Rules for Issuers.

Purchase price. The purchase price, equal to Euro 0.51 per share, will be paid to the tendering shareholders on the sixth trading day following the end of the acceptance period, i.e. on August 6, 2021 (unless extended), against the simultaneous transfer of full ownership of the tendered shares. Should all the no. 156,862,745 be tendered in the Tender Offer, the overall disbursement will be equal to Euro 80 million.

Conditions for the effectiveness of the Tender Offer. The effectiveness of the Tender Offer is subject to (A) the non-occurrence, by the first trading day following the end of the acceptance period, of (i) extraordinary events or situations at a national and/or international level involving serious changes in the political, financial, economic, currency or market situation not already determined as at the date of publication of the Tender Offer Document and that have a materially detrimental effect on the Tender Offer, on the conditions of the business and/or on the economic and/or financial conditions (ii) acts, facts, circumstances, events or situations not already determined as at the date of publication of the Tender Offer Document and such as to have a materially detrimental effect on the Tender Offer, on the terms and conditions of the business and/or on the equity, economic or financial position of CIR and/or the CIR Group, as resulting from the consolidated financial statements for the year 2020 and/or (B) the non-adoption and/or non-publication, by the first trading day after the end of the acceptance period, by institutions, bodies or authorities having jurisdiction, of any legislative, administrative (including tender offer obligations under Articles 106 and following of the TUF) or judicial act or measure that would preclude, limit or make more onerous, in whole or in part, even on a transitional basis, the possibility for CIR and/or the CIR Group to carry out the Tender Offer. The Offeror may waive, or modify in terms, at any time and at its sole discretion, all or part of the conditions for the effectiveness of the Tender Offer within the limits and according to the procedures set out in Article 43 of the Rules for Issuers. The Tender Offer is not conditional on reaching a minimum number of acceptances.

Acceptance period. Pursuant to article 40, second paragraph, of the Rules for Issuers, the acceptance period for the Tender Offer, agreed with Borsa Italiana S.p.A., will start at 8:30 a.m. on June 21, 2021 and will end at 5:30 p.m. on July 29, 2021, inclusive, unless extended. July 29, 2021 will therefore be the last day to accept the Tender Offer, unless extended. Furthermore, CIR decided to anticipate the approval and publication of half year 2021 consolidated financial results to July 26, 2021 (initially scheduled on July 30, 2021), to provide shareholders with such information before the end of the acceptance period (a separate press release has been issued today for the modification of the CIR corporate events calendar).

Allotment. In the event that the total number of shares tendered to the Tender Offer exceeds the maximum number of shares subject to the Tender Offer, the shares will be allotted according to the “pro-rata” method, on the basis of which the Offeror will acquire from all shareholders the same proportion of shares tendered to the Tender Offer. If the shares tendered to the Tender Offer by a single shareholder are identified by different identification codes, in order to protect the positions accrued in relation to the possibility to exercise the multiple voting rights, the shares will be allotted to the Offeror from each tendering shareholder in the following order of priority (i) in the first place, the shares identified by ISIN code IT0000070786 will be allotted to the Offeror; (ii) secondly, the shares awaiting registration in the permanent shareholders’ register of CIR, identified by code XXITV0000172, will be allotted to the Offeror; (iii) thirdly, the shares entered in the stable shareholders’ register of CIR and awaiting the vesting of the multiple vote, identified by the code XXITV0000180, will be allotted to the Offeror; (iv) fourthly, the shares with multiple vote, identified by the ISIN code IT0005241762, will be allotted to the Offeror. It is understood that, should the shares be returned to the tendering shareholders in the event of allotment, such shareholder shall be entitled to be given back shares with the same rights and/or faculties that they would have had if they had not tendered the shares.

Disclaimer. The Tender Offer is being made exclusively on the Italian stock exchange, the only market on which CIR’s shares are listed, and is addressed, indiscriminately and under the same conditions, to all the shareholders of the Issuer with the exception of the Issuer itself. The Tender Offer has not been and will not be promoted or disseminated in the United States of America, Canada, Japan and Australia, as well as in any other country in which such dissemination is not permitted without authorisation from the competent authorities or is in breach of local rules or regulations (the “Other Countries”), nor by using instruments of communication or international commerce (including, by way of example, the postal network, fax, telex, e-mail, telephone and internet) of the United States of America, Canada, Japan, Australia or of the Other Countries, nor through any structure or structure of the Tender Offer, including, without limitation, by post, facsimile, telex, electronic mail, telephone and internet) of the United States of America, Canada, Japan, Australia or the Other Countries, or through any facility of any financial intermediary of the United States of America, Canada, Japan, Australia or the Other Countries, or in any other manner. Copies of this press release, the Tender Offer Document, or portions thereof, as well as copies of any subsequent documents that the Offeror will issue in connection with the Tender Offer, are not and shall not be sent, nor in any way transmitted, or in any way distributed, directly or indirectly, in the United States of America, in Canada, in Japan, in Australia or in the Other Countries. Any person receiving the above documents shall not distribute, send or ship them in any way in the United States of America, Canada, Japan, Australia or the Other Countries. The Tender Offer Document does not constitute and shall not be construed as a tender offer addressed to persons residing in the United States of America, Canada, Japan, Australia or in the Other Countries. Subscription to the Tender Offer by persons residing in countries other than Italy may be subject to specific obligations or restrictions provided for by laws or regulations. It is the sole responsibility of the addressees of the Tender Offer to comply with such rules and, therefore, before accepting the Tender Offer, to verify their existence and applicability by contacting their consultants. Subscriptions to the Tender Offer in breach of the above limitations will not be accepted.

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- 09:55 CEST

Tender Offer Document approved by CONSOB

Milan, June 16 2021 – CIR S.p.A. – Compagnie Industriali Riunite (“CIR” or  the “Offeror”) informs that Consob, with resolution no. 21898 of June 15 2021, pursuant to Article 102, paragraph 4, of Legislative Decree no. 58 of February 24, 1998, as amended and supplemented (“TUF”), approved the tender offer document (the “Tender Offer Document”) for the voluntary partial public tender offer (the “Tender Offer”) launched by CIR on a maximum number of 156,862,745 shares of CIR (the “Shares”). Pursuant to Article 40, paragraph 2, of the Rules for Issuers, the period of acceptance, agreed with Borsa Italiana S.p.A., will begin on June 21, 2021 at 8:30 am and will end on July 29, 2021 at 5:30 pm, inclusive (unless extended). The payment date of the purchase price, equal to Euro 0.51 per Share tendered to the Offer, will fall on August 6, 2021. The publication and the dissemination of the Tender Offer Document will be the subject of a subsequent press release pursuant to Article 38, paragraph 2, of the Rules for Issuers.

Disclaimer. The Tender Offer is being made exclusively on the Italian stock exchange, the only market on which CIR’s shares are listed, and is addressed, indiscriminately and under the same conditions, to all the shareholders of the Issuer with the exception of the Issuer itself. The Tender Offer has not been and will not be promoted or disseminated in the United States of America, Canada, Japan and Australia, as well as in any other country in which such dissemination is not permitted without authorisation from the competent authorities or is in breach of local rules or regulations (the “Other Countries”), nor by using instruments of communication or international commerce (including, by way of example, the postal network, fax, telex, e-mail, telephone and internet) of the United States of America, Canada, Japan, Australia or of the Other Countries, nor through any structure or structure of the Tender Offer, including, without limitation, by post, facsimile, telex, electronic mail, telephone and internet) of the United States of America, Canada, Japan, Australia or the Other Countries, or through any facility of any financial intermediary of the United States of America, Canada, Japan, Australia or the Other Countries, or in any other manner. Copies of this press release, the Tender Offer Document, or portions thereof, as well as copies of any subsequent documents that the Offeror will issue in connection with the Tender Offer, are not and shall not be sent, nor in any way transmitted, or in any way distributed, directly or indirectly, in the United States of America, in Canada, in Japan, in Australia or in the Other Countries. Any person receiving the above documents shall not distribute, send or ship them in any way in the United States of America, Canada, Japan, Australia or the Other Countries. The Tender Offer Document does not constitute and shall not be construed as a tender offer addressed to persons residing in the United States of America, Canada, Japan, Australia or in the Other Countries. Subscription to the Tender Offer by persons residing in countries other than Italy may be subject to specific obligations or restrictions provided for by laws or regulations. It is the sole responsibility of the addressees of the Tender Offer to comply with such rules and, therefore, before accepting the Tender Offer, to verify their existence and applicability by contacting their consultants. Subscriptions to the Tender Offer in breach of the above limitations will not be accepted.

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- 18:54 CEST

Tender Offer Document has been filed with CONSOB

Milan, May 31 2021 – With reference to the voluntary partial public tender offer launched by CIR S.p.A. – Compagnie Industriali Riunite (“CIR” or the “Company”), as per the terms of Articles 102 onwards of Legislative Decree no. 58 of February 24 1998 as subsequently amended and supplemented (“TUF”), to buy back a maximum of 156,862,745 CIR shares without indication of a nominal value, fully freed up (the “Shares”), listed on the Mercato Telematico Azionario organized and managed by Borsa Italiana S.p.A., all as stated in the press release issued on May 10 2021 by the Company as the Offeror, it is hereby announced that today CIR has filed with CONSOB the documentation relating to the offer in accordance with Article 102, paragraph 3, of the TUF and with Article 37-ter of the Rules for Issuers.

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- 21:53 CEST

Voluntary public tender offer launched by CIR S.p.A. to buy back part of the shares of CIR S.p.A.

DISCLOSURE AS PER THE TERMS OF ARTICLES 102 OF LEGISLATIVE DECREE NO. 58 OF FEBRUARY 24 1998 AS SUBSEQUENTLY AMENDED (THE “TUF”), ARTICLE 37 OF THE RULES ADOPTED BY CONSOB WITH RESOLUTION NO. 11971 OF MAY 14 1999 AS SUBSEQUENTLY AMENDED AND SUPPLEMENTED (THE “RULES FOR ISSUERS”) AND ARTICLE 17 OF EU REGULATION NO. 596 OF APRIL 16 2014 (“MAR”).

VOLUNTARY PUBLIC TENDER OFFER LAUNCHED BY CIR S.P.A. TO BUY BACK PART OF THE SHARES OF CIR S.PA.

Milan, May 10 2021. As per the terms and effects of Article 102, paragraph 1, of the TUF and of Article 37 of the Rules for Issuers, CIR S.p.A. (the “Offeror” or the “Issuer” or “CIR” or the “Company”) announces its decision, approved today unanimously by the Board of Directors, to launch a voluntary public tender offer to buy, in accordance with the terms of Articles 102 and following articles of the TUF, a maximum of 156,862,745 shares of CIR S.p.A., shares without an indication of nominal value, fully freed up (the “Shares”), listed on the Mercato Telematico Azionario (“MTA”) organized and managed by Borsa Italiana S.p.A. (“Borsa Italiana”), equal to 12.282% of the share capital of CIR (the “Offer”).

The Offer is aimed without distinction at all holders of CIR shares and does not apply to the 26,708,861 own shares currently held by the Issuer, corresponding to 2.091% of its share capital, which are therefore excluded from the Offer.

The Offer is not subject to reaching a minimum number of subscriptions.

The Shares bought back by CIR under this Offer will not be subject to cancellation.

If the Offer is accepted for a number of shares in excess of the maximum number of Shares contained in the same Offer, the shares will be allocated proportionally so that CIR will buy the same percentage of the Shares being offered from each Shareholder taking part in the Offer as that of their original holding.

Pursuant to the terms of Article 102, paragraph 3, of the TUF, the Offeror will, within twenty days of this disclosure, send Consob the offer document (the “Offer Document”) for publication, and reference should be made to this document for further details of the Offer.

Below are the essential elements of the Offer and the purposes that it aims to achieve.

OFFEROR – ISSUER AND CONTROLLING ENTITY

OFFEROR – ISSUER

As the Offer is being launched by CIR, the issuer of the shares included in the Offer, the Offeror and the Issuer are the same entity.

CIR is a società per azioni (a public limited company) according to Italian law, with its registered office in Milan, Via Ciovassino 1, tax code, IVA number and registration number on the Milan Monza Brianza and Lodi Register of Companies: 01792930016, registered with the Milan R.E.A. as no. 1950090, a company active, even through its subsidiaries, in the sector of acquiring and managing controlling equity interests and financial assets.

The duration of the Company was established as until December 31 2050.

As of the date of this press release, the share capital of the Issuer stands at Euro 638,603,657, fully subscribed and paid up, and consists of 1,277,207,314 ordinary shares without indication of a nominal value.

CIR’s Company Bylaws provide for increased voting rights as per the terms of Art. 127-quinquies of the TUF; more specifically, Art. 8, as amended by the Extraordinary General Meeting held on April 29 2019, establishes that each share gives the right to two votes when all of the following conditions are met with: a) the same person or entity has had the voting entitlement on the strength of a real right giving such entitlement (full ownership with voting right, bare ownership with voting right or usufruct with voting right) for a continuous period of not less than 48 months; b) the presence of the condition as per a) above is attested by the continuous registration, for a period of no less than 48 months, in the list contained in the Stable Shareholders Book, specially set up for this purpose, which is held and updated by the Company.

The chart below shows the composition of the capital and voting rights published on May 4 2021, without prejudice to any updates in the supplementary document.

CIR’s ordinary shares are listed for trading on the MTA platform.

As of today, the Issuer has not issued any other categories of shares or bonds convertible into shares.

The chart below gives the figures relating to the main Shareholders of CIR (with interests equal to or above 5% of the share capital) based on the Shareholders Book and other information available to the Issuer as of the date of this disclosure.

No other parties are acting in conjunction with the Offeror in relation to the Offer and it should be noted that Rodolfo De Benedetti, Chairman of the Board of Directors of the Company and Chairman of the Board of Directors of its parent company F.LLI DE BENEDETTI S.p.A., directly and indirectly owns 16,497,569 shares and 16,497,569 voting rights of the Company (1.292% of the share capital, 0.974% of the voting capital and 0.963% of the voting rights as per Art. 44 bis , paragraph 4, letter b) of the Rules for Issuers, hereinafter, for the sake of brevity, “Percentage for the purposes of mandatory OPA”).

CONTROLLING ENTITY

As of the date of this disclosure, control of CIR as per the terms of Article 93 of the TUF is exercised by FRATELLI DE BENEDETTI S.p.A. («FDB»), with registered office in Turin, Via Valeggio. 41, a share capital of Euro 170,820,000 fully paid up, tax code and registration number on the Turin Register of Companies 05936550010.

The controlling shareholder as above owns 30.759% of the share capital and 45.256% of the voting capital (44.736% in terms of percentage for the purposes of mandatory OPA).

The controlling Shareholder has notified the Issuer of its intention not to accept the Offer.

It should be noted that on March 16 2021 a shareholder agreement (the “Agreement”), currently valid, was signed by Rodolfo De Benedetti, Marco De Benedetti, Edoardo De Benedetti (“Shareholders”), FDB and Margherita Crosetti, and contains clauses relevant to the terms of Art. 122, paragraphs 1 and 5, letters a), b), and c), of the TUF, regarding the shares of (i) FDB, controlling shareholder of the Offeror, and of (ii) CIR, i.e. the Offeror.

The Agreement binds the Shareholders, who together own 100% of the share capital of FDB, as well as Margherita Crosetti, as holder of usufruct with voting rights on part of the shares of FDB, and FDB itself, as holder of CIR shares.

The essential information regarding the Agreement was published, pursuant to Art. 130 of the Rules for Issuers, on the CIR website www.cirgroup.it, in the Governance section under Shareholder Agreements.

As far as CIR is aware, there are no other shareholder agreements relevant to the terms of Article 122 of the TUF concerning CIR shares.

CATEGORIES AND NUMBER OF SHARES PERTAINING TO THE OFFER

The Offer is aimed without distinction and at equal conditions to all shareholders of the Issuer and regards a maximum of 156,862,745 ordinary CIR shares, without a nominal value, with regular dividend rights, listed on the MTA, and which account for 12.282% of the share capital of CIR.

The Shares for which the Offer is accepted must be freely transferable to the Offeror and must be free of all constraints and any kind of real, obligatory or personal encumbrance.

As of the date of publication of this disclosure, CIR is holding 26,708,861 own shares representing 2.091% of the share capital, which are not included in the Offer.

In the event of the Offer being fully accepted and taking into account the shares already held by the Issuer in its portfolio as of today, CIR will own 183,571,606 own shares, corresponding to 14.373% of the share capital of the Issuer and thus a number of shares amounting to less than one fifth of the share capital.

It should be pointed out that if a holder of shares with increased voting rights should accept the offer for just a part of the said shares, the remaining shares in his or her possession will continue to have increased voting rights as per the terms of the law and of the Bylaws.

UNIT PRICE OFFERED AND TOTAL VALUE OF CIR’S OFFER

The Offeror will pay to each party who accepts the Offer a price of Euro 0.51 for each Share that accepts the Offer and is purchased (the “Price”).

The Price is to be understood as net of stamp duty, registration tax and the Italian tax on financial transactions, where due, and of any fees, commissions, withholding tax or substitute tax, where due, on the capital gain that may be realized, which will be the responsibility of those who accept the Offer.

The Price includes a premium of 2.78% over the official price of CIR ordinary shares recorded on May 7 2021 (the Stock Exchange trading day prior to the date on which the transaction is being disclosed to the market), and a premium of 7.10%, 5.76%, 9.49%, and 17.68% over the weighted average of the official prices of the shares of the Issuer in the periods of 1 month, 3 months, 6 months and 12 months prior to May 7 2021 respectively, as illustrated more effectively in the chart below.

The total consideration for the 156,862,745 Shares of the Offer is Euro 80,000,000.

Payment of the consideration to the persons or entities who accept the Offer with the transfer of ownership of the Shares being offered to the Offeror will take place on the fifth Stock Exchange trading day after the close of the period for accepting the Offer agreed upon with Borsa Italiana (the “Acceptance Period”), without prejudice to any deferrals or amendments to the Offer that could arise to comply with current requirements of law or regulations.

REASONS FOR THE TENDER OFFER

The Offer was drawn up taking the following circumstances into account: (i) the Company has for years had a considerable liquidity position; (ii) in 2020 the Company sold one of its controlling interests which, on the one hand, significantly increased its liquidity and, on the other hand, reduced the number of sectors in which it is present and thus its potential needs and/or investment opportunities; (iii) currently, the Company has liquidity in excess of its short and medium term investment programmes, given that its subsidiaries are able to self-finance their development; (iv) the Company has a significant amount of distributable reserves which are in any case sufficient for the transaction at the analysis stage.

The Offer would enable shareholders who intend to accept it – with equal conditions for all – to benefit from a temporary increase in the liquidity of their investment at a price that is certain and that would contain a premium over the average prices of the share in recent months.

For shareholders who decide not to accept the Offer, the buyback of own shares by the Company resulting from acceptance of the Offer would lead to an increase in the earnings per share (EPS) and the dividend per share, provided the total earnings remain unchanged. This would be the case even if the own shares bought back were not cancelled but remained in the Company’s portfolio because the dividend rights of own shares are allocated pro rata to the other shares, as per the terms of Art. 2357-ter, second paragraph, of the Civil Code.

From the Company’s viewpoint, the Offer can be considered a prudent investment of liquidity; indeed (i) the investment would be made a lower value than the intrinsic value of the shares and (ii) as long as the shares are kept in the portfolio, their purchase would not reduce the Company’s financial resources permanently as they could be used for possible acquisitions and/or the development of alliances.

INTENTION OF DELISTING THE FINANCIAL INSTRUMENTS OF THE OFFER

OBLIGATION TO BUY BACK SHARES AS PER THE TERMS OF ARTICLE 108, PARAGRAPH 2 OF THE TUF

The Offer consists of a voluntary partial public tender offer launched pursuant to Articles 102 and following articles of the TUF and is not aimed at, nor will it result in, the withdrawal of the ordinary shares of the Issuer from their listing on the MTA (delisting).

Therefore, in view of the nature of the Offer, the conditions for an obligatory buyback as per the terms of Article 108, paragraph 2, of the TUF do not exist.

RIGHT TO BUY BACK SHARES AS PER ARTICLE 111 OF THE TUF AND OBLIGATION TO BUY BACK SHARES AS PER ARTICLE 108, PARAGRAPH 1, OF THE TUF

The Offer is a voluntary partial tender offer launched in accordance with Articles 102 and following articles of the TUF and does not have the aim of delisting the ordinary shares of the Issuer from trading on the MTA market.

Therefore, in view of the nature of the Offer, the conditions do not exist either for the right to buy back own shares as per Article 111 of the TUF or for the obligation to buy back own shares as per Article 108, paragraph 1, of the TUF.

NON-APPLICABILITY OF THE OBLIGATION TO LAUNCH AN INCREMENTAL BUYBACK OF SHARES AS PER ARTICLE 106, PARAGRAPH 3, LETTER B), OF THE TUF AND ARTICLE 46 OF THE RULES FOR ISSUERS

The controlling shareholder FDB owns 392,851,536 CIR shares, representing 30.759% of the share capital of the Issuer and 45.256% of the voting rights that can be exercised at the General Meetings of the Shareholders (44.736% in terms of the percentage for the purposes of the mandatory OPA).

It should also be noted that Rodolfo De Benedetti, Chairman of the Board of Directors of the Company and of the Board of Directors of the shareholder F.LLI DE BENEDETTI S.p.A., directly and indirectly owns 16,497,569 shares and 16,497,569 voting rights of the Company.

In light of the decision taken by Fratelli De Benedetti S.p.A. not to accept the Offer, the percentage of its voting rights could increase as an effect of the acceptance of other shareholders.

FDB has also notified the Issuer that it is not interested in launching a Public Tender Offer for all of the shares and is committed for now, should it be necessary, to give up a sufficient number of its increased voting rights and in any case not to exercise any excess votes to the extent of reducing them, if as an effect of the Company’s buyback transaction, the conditions were to exist for an obligatory OPA.

It should also be pointed out that the increased vote mechanism adopted by the Company makes it impossible to predict with certainty the extent of any increases in the percentage of voting rights by the controlling shareholder, even in the event that the whole of the offer is accepted.

HOW THE OFFER WILL BE FINANCED

To provide financial cover for the Offer, which would be for a maximum amount of Euro 80,000,000, CIR intends to use part of the cash liquidity, some of which came from the sale of its interest in GEDI Gruppo Editoriale S.p.A. completed on April 23 2020, which can cover the entire amount.

The maximum amount of the Offer is lower than the Company’s distributable reserves, which at December 31 2020 amounted to Euro 96.5 million, in compliance with what is set out in the first paragraph of Art. 2357 of the Civil Code, which establishes that the buyback of own shares may take place within the limits of the distributable earnings and the available reserves resulting from the most recent financial statements regularly approved.

Since December 31 2020 no significant negative events have taken place.

CONDITIONS FOR THE OFFER TO TAKE EFFECT

To be effective the Offer is subject (A) to the non-occurrence by the end of the first Stock Exchange trading day after the end of the Acceptance Period of (i) any exceptional events or situations at national and/or international level involving important changes in the political, financial, economic, currency situation or any market change that had not arisen on the date of publication of the Offer Document and which could substantially prejudice the Offer, the conditions of the businesses and/or the patrimonial, economic and/or financial conditions of CIR and/or of the companies belonging to the CIR Group, or of (ii) acts, facts, circumstances, events or situations that had not arisen as of the date of publication of the Offer Document and which could substantially prejudice the Offer, the conditions of the businesses and/or the patrimonial, economic and/or financial conditions of CIR and/or of the companies belonging to the CIR Group as resulting from the most recent financial statements approved by the Issuer, and/or (B) to the competent institutions, entities or authorities not adopting and/or publishing, by the end of the first Stock Exchange trading day after the end of the Acceptance Period, any legislative or administrative acts or measures (including public tender offer obligations as per Articles 106 and following articles of TUF) or judicial measures that preclude, limit or make it more financially onerous totally or partially, even temporarily, for CIR and/or the CIR Group to complete the Offer ((A) and (B), jointly, the “Conditions of the Offer”).

The conditions stated in letter A above include the non-occurrence of events with the characteristics as above and that arise as a consequence of or in relation to the spread of the Covid-19 pandemic (which, although it is today a publicly acknowledged phenomenon, could have consequences that at present cannot be foreseen in any way on any area of the business), including as an example that is in no way exhaustive, a crisis, temporary suspension or closure of the financial markets and/or of production activities and/or of services that could have, or could reasonably have, prejudicial effects on the Offer and/or on the Issuer or on the companies that the latter controls.

The Offeror can waive or amend all or some of the terms of the Conditions of the Offer at any moment and with an indisputable decision within the limits and following the procedures contained in Article 43 of the Rules for Issuers.

The Offer is not subject to reaching a minimum number of acceptances.

DURATION OF THE OFFER

The Period of Acceptance of the Offer will be agreed upon with Borsa Italiana and will be between a minimum of 15 and a maximum of 40 trading days, as per Article 40, paragraph 2, letter b) of the Rules for Issuers, unless the Offeror gives notice of a deferral as per the terms of current legislative and regulatory rules.

NOTIFICATION OR APPLICATION FOR AUTHORIZATION REQUIRED BY APPLICABLE REGULATIONS

The Offer is not subject to authorization. The Annual General Meeting of the Shareholders held on April 30 2021 approved a resolution authorizing the buyback for a period of 18 months of a maximum of 225,000,000 (and in any case up to the legal limit) own shares following possible procedures, including the Offer at a price that must not be more than 15% higher or lower than the benchmark price recorded in the Stock Exchange trading session on the day before the day on which the purchase price is fixed (the AGM resolution is available on the website www.cirgroup.it in the Governance section).

WEBSITE FOR THE PUBLICATION OF PRESS RELEASES AND DOCUMENTATION RELATING TO THE OFFER

The press releases and the documents relating to the Offer will be available for consultation on the Issuer’s website www.cirgroup.it in the Governance section.

The press releases and the documents relating to the Offer will also be available for consultation at CIR’s registered office in Milano, Via Ciovassino 1.

APPLICABILITY OF EXEMPTIONS AS PER ARTICLE 101-BIS, PARAGRAPH 3, OF THE TUF

According to what is stated in Article 101-bis, paragraph 3, letter d) of the TUF, the rules of Articles 102 (Obligations of offerors and interdictive powers), paragraphs 2 and 5, Article 103, paragraph 3-bis (The Offer Process), 104 (Defences), 104-bis (Neutralization rule) and 104-ter (Reciprocity clause) of the TUF and any other rule of the TUF that involves specific disclosure obligations for the Offeror or the Issuer towards employees or their representatives will not be applicable to the Offer.

MARKETS FOR THE OFFER

The Offer is being launched exclusively for the Italian market, the only market on which the Shares are listed and is aimed at all of the Issuer’s shareholders, without distinction and at equal conditions.

The Offer is not being and will not be launched in the United States of America, Canada, Japan or Australia, or in any other country in which such launch is not allowed without authorization by the competent authorities (“Other countries”) or using instruments for communication or international commerce (including, for example, the postal network, fax, telex, e-mail, telephone or the internet) of the United States of America, Canada, Japan, Australia or Other Countries,or any structure of any financial intermediary of the United States of America, Canada, Japan, Australia or Other Countries, or in any other way.

Acceptance of the Offer by persons or entities resident in countries other than Italy may be subject to specific obligations or restrictions contained in their legislation or regulations. It is the exclusive responsibility of the offerees to comply with such regulations and thus before accepting the Offer they should check with their advisors whether any such rules are applicable.

ADVISORS FOR THE DEAL

CIR is assisted by Prof. Piergaetano Marchetti as legal advisor and by UniCredit S.p.A. as financial advisor.

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- 14:19 CEST

CIR: AGM approves Financial Statements for 2020

Milan, April 30 2021 – The Annual General Meeting of the Shareholders of CIR S.p.A. was held today in Milan under the chairmanship of Rodolfo De Benedetti, with an ordinary and an extraordinary session.

As per the terms of Art. 106, paragraph 4, of Decree Law no. 18 of March 17 2020, the Shareholders were able to attend exclusively through the designated representative, appointed in accordance with Art. 135-undecies of D.Lgs. no. 58 of February 24 1998 (TUF) and identified as Studio Segre S.r.l., to whom proxies/sub-proxies were also assigned under Art. 135-novies of the TUF, in waiver of Art. 135-undecies, paragraph 4, of the same TUF.

Approval of the Financial Statements for 2020

In the ordinary part of the Meeting the Shareholders approved CIR’s Financial Statements for the year 2020. The group closed the year with consolidated revenues of € 1,834.8 million (€ 2,001.6 million in 2019) and net income of € 16.3 million. The parent company CIR S.p.A. reported net income of € 2.6 million.

The Meeting adopted the proposal put forward by the Board of Directors not to distribute any dividends.

Compensation Policy and Stock Grant Plan

The Shareholders’ Meeting approved the first section of the Report on Compensation Policy and Remuneration Paid and expressed a vote in favour of the second section of the said report.

The Shareholders also approved the 2021 Stock Grant Plan, aimed at directors and/or executives of the Company and its subsidiaries for a maximum of 5,000,000 conditional rights, each of which will give the beneficiaries the right to be assigned free of charge 1 CIR share. The shares will be made available from the Company’s treasury shares. The plan has the aim of aligning the interests of management with the objectives of creating value for the group and its shareholders over a medium-long term time horizon and of retaining key managers in the group.

Authorization to buy back own shares

The Shareholders’ Meeting authorized the Board of Directors, for a period of 18 months, to buy back a maximum of 225,000,000 own shares and in any case up to 20% of the total number of shares making up the share capital (taking into account the own shares that the Company is already holding, which as of today amount to 26,819,394, equal to 2.1% of the total number of shares), at a unit price that must not be more than 15% higher or lower than the benchmark price recorded by the shares in the Stock Exchange trading session preceding the date of each individual buy-back transaction or preceding the date on which the price is fixed. Where such buybacks are effected through orders placed on the regulated market the price of the deal must not be higher than the higher of the price of the most recent independent transaction and the highest current independent bid price in the same market, in compliance with the provisions of Delegated Regulation (EU) no. 2016/1052.

The main reasons for renewing the authorization are the following: i) to fulfil obligations resulting from possible stock option plans or other awards of the Company’s shares to employees or members of the Board of Directors of CIR or its subsidiaries; ii) to have a portfolio of own shares to use as consideration for possible extraordinary transactions, even those involving an exchange of equity holdings, within the scope of transactions of interest to the Company (a stock of securities); iii) to support the liquidity of the shares in the market, optimizing its capital structure and remunerating the Shareholders in particular market conditions; iv) to take advantage of opportunities for creating value, as well as investing liquidity efficiently in relation to the market trend; v) for any other purpose qualified by the competent Authorities as admitted market practice in accordance with applicable European and domestic rules, and with the procedures established therein.

Reduction of the number of Board Members

The AGM reduced to eleven, from twelve, the number of members of the Board of Directors. Following the resignation for personal reasons of Director Pia Hahn Marocco, at the meeting held on March 29 2021 the Board decided not to co-opt a new Director but to propose to the Shareholders a reduction of the number of Directors, being convinced that, even with such reduction, the number of member would still be adequate and acknowledging that its composition conforms with the rules of law and with the Company’s Corporate Governance Code as regards independence, gender balance and variety of competences.

Amendment of the Company Bylaws

In the extraordinary part of the meeting, the Shareholders abolished the nominal value of the shares, approving the amendment of Art. 4, paragraph, of the Company Bylaws. The introduction of shares without a nominal value is a useful flexibility tool as it simplifies a broad range of capital transactions for the Company.

Board of Directors Meeting

On the strength of the authorization given by the AGM, the Board of Directors implemented the 2021 Stock Grant Plan by assigning 3.565.284 rights.

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- 18:10 CEST

Sogefi: AGM approves Financial Statements for 2020

SOGEFI: AGM APPROVES FINANCIAL STATEMENTS FOR 2020

BOARD OF STATUTORY AUDITORS APPOINTED FOR THREE YEARS 2021-2023

SIPAHI CONFIRMED AS CEO

Milan, April 23 2021 – The Annual General Meeting of the Shareholders of Sogefi S.p.A. was held today under the chairmanship of Monica Mondardini.

As per the terms of Art. 106, paragraph 4, of Decree Law no. 18 of March 17 2020, the Shareholders were able to attend only through the designated representative, appointed in accordance with Art. 135-undecies of D.Lgs no. 58 of February 24 1998 (TUF) and identified as Studio Segre S.r.l., to whom proxies/sub-proxies were also assigned as per Art. 135-novies of the TUF, in waiver of Art. 135-undecies, paragraph 4, of the TUF.

Approval of the Financial Statements for 2020

The Shareholders approved the Financial Statements for the year 2020. Sogefi closed the year with consolidated revenues of € 1,203.2 million (€ 1,463.8 million in 2019), EBITDA of € 137.6 million (€ 177.4 million in 2019) and a net result of ongoing operations posting a negative result of € 19.6 million (net income of € 11.1 million in 2019). The parent company of the group Sogefi S.p.A. reported a loss of € 6.2 million (net income of € 7.7 million in 2019).

The Shareholders’ Meeting adopted the proposal put forward by the Board of Directors that no dividends be distributed.

Compensation Policy and Stock Grant Plan

The AGM approved the first section of the Report on Compensation and remuneration paid and expressed a vote in favour of the second section of the same Report.

The Shareholders also approved the stock grant plan for 2021 aimed at employees of the Group holding strategically important roles for a maximum of 1,000,000 conditional rights, each of which will give the beneficiaries the right to be assigned free of charge 1 Sogefi share. The shares thus assigned will be made available from the own shares held by the Company. The plan aims to align the interests of management with the objective of creating value for the Group and its Shareholders over a medium-long term time horizon, stimulating the commitment to achieving common objectives at Group level and encouraging those who hold important positions to remain with the Group.

Authorization to buy back own shares

The Shareholders renewed for a period of 18 months its authorization of the Board of Directors to buy back a maximum of 10 million of its own shares (including 2,094,831 own shares being held today, equal to 1.744% of the share capital), at a unit price that must not be more than 10% higher or lower than the benchmark price recorded by the shares in the stock exchange trading session preceding each individual buyback transaction or the date on which the price is fixed an, in any case, when the purchases are made in the regulated market the price cannot be higher than the higher of the price of the last independent transaction and the highest current independent bid price in the same market, in compliance with the terms set out in EU Delegated Regulation no. 2016/1052.

The main reasons why this authorization is being renewed are the following: to fulfil obligations resulting from possible stock option plans or other awards of shares of the Company to employees or members of the Board of Directors of Sogefi or associated companies; to fulfil obligations resulting from any debt instruments convertible into or exchangeable with equity instruments; to support market liquidity of the shares within the limits of current rules; to take advantage of opportunities for creating value, and invest liquidity efficiently in relation to market trends; for any other purpose qualified by the competent Authorities as admitted market practice in accordance with applicable European and domestic rules and with the procedures established therein.

Appointment of a director and of the Board of Statutory Auditors

The Shareholders’ Meeting appointed Frédéric Sipahi – co-opted by the Board, as per the terms of Art. 2386 of the Civil Code, on February 26 2021 – as a director of the Company.

The Shareholders also appointed the members of the Board of Statutory Auditors of the Company for the three years 2021-2023. The auditors in office are Daniela Delfrate (Chairman of the Board of Statutory Auditors), Giovanni Barbara and Rita Rolli. The alternate auditors are Maria Pia Maspes, Luca Del Pico and Anna Maria Allievi. The auditors were drawn from the list presented by the majority Shareholder CIR S.p.A., with the exception of the Chairman Daniela Delfrate and alternate auditor Maria Pia Maspes, who were selected from the minority list presented by YODA Società Semplice.

Board of Directors Meeting

The Board of Directors, which met after the AGM, confirmed Frédéric Sipahi as Chief Executive Officer of Sogefi. Since March 1 2021 he has also held the position of General Manager. His curriculum vitae is available on the website www.sogefigroup.com.

The Board verified the presence of the requisites for the independence of the directors who have attested that they are independent, Patrizia Canziani, Roberta Di Vieto, Mauro Melis, Ervino Riccobon and Christian Georges Streiff. Five directors out of a total of eight are therefore independent. The Board of Statutory Auditors in its turn verified the presence of the requisites for the independence of its members; the curricula vitae of the auditors are available on the website sogefigroup.com. All the independent directors and the members of the Board of Statutory Auditors are therefore in possession of the requisites established by law and by the Code of Corporate Governance adopted by the Company.

Lastly, the Board of Directors, on the strength of the authorization granted by the AGM, proceeded to implement Stock Grant Plan 2021 by assigning 897,500 rights.

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- 16:18 CEST

Sogefi: results for first quarter 2021

RESULTS FOR FIRST QUARTER 2021

REVENUES RECOVER AND PROFITABILITY IMPROVES

Revenues significantly higher at € 356.6 million (+9.3% at constant exchange rates) outperforming the market in all geographical areas

EBITDA margin at 15.4% of revenues up from Q1 2020 (11.3%) and Q1 2019 (11%)

Net income € 11.8 million (loss of € 5.6 million in first quarter 2020 and earnings of € 1.6 million in first quarter 2019)

Free Cash Flow positive for € 32.4 million versus € 5.4 million in Q1 2020

Milan, April 23 2021 – The Board of Directors of Sogefi S.p.A., which met today under the chairmanship of Monica Mondardini, has approved the Interim Financial Report of the Group as of March 31 2021, presented by Chief Executive Officer Frederic Sipahi.
Sogefi, a company of the CIR Group, is one of the main global producers of automotive components for three sectors: Air and Cooling, Filtration and Suspensions.

In the first quarter of 2021 world car production reported growth of 14% compared to first quarter 2020 with the month of March posting +34.7% compared to the previous year. The recovery in the first quarter of 2021 was mainly attributable to China, the first country to be hit by the pandemic in 2020, where production rose by 78.2% compared to the first quarter of the previous year. India and Mercosur also saw a recovery in the market (+22.8% and +4.6% respectively), while the EU and NAFTA reported volumes below those of first quarter 2020 (-0.9% and -4.5% respectively).

However, world production was still below pre-Covid levels: more specifically, compared to the first quarter of 2019, it was -11.3%, with Europe at -20%, NAFTA at -14.7% and China at -4.2%.

During first quarter 2021, the Group’s priority continued to be the safety of its employees; all measures for health and safety in the workplace were kept in place to reduce the risk of contagion, with social distancing, the use of individual protective equipment and measures to limit the presence of people in the workplace with employees working from home.

The Group reported a significant recovery in revenues: +5% at historical exchange rates and +9.3% at constant exchange rates; compared to the first quarter of 2019, revenues came in at -5.2%, versus the -11.3% of world production.

The recovery in revenues together with the action plan put in place to counter the impact of the crisis, enabled the group to close the first quarter with earnings of € 11.8 million (a loss of € 5.6 million in the first quarter of 2020) and a positive free cash flow of € 32.4 million (€ 5.4 million in the first quarter of 2020).

Moreover, in the period Sogefi acquired new contracts worth more than those of the same period of previous years and in line with the objectives of increasing its market share, and a significant part of these new orders were for hybrid or full electric vehicles, thus positioning itself in the markets of the future.

More specifically, the Air and Cooling division closed an important contract (Lifetime Value: € 260 million) to supply new generation air aspiration manifolds for a prime North American OEM. More new orders were also acquired from Chinese and North American producers, of which around 40% of their value was for parts for cooling hybrid or full electric vehicles.

The Filtration division also obtained important orders from North American and European customers for traditional components (especially oil filters), which will be produced in the US and Moroccan plants, and signed new contracts for the production of air filters for interiors.

As for the Suspensions division, 35% of the value of the orders acquired was for hybrid or full electric vehicles. In the first quarter of the year new orders were also acquired for light commercial vehicles and heavy goods vehicles, market segments with good prospects for the coming years.

REVENUES

In the first quarter of 2021 Sogefi’s sales revenues came in at € 356.6 million, and were higher than those of the same period of 2020 by 5% at historical exchange rates and 9.3% at constant exchange rates; sales were down by 5.2% on first quarter 2019. After the first two months with revenues at historical exchange rates down by 8.7%, in March, the month in 2020 when the effects of the pandemic started to be evident (with a fall of 30%), there was a strong recovery (+42.1%), with volumes substantially in line with those of 2019.

Performance of revenues by geographical area

The performance of revenues at constant exchange rates was better than that of the market in all geographical areas: +1.9% in Europe compared to the market’s -0.9%, +3.3% in North America versus -4.5%, and +104.5% in China versus the market’s +78.2%. The lower growth of the Group’s total revenues (+9.3%) compared to those of global markets (+14%) was due to the fact that China, which was the area of the world in which there was most growth in the first quarter, accounts for 6.7% of the Group’s sales, whereas at market level it accounts for 28.1%.

Performance of revenues by Business Unit

In terms of the business sectors, Air and Cooling reported good growth (+15.2% at constant exchange rates) thanks to the development of the contract portfolio especially in China, where revenues doubled compared to the previous year; revenues at current exchange rates were 2.6% higher than those of first quarter 2019.

Filtration reported more moderate growth (+4.2% at constant exchange rates), following a decline in 2020 that was decidedly more limited than that of the market thanks to the After Market business. In the first quarter of 2021 sales were slightly higher (+2.1% at current exchange rates) than those of first quarter 2019.

Lastly, Suspensions reported revenue growth of 9.7% at constant exchange rates, due to the good performance in China and South America, but business remains significantly below the level of the corresponding period of 2019 (-16.9% at current exchange rates).

OPERATING RESULT AND NET RESULT

EBITDA came in at € 54.8 million and was higher than the figure reported for the first quarter of 2020 (€ 38.2 million) and 2019 (€ 41.4 million); gross profitability (EBITDA / Revenues %) rose to 15.4%, from around 11% in the first quarters of 2019 and 2020.

The contribution margin improved from 30.3% to 30.7%, despite the tension in the market over the availability and pricing of raw materials.

The rationalization measures adopted in 2020 which continued through the early months of 2021 led to a reduction of 5.5% in fixed costs compared to first quarter 2020, which, combined with the recovery of the business, gave rise to a reduction in the ratio of fixed costs to revenues which declined from 18% in the first quarter of 2020 to 16.1% in the same period of 2021. It should be noted that, compared to first quarter 2019, fixed costs fell by 13.8%.

Lastly, the increase in EBITDA had a further boost from the positive effect of exchange rates (€ +1.7 million in 2021 versus € -3.4 million in first quarter 2020) and from the recognition of a non-operating gain of € 2.4 million.

EBIT came to € 25.9 million, up from € 7.9 million in the same period of 2020 and from € 12.5 million in the first quarter of 2019. Financial expense, amounting to € 6.2 million, was in line with the corresponding period of 2020, tax expense came to € 6.1 million, versus € 2.5 million in the previous year, and the net result of “discontinued operations” was a negative € 0.8 million, versus € -4.9 million in first quarter 2020.

The Group reported net income of € 11.8 million compared to a loss of € 5.6 million in first quarter 2020 and earnings of € 1.6 million in first quarter 2019.

DEBT AND EQUITY

Free Cash Flow was a positive € 32.4 million (€ 5.4 million in first quarter 2020), thanks to the higher EBITDA and the favourable performance of working capital.

Net debt before IFRS16 stood at € 261.1 million at March 31 2021, down from the end of 2020 (€ 291.3 million) and substantially unchanged from March 31 2020 (€ 256.7 million). The Group managed to keep its debt level stable despite the dramatic effects of the pandemic on the business during the last 12 months.

Including financial payables for rights of use as per IFRS 16, net debt at March 31 2021 stood at € 328.4 million, which compares with € 358.1 million at December 31 2020 and € 313.4 at March 31 2020.

As of March 31 2021 the Group had committed credit lines in excess of its borrowing requirement of € 362 million (of which € 100 million is needed to repay its convertible bond maturing in May 2021).

At March 31 2021 Shareholders’ equity, excluding minority interests, amounted to € 150.6 million (€ 133.0 million at December 31 2020).

THE IMPACT OF COVID-19 ON THE BUSINESS

In the early months of 2021, although the pandemic crisis is still continuing, its effects on the market in which the Company operates were less traumatic than those experienced in March 2020 and the following months. However, as shown in the data for vehicle production in the period, business remains very weak especially in Europe and NAFTA.

In addition to having taken action as from March 2020 to reduce the impact of the crisis, the Group has been working and will continue to work on a process of structural adaptation to the changed circumstances of the market in a context that is still uncertain.

OUTLOOK FOR THE YEAR

In addition to there being at present little visibility as to the direction of the market in the next few months as this will depend on the evolution of the pandemic, there is also uncertainty regarding the trend of raw material prices (mainly steel), their availability (semiconductors) and logistics issues involving transport and sourcing from Asian markets.

For the second quarter of 2021, IHS expects that world production will rebound by 58% compared to the second quarter of 2020 (the period that saw the maximum negative effect of the pandemic worldwide with the sole exception of China), while remaining 10% lower than in Q2 2019.

For full year 2021 the market is expected to grow by 11.9% but to remain at lower levels than those of 2019 with the recovery of a good part of the collapse recorded in 2020, reaching -6.2% compared to 2019.

Sogefi confirms the view it expressed on the publication of its results for 2020, i.e. that in a market scenario such as that explained above, incorporating the effects of the decisive action taken in 2020 and ongoing in 2021 to reduce the impact of fixed costs and to improve profitability structurally, it expects to return to a positive result for full year 2021 and to be able to achieve a ratio of EBIT to sales at least on a par with what was reported for 2019.

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- 19:13 CEST

CIR: filing of documentation for AGM

Milan, April 9 2021 – Regarding the Annual General Meeting of the Shareholders of CIR S.p.A., to be convened in extraordinary and ordinary sessions for April 30 2021, at a single calling, it is announced that the following documentation is available at the Company headquarters (Via Ciovassino 1, Milan), on the website www.cirgroup.it (section Governance/Shareholders meetings) and on the authorized storage mechanism eMarket STORAGE:

  • The Annual Report and Financial Statements for the year ended December 31 2020, the Report of the Board of Statutory Auditors, and the Reports of the Firm of Auditors (item 2 of the ordinary part);
  • The Report on Corporate Governance and ownership structure as per Art. 123 – bis del TUF;
  • The Consolidated Non-Financial Report for 2020;
  • The Report of the Board of Directors on the proposed authorization to buy back own shares and use them as appropriate (item 3 of the ordinary part);
  • The Report on Compensation Policy and Remuneration Paid as per Art. 123 – ter of the TUF (item 4 of the ordinary part).

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- 18:59 CEST

CIR: documentation filed for AGM

Milan, March 30 2021 – Regarding the Annual General Meeting of the Shareholders of CIR S.p.A., to be convened in extraordinary and ordinary sessions for April 30 2021, at a single calling, it is announced that the following documentation is available at the Company headquarters (Via Ciovassino 1, Milan), on the website www.cirgroup.it (section Governance/Shareholders meetings) and on the authorized storage mechanism eMarket STORAGE:

  • The Report of the Board of Directors on the proposal to eliminate the indication of the nominal value of the shares and the consequent amendment of Art. 4, paragraph 1, of the Company Bylaws (sole item of the extraordinary part);
  • The Report of the Board of Directors on the proposal to approve Stock Grant Plan 2021 (item 5 of the ordinary part);
  • The Report of the Board of Directors on the proposal to reduce the number of Board members from 12 to 11 (item 6 of the ordinary part).

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- 21:50 CEST

CIR: resignation of a Director

Milan, March 29 2021 – CIR S.p.A. announces that Pia Hahn Marocco has, for personal reasons, resigned her position as member of the Board of Directors of the Company as from the coming Annual General Meeting of the Shareholders.

It should be remembered that Pia Hahn Marocco is an independent Director as well as being on the Control, Risk and Sustainability Committee and the Committee for Related-Party Transactions.

As of today Pia Hahn Marocco is not the owner of any shares of CIR S.p.A..

In line with the compensation policy adopted by the Company, there is no indemnity or any other benefit following the termination of a position.

CIR would like to thank Pia Hahn Marocco for her work on behalf of the Company.

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- 13:58 CET

CIR: results for 2020

  • 2020 results impacted by the effects of the Covid-19 pandemic on the business of the subsidiaries: revenues € 1,834.8 million (€ 2,001.6 million in 2019), EBITDA € 227.0 million (€ 274.8 million in 2019).
  • Net income at € 16.3 million and reduction of consolidated net debt before IFRS 16 to € 100 million (€ 227.6 million) thanks to the extraordinary transactions completed during the year.
  • Net financial position of the parent company a positive € 391.7 million, up from December 31 2019 (€ 296.2 million).
  • Fourth quarter recovery: volumes back in line with Q4 2019 for Sogefi, rehabilitation activity resumes for KOS.

Milan, March 12 2021 – The Board of Directors of CIR S.p.A., which met today under the chairmanship of Rodolfo De Benedetti, has approved the proposed financial statements and the consolidated accounts of the group as at December 31 2020 presented by Chief Executive Officer Monica Mondardini.

Consolidated results

The results of the group in financial year 2020 were affected by the impact of the Covid-19 pandemic on the business of the subsidiaries, which operate in sectors that have been hard hit by the public health crisis.

KOS, the company active in social healthcare services, had to counter the consequences of the pandemic on its nursing homes for the non self-sufficient elderly (RSAs) and the decline in rehabilitation services, partly because of the stress affecting the health system, which led to a significant reduction in programmed hospital activities. In the second half of the year activity in the rehabilitation sector recovered, while the activity of the nursing homes continued to suffer because of the difficulties involved in accepting new patients at this stage. The number of presences was therefore significantly lower than the historical averages.

Sogefi, the company active in the production of automotive components, in the first half of 2020 reported an unprecedented fall in volumes, as did all the sector, caused by the generalized suspension of production activities and plummeting demand. In the second half of the year production recovered considerably, reaching volumes close to those of 2019.

Financial management reported positive results, thanks to the recovery of all the main financial markets in the second half of the year.

During the year some significant extraordinary transactions were concluded.

In April 2020, CIR completed the sale of its controlling interest in GEDI, of which it now holds 5%, following the strategic decision taken in 2019 to exit the sector in which the group operates and the agreement reached in December 2019 with EXOR.

In November 2020, KOS sold its subsidiary Medipass, realizing a significant capital gain; the deal was part of the strategy of focusing on and developing the long-term care business, even abroad, particularly in Germany, where it acquired the Charleston group, a significant organization that has 47 care homes and over 4,000 beds.

Lastly, Sogefi has launched a plan for rationalizing its geographical presence and its industrial footprint, with the aim of increasing the profitability of the group, particularly in Filtration, selling its branches in Brazil and Spain.

The extraordinary transactions had a positive impact on the group’s results and brought about a significant reduction in consolidated net debt.

CIR’s consolidated revenues came in at € 1,834.8 million, down by 8.3% compared to 2019 (€ 2,001.6 million), because of the reduction in the business of both sectors in which the group operates due to the circumstances caused by the pandemic.

The consolidated gross operating margin (EBITDA) came to € 227.0 million, 12.4% of sales versus 13.7% in 2019 (€ 274.8 million).

The net result was a positive figure of € 16.3 million.

The consolidated net debt before IFRS 16 stood at € 100.0 million at December 31 2020, down sharply (€ 227.6 million) compared to December 31 2019 (€ 327.6 million). Financial payables for rights of use as per IFRS 16 totalled € 796.8 million at December 31 2020 and thus overall consolidated net financial debt came to € 896.8 million. The payables as per IFRS 16 refer mostly to the subsidiary KOS (€ 730.3 million), which operates mainly in leased premises.

The net debt of the subsidiaries fell to € 491.7 million (€ 623.8 million at December 31 2019) as a result of the contraction reported by KOS, which was due to the sale of Medipass.

The net financial position at December 31 2020 of the parent company (including the non-industrial subsidiaries), before IFRS 16, was a positive € 391.7 million, up from the figure at December 31 2019 (€ 296.2 million).

The equity of the group stood at € 771.0 million at December 31 2020 (€ 770.7 million at December 31 2019).

KOS

In 2020, KOS’s revenues came in at € 631.6 million, up by 17.4% on 2019, thanks to the constant development achieved in recent years and more especially to the acquisition at the end 2019 of Charleston, which operates in Germany in the care-home sector. Revenues in Italy were down by 9.5%.

In the Italian care homes, activity focused on the difficult management of the public health emergency. During the year, new admittances were frozen or at least extremely limited and thus the number of presences fell and remains significantly lower than in 2019, even today.

In the German care homes, the impact of the pandemic was decidedly less severe from the healthcare point of view and thus even the reduction in the number of guests was less extreme than in Italy. Moreover, the public support given to the care homes limited the economic impact.

In the rehabilitation and acute care facilities in Italy, where in the first half there was a decline in the number of patients following a slowdown in normal hospital activity, a strong recovery took place in the second half of the year with performance in line with the same period of 2019.

EBIT came to € 15.4 million, down from € 57.9 million in 2019: the reduction was due both to the decline in the number of guests and services provided because of the healthcare emergency, but also to the higher costs incurred for protection measures to counter and contain the effects of the pandemic.

KOS reported net income € 46.7 million (€ 30.3 million in 2019), thanks to the result of the sale of Medipass.

In November 2020 KOS indeed sold the Medipass business in Italy and the UK to DWS Alternatives Global Limited (“DWS”), keeping the Indian branch. The enterprise value recognized was € 169.2 million, with an equity value of € 105.6 million, a capital gain for KOS of € 54.4 million, net of the transaction costs incurred, and a positive impact on the overall net financial position of € 162.8 million.

Free cash flow amounted to a positive € 167.2 million, almost entirely generated by the Medipass deal. The group made investments in new facilities for approximately € 30 million.

Net debt stood at € 200.7 million at the end of 2020 versus € 368.0 million at December 31 2019.

Sogefi

In 2020 world car production fell by 16.2% compared to 2019: -23.3% in the EU, -20.1% in North America, -4.2 % in China and -30.7% in South America, due to an unprecedented contraction in the first half of the year. The second half was characterized by a recovery of the business in all geographical areas, with world production in the period almost in line with 2019.

Sogefi reported a decline in revenues of 17.8% at current exchange rates (-14.2% at constant exchange rates), outperforming the market in Europa, NAFTA and China.

The normalized net result, excluding non-recurring restructuring charges, was around breakeven, thanks to the measures adopted to counter the crisis in the market, which led to a slight increase in the contribution margin (to 30.8%, versus 30.2% in 2019) and a reduction in fixed costs of approximately 20%, with a ratio to sales unchanged from 2019 at 17%, despite the lower revenues, and lower at 15.8% in the fourth quarter (17.1% in the last quarter of 2019).

The net result was impacted by the charges incurred for the restructuring plan launched in 2020 and already implemented in part, the net amount of which comes to a total of around € 16.0 million. Moreover, at the end of 2020 the group sold the Brazilian Filtration branch, posting a loss for the year of approximately € 15 million, mostly due to accounting effects of the deconsolidation.

Free cash flow was a negative € 38.2 million (compared to cash generation of € 8.4 million in 2019), due mainly to the unfavourable evolution of working capital caused by the particular circumstances that occurred during the year.

Net financial debt before IFRS 16 stood at € 291.3 million at December 31 2020 (€ 256.2 million at the end of 2019).

In 2020 Sogefi obtained new contracts for a value in line with previous years and consistent with the objectives of maintaining/increasing its market share, with a significant portion of the new orders being for hybrid or full electric vehicles, thus positioning itself in the markets of the future.

Financial management

Thanks to the recovery of the markets in the second half of the year for all categories of asset, total net financial income of € 17.3 million was reported, with a return on the portfolio of 4%. More specifically, the total return on readily liquidable assets, i.e. the portfolio of shares, bonds and hedge funds, rose to 5.3% (€ 19.1 million), while the portfolio of private equity funds and minority equity investments reported a decline in fair value of € 1.8 million, with a return of -2.3%.

Outlook for the year

Given the continuing uncertainty regarding the evolution of the pandemic, there is limited visibility as to the performance of the group’s businesses in the coming months.

As far as KOS is concerned, thanks to the effect of the vaccination plans, a return to pre-Covid levels is expected to take place in 2022. In Germany, given the lower impact of the pandemic and the greater public sector subsidies, results should continue to be in line with the growth forecasts made when the acquisition took place in 2019.

As for Sogefi, IHS expects world production to recover by 13.7% compared to 2020 although the level will still be lower than in 2019 (-4.8%). In this scenario Sogefi forecasts a return to profit for the full year 2021 thanks to a recovery in volumes and the action on costs already taken and programmed.

Dividend proposal

The Board of Directors has decided to propose to the Annual General Meeting of the Shareholders that no dividends be distributed.

Shareholders’ meeting

The Annual General Meeting has been convened in an ordinary and an extraordinary session to be held at a single calling on April 30 2021. The Board of Directors at today’s meeting has adopted the following resolutions:

  • To propose in the extraordinary part of the Shareholders’ Meeting that Art. 4.1 of the Company Bylaws be amended to eliminate the nominal value of the shares. The institution of shares without a nominal value is a useful tool in terms of flexibility as it simplifies a broad range of the Company’s capital transactions (such as, for example, the cancellation of own shares, and capital increases and reductions).
  • To put before the ordinary session of the Shareholders’ Meeting a motion to cancel and renew the authorization of the same Board of Directors for a period of 18 months to buy back a maximum of 225,000,000 of its own shares and in any case up to 20% of the share capital at a unit price that cannot be more than 15% higher or lower than the benchmark price recorded by the shares on regulated markets on the trading day preceding each single buyback transaction or the date on which the price is fixed. In any case, when the shares are bought back with orders placed in the regulated market, the price must not be higher than the higher of the price of the last independent transaction and the highest current independent bid price on the same market, in compliance with what is set out in EU Delegated Regulation no. 2016/1052. This authorization is being requested for the following reasons: to fulfil the obligations resulting from possible stock option plans or other awards of shares of the Company to employees or members of the Board of Directors of CIR or its subsidiaries, to have a portfolio of own shares to use as consideration in any possible extraordinary transactions, even those involving an exchange of equity holdings with other entities within the scope of transactions of interest to the Company (a so-called “stock of securities”); to support the liquidity of the shares in the market, to optimize the capital structure and to reward shareholders in particular market situations; to take advantage of opportunities for creating value, as well as investing liquidity efficiently, in relation to the market trend; for any other purpose qualified by the competent Authorities as admitted market practice in accordance with applicable European and domestic rules, and with the procedures established therein.
  • To put before the ordinary session of the Shareholders’ Meeting for approval a stock grant plan for 2021 aimed at directors and/or executives of the company and its subsidiaries for a maximum of 5,000,000 conditional rights, each of which will give the beneficiaries the right to be assigned 1 CIR share free of charge. The shares will be made available from the own shares held by the Company.

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- 16:12 CET

Sogefi: consolidated results for 2020. New CEO appointed

FOURTH QUARTER 2020
Revenues and results higher than in Q4 2019

RESULTS FOR THE YEAR 2020 
The group showed resilience in a totally exceptional year

Revenues: € 1,203.2 million, -14.2% at constant exchange rates (car market -16.2%) 
Outperformed market in all geographical areas
In Q4, revenues higher (+8.9% at constant exchange rates)

EBITDA margin, excluding non-recurring charges, was higher reaching 13% of revenues (12.1% in 2019)

Net result before non-recurring charges and result of operations for disposal close to break-even (€ -3.4 million)

Net non-recurring charges for rationalization actions came to € 16.2 million (€ 4.3 million in 2019)

THE BOARD APPOINTED AS NEW GROUP CEO FREDERIC SIPAHI, LEADER OF THE AIR & COOLING BUSINESS UNIT TURNAROUND AND SINCE 2019 ALSO MANAGER OF THE FILTRATION BU

Milan, February 26 2021 – The Board of Directors of Sogefi S.p.A., which met today under the chairmanship of Monica Mondardini, has approved the proposed financial statements for the year 2020, presented by Mr Mauro Fenzi.

The Board of Directors appointed the current General Manager of the Air & Cooling and Filtration Business Units, Mr. Frederic Sipahi, as new group CEO, in substitution of Mr. Mauro Fenzi.

Frederic Sipahi, aged 40, has a business education and has spent his entire career in the automotive sector, initially in PSA, then in Faurecia and since 2012 in Sogefi.

Since 2015 he has led the Air & Cooling division, achieving a significant improvement in performance, both in terms of increased profitability and cash generation; he also achieved positive results in 2020, despite the extraordinary context. He also reoriented the division’s product strategy, by effectively positioning it towards new technologies.

Since 2019 he has also led the Filtration division, where he launched major rationalisation and efficiency enhancement programs.
Mr. Fenzi said: “After a year of intense work, my managerial role at Sogefi comes to an end for personal reasons. Sogefi has an extremely motivated and competent management team, that is well equipped to face with the right determination the challenges of the next few years. I take this opportunity to thank my collaborators for their professional and decisive contribution and the members of the Board of Directors for their continuous support”. The Board of Directors thanked him for the work done.

SUMMARY OF RESULTS FOR 2020

After the first half of 2020 in which world car production suffered a dramatic and unprecedented fall (-33.2%) due to the effects of the spread of the Covid-19 pandemic, in the second half of the year the market reported a definite recovery compared to the previous half (+44%), with volumes substantially unchanged compared to the same period of 2019 thanks to the growth reported in the last quarter of 2020 (+2.5%). The recovery in the fourth quarter was seen in all markets: China, where production was up by 5.9% on the fourth quarter of the previous year, NAFTA, the EU and South America, with volumes substantially equivalent to those of the fourth quarter of 2019 (+0.5%, +1.4% and +1.3% respectively).

Despite the recovery in the second half, the results for the whole year reported an extraordinarily significant downturn compared to 2019: -16.2% for world car production,  -23.3% in the EU, -20.1% in North America, -4.2 % in China and -30.7% in South America.

In 2020 the Group’s priority was the safety of its employees; from the moment when news came of the Covid-19 phenomenon in China, action was immediately taken to reduce the risk of contagion and then all the measures recommended for health and safety in the workplace were adopted, reviewing the production processes and implementing new safety protocols, which involve physical distancing and the use of individual protection systems. Currently it has been decided to maintain the measures to limit the presence of personnel in the workplace, with staff working from home.

At the same time radical action was taken to mitigate the impact of the crisis, and of the consequent contraction in sales, on results and on the capital solidity of the Group. The measures put in place made it possible to obtain the following:

  • An increase in the contribution margin to 30.8% from 30.2% in 2019;
  • A 19.1% reduction in fixed costs with an unchanged ratio to sales of 17%, which was down in 4Q 2020 (15.8% versus 17.1% in 4Q 2019).

Moreover, in 2020 Sogefi obtained new contracts for a value in line with previous years and consistent with the objectives of maintaining/increasing its market share, with a significant portion of the new orders being for hybrid or full electric vehicles, positioning itself in the markets of the future.

More specifically, 25% of the value of the orders acquired in 2020 by the Air and Cooling division is destined for cooling hybrid or full electric vehicles; the division also obtained an important contract (Life Time Value: € 100 million) to supply air-intake manifolds in aluminium to a prime German OEM,  launching a new product line in a sector in which the division is already market leader.

Similarly, 35% of the value of the orders received by the Suspensions division is for hybrid or full electric vehicles, thanks to the new product developed to meet the light-weight and time-to-market requirements of electric vehicles and to the receipt of an order from a prime North American producer of full electric vehicles.

REVENUES

In 2020, Sogefi’s revenues totalled € 1,203.2 million and were down by 17.8% on 2019 at historical exchange rates and by 14.2% at constant exchange rates.

An examination of the performance of revenues throughout the year shows that in the first quarter revenues fell by 9.6%, because of the spread worldwide of the pandemic as from March; in the second quarter they fell by 55.6%, in a phase of substantial lockdown in the main markets; during the third quarter there was a gradual recovery (-6.6% on 2019), which led to growth of 2% in the fourth quarter (+8.9% at constant exchange rates) compared to the same period of 2019.

Performance of revenues by geographical area

The performance of revenues at constant exchange rates was better than the market in all the main geographical areas; the decline in Europe was 18.1% versus the market’s -23.3%, and in North America it was 9.8% versus -20.1%; in Asia revenues rose, while the market reported -7%, thanks particularly to the good performance of China (+15.8% versus the market’s -4.2%).

Performance of revenues by Business Unit

Filtration (with an 8.1% decline in revenues at constant exchange rates) and Air and Cooling (-10.7% at constant exchange rates) reported a much less negative result than the market thanks, for Filtration, to the fact that the OES and Aftermarket channels held up better and for Air and Cooling to the development of the portfolio of contracts particularly in China and North America. The impact of the crisis was greater for Suspensions, which suffered a fall in revenues of 22.7% at constant exchange rates, reflecting the greater concentration of the business in Europe and South America and the particularly bad performance of the sector in these areas.

OPERATING RESULT AND NET RESULT

The results of the group were affected by the fall in revenues and the non-recurring charges linked to the launch of plans for reducing fixed costs, particularly in Europe, and for rationalizing the Group’s footprint (sale and closure of two production sites in Europe) as well as its geographical presence (sale of the filtration business in Brazil).

EBITDA came in at € 137.6 million compared to € 177.4 million in 2019. Excluding the rationalization charges as above, EBITDA declined from € 177.4 million to € 156.9 million with profitability (EBITDA / Revenues %) of 13%, which was higher than the figure for 2019 (12.1%).

The contribution margin for 2020 was slightly better than that of 2019, rising from 30.2% to 30.8% and the ratio of fixed costs to sales remained unchanged, despite the lower revenues, thanks to the cost-cutting measures taken, which were partly temporary and partly destined to become structural.

EBIT came to € 7.2 million, versus € 48.4 million in 2019.  The lower EBIT reflects the fall in revenues, the gross non-recurring charges of € 20 million (€ 4.3 million in 2019) and further write-downs of fixed assets for € 12.9 million (€ 4.9 million in 2019), resulting from the action taken by the company to counter the crisis.

The Group reported a net loss from businesses destined to continue of € 19.6 million, mainly because of € 16.2 million of non-recurring rationalization charge (versus earnings of € 11.1 million in 2019). The operations sold between the end of 2020 and the beginning of this year (the Brazilian subsidiary and the Spanish subsidiary of the Filtration business unit) gave rise to a loss of € 15.5 million, which compares with a loss of € 7.9 million in 2019.

DEBT AND EQUITY

Regarding Free Cash Flow, in 2020 an amount of € 38.2 million was absorbed (versus cash generation of € 8.4 million in 2019), mainly as a result of the evolution of working capital due to the particular circumstances that arose during the year.

Net financial debt before IFRS16 stood at € 291.3 million at December 31 2020 (€ 256.2 million at the close of 2019), but was lower than at September 30 2020 (when net debt was € 299 million).

Including the financial payables for rights of use, as per IFRS 16, the net debt amounted to € 358.1 million at December 31 2020, up from € 318.9 million at December 31 2019. It should be noted that in 2020 the Group invested in the development of a new suspension production site in Romania, with the aim of increasing the group’s competitiveness in the sector, and signed the lease agreement for the new site, which led to the recognition of an IFRS 16 payable of approximately € 19 million.

At December 31 2020 the covenants contained in the loan agreements were being complied with.

At December 31 2020 the Group had committed credit lines in excess of its requirements for € 340.1 million (of which € 100 million earmarked for the repayment of the convertible bond maturing in May 2021); in 2020  new medium-term loan agreements were signed for a total amount of € 134.5 million, including a loan of € 80 million (signed in October 2020) granted by prime Italian banks and guaranteed by SACE, and new credit facilities with French banks for a total of € 54.5 million, most of which are also guaranteed by the French state.

At December 31 2020 shareholders’ equity, excluding minority interests, amounted to € 133.0 million (€ 188.7 million at December 31 2019).

SUMMARY OF RESULTS OF FOURTH QUARTER 2020

The revenues for fourth quarter 2020 rose by 2% at historical exchange rates and by 8.9% at constant exchange rates compared to the same period of 2019.

EBITDA, excluding the charges for the rationalization action, came in at 14.5% versus 12.3% in 2019.

For operations destined to continue the Group reported a net loss of € 4.4 million caused by non-recurring rationalization charges of € 11.9 million (versus a loss of € 0.9 million in the same period of 2019). The businesses sold between the end of 2020 and the beginning of this year (the Brazilian subsidiary and the Spanish subsidiary of the Filtration business unit) generated a loss of € 7.6 million, which compares with a loss of € 4.2 million reported by the same subsidiaries in 2019.

Free Cash Flow before IFRS 16 was a positive € 8.7 million, in line with the same period of 2019.

IMPACT OF COVID-19 ON BUSINESS

Following the spread of the Covid-19 pandemic, Sogefi first suspended production in China and then in the second half of March suspended activity in almost all of its production sites. Business started to resume first in China and then from May onwards in all the other countries in which the Group operates, albeit with production volumes that were until August significantly lower than those of the previous year and of expectations.

As for the evaluation of the impact that the pandemic is having on the Group, the pre Covid-19 forecasts had envisaged that sales revenues for 2020 would be substantially in line with 2019 and in the first two months of the year the Company did in fact report volumes equivalent to or higher than those expected. However, during subsequent months there was an extremely significant decline with a recovery only from June onwards. Because of this, in 2020 Sogefi reported revenues of € 1,203.2 million, 17.8% lower than those of 2019 at historical exchange rates; this reduction was almost entirely attributable to the effects of the circumstances brought about by the pandemic. The contraction in volumes, although partly offset by the reduction in fixed costs, nonetheless involved an estimated negative impact on EBIT of € 34 million and of € 21 million on the net result, with a consequent increase in debt.

As well as having reacted promptly to reduce the impact of the crisis from March until today, the Company has also adopted a plan to adapt its structure to the changed market circumstances and this plan is already being implemented.

RESULTS OF THE PARENT COMPANY OF THE GROUP SOGEFI S.P.A.

For 2020 the parent company of the group Sogefi S.p.A. reported a net loss of € 6.2 million compared to net income of € 7.7 million in 2019. The decline was due mainly to the lower flow of dividends distributed by the subsidiaries and to higher financial expense.

OUTLOOK FOR THE YEAR

Given the continuing uncertainty regarding the evolution of the pandemic, there is very little clarity as to how the market will perform in coming months.

There is also uncertainty about the trend of commodity prices (particularly those of steel) and their availability (semiconductors), as well as logistical difficulties involving transport and sourcing from Asian markets.

For the year 2021, IHS is forecasting a recovery in world production of 13.7% compared to 2020, but this will still be lower than in 2019 (-4.8%).

In this scenario, thanks to the effects of the drastic action taken in 2020 to reduce the impact of fixed costs and to bring about a structural improvement of its profitability, Sogefi expects to return to profit for the full year 2021.

TERMINATION OF THE EMPLOYMENT RELATIONSHIP WITH MR. FENZI

No amount has been paid in relation to the resignation of Mr. Fenzi from the position of Chief Executive Office and no payment is provided in relation to the termination of the employment relationship, in addition to the mandatory payments required by law. Based on the information available, Mr. Fenzi does not own shares in Sogefi.

PROPOSED DIVIDEND

The Board of Directors will put forward the proposal to the Annual General Meeting of the Shareholders that no dividends be distributed.

ANNUAL GENERAL MEETING

The Annual General Meeting of the Shareholders of Sogefi will be held at the first call on April 23 2021 and at the second call on April 26 2021.

The Board of Directors has voted to put the following proposals before the Annual General Meeting of the Shareholders:

  • In the light of the current legislative and regulatory rules, Consob Resolution no. 20876 of April 3 2019, Consob Guidelines of July 2019 and Consob Resolution no. 21318 of April 7 2020, the cancellation and renewal of the authorization of the same Board of Directors, for a period of 18 months, to buy back a maximum of 10 million own shares (including 2,102,588 shares, equal to 1.75% of the share capital) at a unit price that cannot be more than 10% higher or lower than the benchmark price recorded by the shares on regulated markets on the trading day preceding each single buyback transaction or the date on which the price is fixed. In any case, when the shares are bought back in the regulated market, the price must not be higher than the higher of the price of the last independent transaction and the highest current independent bid price on the same market, in compliance with what is set out in EU Delegated Regulation no. 2016/1052.
    The main reasons why this authorization is being renewed are: to fulfil the obligations resulting from possible stock option plans or other awards of shares of the Company to employees or members of the Board of Directors of Sogefi or its affiliated companies; to fulfil any obligations resulting from debt instruments that are convertible into or exchangeable with equity instruments; to support market liquidity of the shares; to take advantage of opportunities for creating value, as well as investing liquidity efficiently in relation to the market trend; for any other purpose qualified by the competent Authorities as admitted market practice in accordance with applicable European or domestic rules, and with the procedures established therein.
  • The approval of a Stock Grant Plan for 2021 aimed at employees of the Company and its subsidiaries, in the terms to be defined by the Board of Directors and notified to the market in sufficient time for any legal obligations to be carried out. The Stock Grant Plan has the aim of rewarding the loyalty of the beneficiaries to the companies of the Group, giving them an incentive to increase their commitment to improving the performance of their Company.

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- 15:55 CET

CIR: calendar of events for 2021

Milan, January 29 2021 – CIR S.p.A. announces that the Company’s calendar of events for 2021 will be as follows:

Friday 12.03.2021 10.00 a.m. Board of Directors Meeting (Pro-forma Financial Report for 2020)  
Friday 30.04.2021 11.00 a.m Annual General Meeting of the Shareholders (Approval of Financial Report for 2020)  
Friday 30.07.2021 10.00 a.m. Board of Directors Meeting (Half-year Financial Report for 2021)

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- 13:15 CET

KOS completes the sale of its subsidiary Medipass to the DWS fund

Milan, November 27 2020 – In completion of what was announced on September 7 2020, KOS completed today the sale of 100% of the shares of Medipass S.r.l. (buying back the operating companies in India) to Inframedica S.p.a., a company indirectly and wholly owned by DWS Alternatives Global Limited, the investment manager delegated to manage the Pan-European Infrastructure III, SCSp fund.

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- 14:00 CET

CIR files Interim Financial Report

Milan, November 11 2020 – CIR S.p.A. announces that the Interim Financial Report as of September 30 2020, approved by the Board of Directors on October 30, is available to the public on the authorized storage mechanism eMarket STORAGE (www.emarketstorage.com), at the registered office of the Company and on its website (www.cirgroup.com).

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- 15:07 CET

CIR: results for first nine months of 2020

  • Third quarter 2020 results improved, with consolidated revenues up slightly from 3Q 2019, EBITDA and EBIT showing progress and a net result (€ 10.0 million) higher than that of 3Q 2019
  • Results for first nine months of 2020 were negatively affected by the performance of the first half which was badly hit by the economic consequences of the Covid-19 pandemic. Revenues at € 1,329.4 million (€ 1,528.0 million in first nine months of 2019). EBITDA at € 174.2 million (€ 201.8 million in the first nine months of 2019). EBIT positive at € 12.9 million (€ 66.0 million in the first nine months of 2019). Net result: -€ 20.2 million
  • Net financial position of the parent company positive for € 384.0 million, higher than at December 31 2019 (€ 295.7 million)

Milan, October 30 2020 – The Board of Directors of CIR S.p.A., which met today under the chairmanship of Rodolfo De Benedetti, has approved the Financial Report as of September 30 2020 presented by Chief Executive Officer Monica Mondardini.

Consolidated results

The third quarter of this year saw a recovery in all businesses, with consolidated revenues up by 0.7% on the revenues of the same period of 2019, EBITDA and EBIT showing progress and a net result of € 10.0 million, which was higher than in third quarter 2019.

In the social and healthcare sector, KOS reported a recovery in rehabilitation services after hospital activities resumed in a quarter with less stress on the health service in relation to the emergency caused by the Covid-19 pandemic.

In automotive components, Sogefi, thanks to its better performance than the market in terms of sales and to its cost cutting actions, closed the quarter with a positive result. As regards the financial assets of the CIR holding company and its non-industrial subsidiaries, which were in line with their respective markets, there was a recovery in stock prices and this compensated for the losses seen in the first six months of the year.

The results of the first nine months of 2020 were still affected very negatively by the first half of the year, in which all business activities suffered the effects of the circumstances that arose because of the pandemic and the particularly restrictive measures adopted.

Consolidated revenues came in at € 1,329.4 million and were down by 13% on 2019.

The consolidated gross operating margin (EBITDA) came to € 174.2 million and was 13.7% lower than the figure for the first nine months of 2019 (€ 201.8 million).

The consolidated operating result (EBIT) was € 12.9 million, down from € 66.0 million in the corresponding period of 2019, reflecting the lower EBITDA and the higher amortization after the consolidation of KOS’s business in Germany, which was acquired at the end of 2019.

The net result was a loss of € 20.2 million compared to a net income figure of € 5.4 million in the same period of 2019. Compared to the first half of the year, the loss was significantly less.

KOS’s business activity was affected by the public health emergency in all sectors, with a significant impact on its economic performance. In the Italian nursing homes, the focus was on the difficult management of the public health emergency and new entries were frozen for several months. During the third quarter new patients started to be accepted again and the number of guests stabilized albeit at a significantly lower occupancy rate than in 2019. In the German nursing homes the impact of the pandemic on healthcare was considerably less and therefore the reduction in the number of guests was more limited than in Italy. In the rehabilitation units the number of patients declined following the slowdown in normal hospital activity, when the health service was in a state of stress, and outpatient activities were suspended or much reduced as were diagnostic activities. However in the third quarter there was a strong recovery with an increase in services provided compared to the same period of 2019.

Revenues totalled € 468.8 million and were up by 23.7% on the same period of 2019 (but fell by 10.5% on a like-for-like basis, excluding Charleston, the group operating in Germany in the care home sector, which was acquired in October 2019). EBIT amounted to € 26.8 million down from € 44.2 million in 2019 due to the decline in the number of guests and patients in Italy because of the Covid-19 emergency and the higher costs incurred for protective equipment to counter and limit the effects of the pandemic. The net result was a positive € 4.9 million versus net income of € 23.5 million in 2019.

In September KOS signed a binding agreement with DWS Alternatives Global Limited for the sale of Medipass, excluding the businesses in India, of which KOS will retain ownership. The enterprise value agreed upon is € 169.2 million and the equity value is estimated at around € 103.0 million (net of the disbursement incurred by KOS for the acquisition of the businesses in India), plus a possible earn-out of € 2.5 million. Completion of the deal is subject to the issue of the necessary authorizations by the competent authorities and to certain waivers by third parties, which as things stand are almost completely satisfied. The deal is expected to complete by the end of November 2020 and will generate a capital gain for KOS of over € 50 million that will be recognized only at the moment of completion.  The sale of Medipass is part of KOS’s strategy of focusing on its core business (long-term care) in Italy and Germany.

Moving on to Sogefi, in the third quarter the automotive sector reported a definite recovery in world car production, with a decline in volumes of 3.5% compared to the same period of 2019, after the unprecedented dramatic fall experienced uffered in the first half of the year (-33.2%) due to the effects of the spread of the Covid-19 pandemic.

In this context, Sogefi reported a positive third quarter,  with revenues down by 8.1% and net income of € 5.6 million (compared to € 1.4 million in third quarter 2019), thanks to the measures put in place to counter the crisis, which enabled Sogefi to increase its contribution margin to 31% from 30.3% in 2019 and 29.5% in the second quarter, and to reduced its fixed costs by 20%, with a ratio to sales down from 17% in third quarter 2019 to 15% in 2020.

The first nine months of 2020 remain strongly affected by the first half of the year: revenues came in at € 860.6 million, down by 25.1% compared to 2019, EBITDA came to € 94.7 million versus € 130.7 million in 2019, and the period closed with a loss of € 23.2 million (net income of € 8.3 million in 2019).

In spite of the situation of the first nine months, since the beginning of the year Sogefi has acquired new contracts for a total that is estimated as being in line with previous years and with the objectives of maintaining/increasing its market share.  

Regarding the financial investments of the holding company and the subsidiaries devoted to financial management, in the third quarter of 2020 asset values recovered, bringing the overall return for the nine months to breakeven, after the loss reported in the first half. Bonds and hedge funds (which account for some 85% of the portfolio) had an overall return of +1.8% while private equity and financial equity investments reported a reduction in their total fair value of 8%. 

Consolidated net debt before IFRS 16 totalled € 264.0 million at September 30 2020, which was lower than at December 31 2019 (€ 327.6 million) and at June 30 2020 (€ 285.7 million). Financial payables for rights of use as per IFRS 16 came to a total of € 808.9 million at September 30 2020 and thus the total consolidated net debt was € 1,072.9 million. The payables as per IFRS 16 mainly refer to the subsidiary KOS (€ 733.5 million), which operates mainly in leased premises.

The net financial position of the parent company (including the non-industrial subsidiaries) was a positive € 384.0 million at September 30 2020, higher than at December 31 2019  (€ 295.7 million), thanks to the net cash inflow from the sale of the shareholding in GEDI Gruppo Editoriale to EXOR (with an amount of € 102.4 million received for the entire holding and the reinvestment of € 11.7 million for 5% of the same GEDI). The equity of the Group stood at € 736.9 million at September 30 2020, down from € 770.7 million at December 31 2019. The decline was due to the loss for the period and to negative exchange rate differences resulting from the translation of the financial statements of foreign subsidiaries.

Outlook for the year

Visibility for the coming months remains limited because of the uncertainty about the effects of the evolution of the pandemic on the businesses of the group. Indeed, Europe is experiencing the second phase of the spread of the Covid-19 pandemic, with recent figures showing levels higher than during the lockdown earlier in the year. In North and South America the evolution of the pandemic remains extremely concerning. We cannot therefore rule out, as has recently been confirmed in certain countries, the possibility of the authorities issuing new restrictions on private-sector production and business activities, which would impact the activities of the group.  

As far as KOS is concerned, it is expected that rehabilitation activity could consolidate the recovery seen in the third quarter, provided that there is no new freeze on regular hospital activity, while for care homes in Italy in the short term it is likely that the number of guests will remain below historical averages. At the same time care homes will continue to incur additional costs to counter the emergency. The care-home sector in Germany, which has been less affected by the pandemic in terms of level of activity and which is in any case supported financially by the public health service, should report results in line with expectations, advancing its plan for improving operations and increasing income. In this difficult environment it is expected that EBIT for the whole year will not be lower than the figure reported for the first nine months of the year.

Sogefi has factored into its forecasts for the fourth quarter the assumption that the market will be around -10%, in which it expects to be able to achieve a significantly positive EBIT for the whole year, excluding restructuring charges.    Based on the considerations regarding the group’s investees, provided there is no shutdown of business or any other extraordinary event that cannot at present be predicted, the forecast is for a positive consolidated EBIT result and a significantly positive net income figure thanks to extraordinary transactions (particularly the sale of Medipass).

Appointment of CIR’s new Financial Reporting Officer

The Board of Directors has resolved, after receiving the favourable opinion of the Board of Statutory Auditors, to appoint Michele Cavigioli as the Officer responsible for the preparation of the company’s financial and corporate statements as per the terms of Art. 154-bis of the TUF and in compliance with Art. 21 of the Company Bylaws. The appointment will take effect as from January 1 2021. Michele Cavigioli, 51, has been in CIR since 2005, has held the position of Central Finance Director since 2010 and is also responsible for relations with financial analysts and institutional investors. He is also CEO of CIR Investimenti and sits on the Board of Directors of KOS. He worked previously for McKinsey & Company, Deutsche Bank and Magnemag AG. Michele Cavigioli will take the place of the current financial reporting officer Giuseppe Gianoglio, 62, who will be leaving the group in January 2021, having chosen to retire. The Board of Directors thanks Giuseppe Gianoglio for his important contribution to the group over the past 16 years.

It should be noted that Giuseppe Gianoglio holds 488,013 CIR shares and rights resulting from Stock Grant Plans for a total of 1,359,648 Units. Michele Cavigioli holds 24,248 CIR shares and rights resulting from Stock Grant Plans for a total of 1,422,461 Units.

Resolution on periodic financial reporting

The Board of Directors has decided that as from financial year 2021 it will no longer publish interim financial reports as of March 31 and September 30, exercising the right granted by D.Lgs 25/2016 for the same reasons that inspired the Transparency II 2013/50 directive of the European Union transposed into Italian law by the above decree.  

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- 13:44 CEST

Sogefi: results for first nine months of 2020

THIRD QUARTER 2020 SHOWS PROFIT

Higher revenues, greater margin and lower fixed costs

RESULTS FOR FIRST NINE MONTHS NEGATIVELY IMPACTED BY FIRST HALF

Revenues at € 860.6 million, -21.9% at constant exchange rates (car market -23.2%)

EBITDA margin in line with 2019: € 94.7million, 11% of revenues

 (11.4% in first nine months of 2019)

EBIT: -€ 3.2 million as effect of lower volumes

EBIT for the whole year 2020 expected to be positive (excluding restructuring costs)

Milan, October 23 2020 – The Board of Directors of Sogefi S.p.A., which met today under the chairmanship of Monica Mondardini, has approved the Interim Financial Report of the group as of September 30 2020. Sogefi, a company of the CIR group, is one of the main producers worldwide of components for motor vehicles in three sectors: Air and Cooling, Filtration and Suspensions.

After the first half of 2020 in which world car production suffered an unprecedented decline (-33.2%) due to the effects of the spread of the Covid-19 pandemic, in the third quarter the market reported a strong recovery compared to the previous quarter (+60.7%), with volumes just 3.5% below those of the same period of 2019 (after a second quarter at -42.9%). The recovery affected all markets: China, where production was greater than that of the third quarter of the previous year (+10.7%), NAFTA with volumes equivalent to those of third quarter 2019 (+0.5%), the EU with volumes gradually rising, although lower in the third quarter than in 2019 (-10.7%). In South America the situation was still decidedly critical (-20.9%).

Despite the recovery in the third quarter, the first nine months of 2020 as a whole again posted very significant declines: -23.2% for world car production compared to the first nine months of 2019, -31.3% in the EU, -26.5% in North America, -8.9 % in China and -40.4% in South America. 

During the first half of the year the Group’s priority was the safety of its workforce. From the moment when news of the Covid-19 phenomenon in China was received, action was taken immediately to reduce the risk of contagion. In the second quarter almost all activity in the factories and other workplaces was suspended in compliance with the instructions issued by the various local authorities or at the decision of the company, which had recourse everywhere to working from home whenever possible. All measures recommended for health and safety in the workplace were adopted and production processes were reviewed in all geographical areas with the formulation and implementation of new safety protocols including social distancing and the use of systems for individual protection. In the current phase, the new wave of contagion is leading to the adoption of further restrictive measures to limit the number of people present in the workplace with the adoption of flexible working.

At the same time, incisive measures were put in place to mitigate the impact of the crisis and the consequent contraction in sales and these made it possible to achieve a positive result in the third quarter. In particular, this result was due to the following:

  • The increase in the contribution margin to 31%, up from 30.3% in the third quarter of 2019 and 29.5% in the second quarter;
  • The 20.2% reduction in fixed costs with their ratio to revenues falling from 17% in third quarter 2019 to 14.8% in 2020.

Despite the situation of the first nine months, since the beginning of the year Sogefi has obtained new contracts for a total amount estimated to be in line with previous years and with the objectives of maintaining/growing its market share.

More specifically, Air and Cooling obtained an important contract (€ 100 million) to supply air intake manifolds in aluminium to a prime German OEM. This material to all extents and purposes introduces a new product line in a date 25% of the value of orders received in the first nine months of the year were for components for cooling hybrid or full-electric vehicles, which forms a basis for the division to achieve an excellent positioning in the markets in future.  

The Suspensions division received an order from a prime North American producer of full-electric vehicles and thus, at global level, orders for hybrid and full-electric applications reached 35% of the total orders for the 9-month period. This growth was obtained partly thanks to the new product developed specifically to meet the demand for lightweight parts and rapid time-to-market for electric vehicles. The division has in fact engineered a conical progressive rate spring suspension for this type of application.

KEY RESULTS FOR THE THIRD QUARTER OF 2020

Third quarter revenues showed a significant recovery compared to the previous period and were more or less in line with the third quarter of 2019 at constant exchange rates (-8.1% at current exchange rates).

The results were positive thanks to the recovery of revenues and to the measures adopted, which led to a slight increase in the contribution margin and a significant reduction of fixed costs. 

EBITDA was 14% compared to 12% in the same period of 2019.

EBIT was positive for € 15.6 million, which was higher than the figure for 2019 of € 13.1 million; the ratio of EBIT to sales rose from 3.5% to 4.6%.

In the period the Group reported net income of € 5.6 million versus € 1.4 million in 2019.

Free Cash Flow before IFRS 16 was positive for € 28.0 million versus € 2.8 million in 2019.

KEY RESULTS FOR THE FIRST NINE MONTHS OF 2020

REVENUES

In the first nine months of 2020, Sogefi’s revenues came in at € 860.6 million, posting a decline compared with the same period of 2019 of 25.1% at historical exchange rates and of 21.9% at constant exchange rates.

Looking back at the trend of revenues during the year, after the first two months of the year when sales were in line with 2019, in March the first effects of the pandemic were recorded (-29.5% on 2019), which then became seriously worse in the months of April (-79.5%) and May (-64.5%); in June the recovery began (with a more limited fall in revenues compared to 2019, -24.9 %), continuing then in July (-18%), August (-7.5%) and September, when revenues showed slight growth compared to 2019 (+0.8%). 

The performance of revenues at constant exchange rates in the first nine months was better than  the market in all the main geographical areas: -24.6% in Europe versus the market’s -31.3%, -17.9% in NAFTA versus -26.5%, +12.6% in China versus -8.9%.

By business sector, Filtration (with a fall in revenues of 16.2% at constant exchange rates) and Air and Cooling (-17.8% at constant exchange rates) reported a distinctly less unfavourable performance than the market thanks, for Filtration, to the greater resilience of the OES and Aftermarket channels and, for Air and Cooling, to the development of the contract portfolio particularly in North America. The impact of the crisis was greater for Suspensions, where revenues fell by 30.6% at constant exchange rates, reflecting the greater concentration of the business in Europe and South America and the particularly unfavourable performance of the sector in these areas.

OPERATING RESULT AND NET RESULT

In the nine month period the fall in revenues had significant effects on the economic results of the group, despite the positive impact of the mitigation measures adopted.

EBITDA for the first nine months came in at € 94.7 million, down from € 130.7 million in the same period of 2019; it should be noted that profitability (EBITDA / Revenues %) came to 11%, which was substantially in line with the same period of 2019 (11.4%).

The contribution margin of the first nine months of the year was slightly better than that of 2019, rising from 29.7% to 30.3%; the impact of the cost of raw materials was lower thanks partly to market phenomena and partly to the plans put in place as from last year to optimize the purchase prices of steel for the production of suspension systems and this offset the impact of the inevitable production inefficiencies caused by the shutdown and subsequent return to production and the low volumes. The ratio of fixed costs to sales in the first nine months was substantially unchanged from the same period of 2019, thanks to the reductions obtained, part of which were temporary while part were destined to become structural.

EBIT was a negative € 3.2 million, which compared to a positive result of € 37.4 million in the first nine months of 2019. The lower EBIT reflects the fall in revenues and the non-recurring charges incurred as a result of the situation: restructuring charges of € 14.2 million (€ 5.7 million in the first nine months of 2019) and the write-down of fixed assets for € 8.2 million (€ 2.2 million in the same period of the previous year).

The group’s net result was a loss of € 23.2 million compared to net income of € 8.3 million in 2019, after financial expense that was substantially in line with that of the previous year and tax expense of € 2.8 million versus € 12.6 million last year. 

DEBT AND EQUITY

Regarding Free Cash Flow, in the first nine months of 2020, before IFRS 16, absorption of € 42.8 million was reported (versus -€ 0.5 million in the first nine months of 2019), most of which was due to the evolution of working capital caused by the particular circumstances that arose during the year. As is generally the case in the sector, amounts due from customers are received more promptly compared to the payment terms of suppliers, thanks partly to the use of factoring. The decline in sales resulted in lower cash receipts, while payments to suppliers continued to be made. This imbalance is gradually being re-absorbed as business recovers. Free Cash Flow including IFRS 16 payables amounted to -€ 55.6 million compared to -€ 4.3 million in the first nine months of 2019.

Net debt before IFRS 16 stood at € 299.0 million at September 30 2020, higher than at the end of 2019 (€ 256.2 million), but significantly lower than the figure at June 30 2020 (when the net debt amounted to € 327 million).

Including the financial payables for rights of use, as per IFRS 16, net debt at September 30 2020 totalled € 374.5 million, up from € 318.9 million at December 31 2019 and € 330.0 million at September 30 2019. It should be noted that in 2020 the group has been developing a new site for the production of suspensions in Romania, which will increase the group’s competitiveness in the sector. In the third quarter the signing of the lease contract for the new facility led to the recognition of an IFRS 16 payable of approximately € 19.0 million.

As is known, as of June 30 the covenants of the loan agreements in force were being complied with and to the best of our knowledge at present and based on our forecasts, no breaches of contract are expected to emerge by December 31 2020.

At September 30 2020 the group had committed credit lines € 220.0 million in excess of its requirements.

At September 30 2020 shareholders’ equity, excluding minority interests, amounted to € 146.6 million (€ 188.7 million at December 31 2019).

THE IMPACT OF COVID-19 ON THE BUSINESS

Following the spread of the Covid-19 pandemic, Sogefi first suspended production in China and then in the second half of March production at almost all of its sites. Business started to resume everywhere, first in China and then from May onwards in all the other countries in which the group operates, albeit with production volumes that were until August significantly lower than those of the previous year and those forecast.

As for the evaluation of the impact that the pandemic is having on the group, the pre Covid-19 forecasts had envisaged that sales revenues for 2020 would be substantially in line with 2019 and in the first two months of the year the Company did in fact report volumes equivalent to or higher than those expected. However, during subsequent months there was an extremely significant decline with a recovery only from June onwards. Consequently Sogefi reported revenues of € 860.6 million, down by 25.1% compared to the same period of last year. This reduction was almost entirely attributable to the effects of the circumstances generated by the pandemic. The contraction in volumes, even though partly offset by the reduction in fixed costs, nonetheless had a negative impact that can be estimated at € 42.0 million on EBIT and of € 27.0 million on the net result. It also led to a significant rise in debt.  

The Company has been taking action to reduce the impact of the crisis since March but in addition to this it is now working to adapt itself structurally to the changed market circumstances and to rapidly regain economic and financial stability, albeit in a context of lower volumes which are today forecast even for the fourth quarter of 2020 and for 2021.  

SIGNIFICANT EVENTS THAT HAVE TAKEN PLACE SINCE SEPTEMBER 30 3020

In October the group obtained new medium-term loan agreements for a total amount of € 134.5 million granted by prime Italian and French banks.

OUTLOOK FOR THE YEAR

Visibility as to the evolution of the market in the coming months remains limited despite the improvement in volumes seen in the third quarter.

With regard to the pandemic, in Europe the risk of a second wave of Covid-19 appears to be materializing with recent figures showing that it is spreading at higher levels than during the lockdown phase. In North and South America the evolution of the pandemic remains most concerning and it is difficult, therefore, to predict what measures will be taken by the authorities. The adoption in coming months of new measures limiting production and private business cannot be ruled out. It is also extremely uncertain as to what impact the current circumstances will have on demand in the automotive sector.

After a third quarter 2020 that was better than expected, for the fourth quarter of 2020 IHS expects that world production could come in at -2.7% compared to the fourth quarter of 2019. The year 2020 could therefore close with a market downturn of 17.9% on the whole year.

In this uncertain scenario Sogefi has factored into its projections for the fourth quarter the assumption that the market will be around -10%, in which it expects that it will be able to achieve a positive EBIT for the whole year, excluding restructuring charges.  

STOCK GRANT PLAN

On the strength of the authorization given to it by the Annual General Meeting of the Shareholders on April 20 2020, the Board of Directors implemented Stock Grant Plan 2020 by assigning 790,000 rights.

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- 08:43 CEST

KOS signs an agreement for the sale of its subsidiary Medipass (excluding the Indian business) to the DWS fund for an enterprise value of € 169 million and a net consideration estimated at approximately € 103 million

Milan, September 7 2020 – KOS and Inframedica S.àr.l., a company directly and wholly controlled by DWS Alternatives Global Limited, the investment manager delegated to manage the Pan European Infrastructure III Fund, SCSp (“DWS”) have signed a binding agreement for the transfer from KOS to DWS of 100% of the shares of Medipass S.r.l. (“Medipass”). Before the sale is completed, KOS will buy back from Medipass the Indian subsidiaries (Clearmedi Healthcare Private LTD, Clearview Healthcare Private LTD).

The enterprise value agreed upon is € 169.2 million and the equity value can be estimated at approximately € 103 million, net of the price that KOS will pay for the acquisition of the businesses in India. The total amount that will be paid on completion by DWS to KOS will be subject to adjustments linked to the actual financial position of Medipass as of September 30.

Completion of the deal is subject to the issue by the competent authorities of the necessary authorizations and to certain third party waivers, including those related to KOS’ loan agreements. Because of the time required for the authorization processes, the deal is expected to complete by the end of 2020.

The transaction will generate a net capital gain for KOS of approximately € 50 million and will reduce its debt by around € 160 million, compared to total debt (before IFRS 16) of € 356.2 million at June 30 2020.

Medipass is a leading provider of Cancer Care and Advanced Diagnostic Imaging services in Italy and the UK. Acquired by KOS in 2006, Medipass has become one of the key players in providing private and public healthcare facilities with turnkey solutions for the management of diagnostics and cancer care departments, managing standard technologies (e.g. CT, RX, ultrasound imaging), advanced technologies such as Nuclear Medicine (PET-CT) for diagnostics activities, and Radiotherapy departments for cancer care. Medipass serves over 20 healthcare facilities (hospitals and clinics) in Italy and the UK and it is uniquely positioned to meet the growing demand in the sector for investments to renew and expand the existing stock of equipment providing life-saving services.

The agreement reached for the sale shows that Medipass has created significant value since it was acquired by KOS.

The deal will enable KOS to significantly increase the allocation of resources to the growth of its core businesses (managing care homes, hospitals and rehabilitation facilities both in Italy and abroad, particularly in Germany, where it already has a significant presence).

Lastly, regarding the activities in India, where today Medipass is one of the leading providers of technological services for healthcare, with revenues of € 20.7 million in 2019, KOS will evaluate available options to realise its value. 

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DWS Infrastructure is a leading infrastructure investor and it is part of DWS Group & GmbH Co KGaA, an independent listed asset manager (ETR: DWS), with a presence in c. 40 countries and approximately EUR 745 billion of assets under management (as of June 2020). DWS Infrastructure is one of the largest European infrastructure investors and has approximately EUR 20.8 billion of assets under management as of December 2019. DWS Infrastructure seeks to create and add value to its funds’ investments through active asset management as well as through its network, experience and funding to achieve the company’s growth potential.

Hamish Mackenzie, Global Head of Infrastructure at DWS said:

“We are delighted to invest in Medipass and to partner with its impressive management team in this next phase of its journey. Medipass has been one of the pioneers in the Cancer Care sector, offering outsourcing services in diagnostics and cancer care since the 1990s, with a consistent track record of providing patients with the highest quality of care using cutting edge technology.

Medipass represents our third investment in Italy and the second investment for our fund, PEIF III, which is supported by a large component of Italian pension funds and insurance companies, and invests in infrastructure companies providing essential services across Europe.

KOS has done an excellent job in growing the company over the past years. Together with the management team, we will look to leverage Medipass’ expertise, our resources and our experience as infrastructure investors, to further expand the Company’s presence in healthcare centers across Europe to enable them to enhance their technology parks and services for the benefit of their patients.”

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KOS is a leading Italian healthcare group operating in long term care, including nursing homes, rehabilitation and psychiatry, as well as acute care. In these sectors of activity the KOS Group manages 90 facilities in Italy, with almost 8,700 beds, and 47 in Germany, with some 4,000 beds. It has just under 13,700 collaborators, of whom around 8,900 are in Italy (7,400 employees) and some 3,800 are in Germany. KOS’s revenues for 2019 totalled € 595 million, of which approximately 10% came from the Medipass companies being sold to DWS. KOS is owned for 59.5% by CIR and for 40.5% by F2i Healthcare, which in its turn is controlled by F2i, the largest infrastructure fund in Italy with more than 5 billion assets under management.

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- 13:13 CEST

CIR: results for first half 2020

Revenues 856.7 million (€ 1.059,1 million in first half 2019)

EBITDA: € 103.8 million (€ 140.0 million in first half 2019)

EBIT: -€ 8.3 million (€ 46.0 million in first half 2019)

Net result: -€ 30.4 million

Net financial position of the parent company at € 397.1 million, higher than at December 31 2019 (€ 295.7 million)

Milan, July 31 2020 – The Board of Directors of CIR S.p.A., which met today under the chairmanship of Rodolfo De Benedetti, has approved the Semi-Annual Financial Report as of June 30 2020 presented by Chief Executive Officer Monica Mondardini.

Consolidated results

CIR’s results for the first half of 2020 were affected significantly by the strong impact that the spread of the Covid-19 pandemic has had on all the businesses of the group, i.e. social and healthcare services (KOS), the production of components for the automotive sector (Sogefi), and the management of the financial investments of the CIR holding company and its non-industrial subsidiaries.

KOS’s business was affected by the public health emergency in all sectors, with a significant impact on economic performance: in the care homes, activity was concentrated on the complex management of the public health emergency with new admissions on hold; the rehabilitation facilities reported a decline in the number of patients following the slowdown of normal activity with the health system under stress and activity focused on the emergency; outpatient services were suspended or severely limited as was diagnostic activity; meanwhile the company focused on putting in place the necessary measures for protection of staff and patients.

Sogefi’s business was seriously affected, as indeed was the case for all of the automotive sector, by the effects of the pandemic; production was suspended first in China and then, in the second half of March, in almost all of its plants. Currently, production in China has returned to monthly levels in line with the forecasts made before the crisis; in the remaining geographical areas, production resumed gradually as from May after the main customers returned to production, but volumes were still significantly lower than those pre- Covid. The situation remains particularly critical in Mercosur and India.

In the first half of 2020, the consolidated revenues of the CIR group came in at € 856.7 million and were down by 19.1% on 2019. After the first two months which saw growth of 9.7% on the corresponding period of 2019, the public health emergency caused an immediate and drastic contraction of revenues due mainly to the suspension of Sogefi’s production activity.

The consolidated gross operating margin (EBITDA) came to € 103.8 million and was down by 25.8% from the figure for the first half of 2019 (€ 140.0 million), following the trend of revenues; the consolidated operating result (EBIT) was a negative € 8.3 million versus a positive result of € 46.0 million in the first half of 2019.

The net result was a loss of € 30.4 million after earnings of € 1.6 million in the first half of 2019.

The consolidated net financial debt before IFRS 16 amounted to € 285.7 million at June 30 2020 and was down by € 42.0 million compared to the figure at December 31 2019 (€ 327.6 million). The financial payables for rights of use according to IFRS 16 totalled € 787.8 million at June 30 2020 and thus the total consolidated debt stood at € 1,073.5 million. The payables as per IFRS 16 refer mainly to the subsidiary KOS (€ 731.8 million), which operates mostly in leased premises.

The net financial position of the Parent Company (including the non-industrial subsidiaries) was a positive € 397.1 million at June 30 2020, higher than at December 31 2019 (€ 295.7 million), following the cash inflow from the sale of CIR’s entire interest in GEDI Gruppo Editoriale S.p.A. to EXOR (€ 102.4 million), completed on April 23 2020.

The equity of the Group stood at € 728.5 million at June 30 2020 versus € 770.7 million at December 31 2019 and the decline mainly reflects the loss for the period.

As regards KOS, its revenues came in at € 337.2 million, with a rise of 19.9% on the same period of 2019 thanks to the significant contribution of Charleston (the group acquired in October 2019, which operates in Germany in the care-home sector): on a like-for-like basis revenues fell by 10.6%.

EBIT was € 18.1 million, down from € 31.6 million in 2019, due not only to the decline in the number of guests and patients in Italy because of the Covid-19 emergency, as illustrated above, but also to the higher costs incurred for protection measures to counter and limit the effects of the pandemic. The first half closed with a loss of € 2.1 million compared to earnings of € 14.4 million in the first half of 2019.

Cash flow was positive for € 11.8 million and the net financial debt before IFRS 16 declined from € 368.0 million at December 31 2019 to € 356.2 million at June 30 2020.

As for Sogefi, automotive production worldwide fell by 33% in the first half of 2020 compared to the first half of 2019, with Europe and NAFTA, Sogefi’s main areas of activity, reporting -40%. In this scenario Sogefi’s revenues came in at € 519.5 million, posting a decline of 33.2% on 2019. In the main geographical areas the group reported a distinctly better performance than the market and, thanks to the cost cutting action taken, profitability (EBITDA/revenues %) declined by just two percentage points, from 11% to 9%. Despite this, EBIT came to -€ 18.8 million, after non-recurring charges of
approximately € 18.0 million, compared to +€ 24.4 million in the first half of 2019. The first half closed with a loss of € 28.8 million, which compares with net income for the first half of 2019 of € 6.9 million.

Net financial debt at June 30 2020 before IFRS 16 rose to € 327.0 million from € 256.2 million at the end of 2019, and the increase was due mainly to the rise in working capital caused by the drastic reduction in sales, which had an immediate effect on cash inflows; this increase should be reabsorbed gradually as business recovers.

Regarding the financial investments of the holding company and the subsidiaries devoted to financial management, given the turbulence and sell-offs in the financial markets, in the first half a loss of € 5.6 million was reported, which meant a negative return of -1.4%; the portfolio of bonds and hedge funds obtained an overall positive return of 0.7%, while losses of € 7.9 million were posted for fair value adjustments made to the investments in private equity and other equity investments.

Events that have occurred since June 30 2020

On July 13 2020, as was stipulated in the agreement of December 2 2019, CIR acquired a shareholding interest in the capital of Giano Holding S.p.A., which represents transparently 5% of the share capital of GEDI. The acquisition involved a disbursement of € 11.7 million, equivalent to a price of € 0.46 for each GEDI share.

Outlook for the year

The degree of uncertainty as to the evolution of the business and the results of the second half remains extremely high.

As far as KOS is concerned, towards the end of the first half there was an inversion of the trend with a recovery in rehabilitation activity, the acute sector and in diagnostics and oncology services; the care-home sector has stabilized but is not yet at the recovery stage. As things are at present, provided there is no second wave of contagion in the autumn, it is expected that the diagnostic areas, oncology treatments, psychiatrics and the acute sector could return to levels of pre-Covid activity during this year. For rehabilitation and the care-homes, the return to normal levels of activity is expected to take place in 2021. Moreover with reference to the care-home sector in Germany, it should be noted that the impact of Covid-19 was limited and the return to normality is expected to be by the end of this year.

In this scenario, it is therefore plausible that the reduction in revenues and results of the business reported in the first half will be less in the second half of the year.

As regards Sogefi, visibility as to the evolution of the market in the coming months remains limited both in terms of the uncertainty as to the evolution of the pandemic and of the difficulty in forecasting the impact of macro-economic circumstances caused by the same on demand in the automotive sector. For the second half of 2020, IHS Markit, a source commonly used by the sector, expects that, without a second outbreak of Covid-19 and resulting measures to restrict production and adverse effects of the latter on the market, world production could be at -10% compared to the second half of 2019, while market analyst forecasts tend to be more cautious, expecting a world market contraction in a range between -15% and -30%, the latter in the event of a second wave of Covid-19.

In this uncertain scenario, Sogefi has incorporated into its expectations for the second half of the year a world market scenario hypothesis of around -20%, against which it expects to achieve an EBIT, excluding restructuring costs, that is slightly positive, a significant reduction in the net loss compared to the first half and a slightly positive free cash flow.

Both companies, in the light of the totally exceptional circumstances that arose in the first half of the year, despite today having financial resources in excess of their current needs and not foreseeing any increase in their debt compared to the levels at the end of June 2020, given the uncertainty as to the evolution of the market and anticipating the natural expiry of their existing loans, have begun negotiations with their financial partners, with whom they have consolidated relationships, to ensure that they have sufficient funding available in the medium term.

In the light of the above, the CIR group expects the second half of the year to still be difficult but provided there is no second wave of Covid-19 it should be much better than the first half.

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- 13:33 CEST

Sogefi: results of first half 2020

Revenues: € 519.5 million, -31.2% at constant exchange rates (car market -33.2%)

Performance of revenues much better than that of the market in the main geographical areas in which the group is present

EBITDA: € 47.0 million, 9.1% of revenues (11.1% in first half 2019)

Fixed costs down by 27%

EBIT: -€ 18.8 million due to lower volumes and to non-recurring charges

EBIT and free cash flow expected to be positive in second half of 2020 provided there is no second lockdown

Milan, July 27 2020 – The Board of Directors of Sogefi S.p.A., which met today under the chairmanship of Monica Mondardini, has approved the Semi-Annual Financial Report of the group as of June 30 2020. Sogefi, a company of the CIR group, is one of the main global producers of automotive components in three sectors: Air and Cooling, Filtration and Suspensions.

KEY RESULTS FOR THE FIRST HALF OF THE YEAR

In the first half of 2020 the world car market suffered an unprecedented decline following the spread of the Covid-19 pandemic throughout the world and the resulting necessary restrictive measures adopted by local governments or applied independently by businesses with a view to protecting their workers and the population at large. These measures led to an almost total suspension of non-essential production activities and in particular of automotive production. This shutdown took place first of all in China and then in March and April in the remaining geographical areas. The current situation is that business has resumed everywhere, in China with volumes even greater than those of last year and in Europe and NAFTA with significantly reduced volumes. The most critical areas in terms of production are currently South America and India.

In the first half of the year world car production reported a decline of 33.2% compared to the same period of 2019: -41.7% in Europe, -39.9% in North America, -24.9% in Asia and -50.6% in South America. In June 2020 the market partly recovered (but with a shortfall vis-à-vis global volumes for 2019 reduced to -21.2%), driven mainly by the Chinese market (+14.1%); the performance of Europe and NAFTA also improved but still with very weak volumes (-31.2% and -24.3%, respectively). The situation in Mercosur still remains critical (-56%).

During the first half of the year the company’s top priority was the safety of its workforce. From the moment when news of the Covid-19 phenomenon in China was received, action was taken immediately to reduce the risk of contagion, starting with an increase in working from home. Subsequently all the health and safety precautions defined and required by the various local authorities or by the company were put in place in the factories and workplaces. In this context the company has revised its production procedures in all geographical areas to implement the safety protocols with regard to social distancing and the use of personal protection equipment.

Secondly, Sogefi has done all it can to mitigate the impact of the crisis and the resulting contraction in sales on results and on the company’s financial solidity; a plan was rapidly adopted to variabilize costs and limit cash consumption, and more specifically:

Lastly, the group has reformulated its medium-long term plan (2020-2024), with the aim of preserving profitability and cash generation despite the uncertain prospects regarding the recovery of the market. 

REVENUES

In the first half of 2020, Sogefi’s revenues came in at € 519.5 million and were down by 33.2% on the first half of 2019 at historical exchange rates and by 31.2% at constant exchange rates.

After the first two months of the year when revenues at constant exchange rates were up by 1%, as from March the effects of the Covid-19 pandemic were evident and became particularly serious in April (-79.5%) and May (-64.5%), while June saw a significant recovery with a considerably lower decline than in the same period of 2019 (-24.9%).

The performance of revenues at constant exchange rates was distinctly better than that of the market in the main geographical areas in which the group is present: -32.2% in Europe versus -41.7% for the market, -30.5% in North America versus -39.9% for the market, +4% in China versus -19.7% for the market. The overall decline in revenues was, however, in line with that reported by the world market because of the concentration of the group’s businesses in markets that have reported the greatest contractions (Europe and NAFTA), whereas it has a less significant presence in China, where the market decline was far more limited. 

Of the various business sectors, Filtration (where revenues declined by 25.7% at constant exchange rates) and Air and Cooling (-29.1% at constant exchange rates) reported a performance that was much less negative than that of the market thanks, for Filtration, to the fact that the OES and Aftermarket channels held up better and for Air and Cooling to the development of the portfolio of contracts particularly in North America. For Suspensions the crisis had a greater impact, with a fall in revenues of 38.2% at constant exchange rates, which reflects the greater concentration of business in Europe and Mercosur and the performance of the sector in these areas.

The dramatic reduction in volumes caused by the evolution of the market following the Covid-19 pandemic has had a very significant effect on the economic results of the group, despite the incisive mitigation measures adopted.

Indeed, EBITDA came to € 47.0 million versus € 86.4 million in the same period of 2019, mainly due to the collapse in volumes; profitability (EBITDA / Revenues %) was 9.1% and was only 2 percentage points lower than the figure for the same period of 2019 (11.1%), thanks to the cost variabilization measures put in place.

More specifically, the contribution margin improved slightly compared to the first half of 2019, from 29.4% to 29.8%, because of the favourable evolution of the relative cost of raw materials, which was due partly to market phenomena and partly to the plans implemented last year to reduce the relative impact of the purchase prices of steel needed for the production of suspension parts, which offset the impact of the inevitable production inefficiencies caused by the suspension and the resumption of production and by the low volumes.  

The relative impact of fixed costs rose by approximately 2 percentage points, an increase that was relatively limited considering the size of the collapse in revenues. This was thanks to the limitation measures adopted, some of which were temporary while others are destined to be become structural.

EBIT was a negative € 18.8 million versus a positive result of € 24.4 million in the first half of 2019. The reduction in EBIT reflects the reduction in EBITDA resulting from plummeting revenues but also includes the negative effect of the evolution of exchange rates for € 4 million (€ 1.8 million in the first half of 2019) reported by the group’s businesses in North and South America, restructuring charges for a total of € 7.3 million (€ 4.3 million in the first half of 2019) and the write-down of assets for € 6.4 million (€ 1.9 million in the previous year).

In terms of net result, the group reported a loss of € 28.8 million compared to earnings of € 6.9 million in the first half of 2019, after financial expense substantially in line with that of the previous year and tax gains of € 1 million versus tax charges of € 8.3 million in the previous year.

DEBT AND EQUITY

Regarding Free Cash Flow, in the first half of 2020 € 64.0 million were consumed compared to € 8.8 million in the first half of 2019. The reduction in business activity and thus in EBITDA led to a contraction of operating cash flow that was only partly offset by the lower outflow for investments. It should also be noted that around 80% of the amount consumed was due to the increase in working capital caused by the particular circumstances that occurred in the second quarter of the year. Indeed, as is generally the case in the sector, customer receivables are received more quickly than the timing of payment to suppliers, partly because of factoring. As sales plummeted in the second quarter, sums received from customers were lower, while disbursements to suppliers continued. This imbalance should gradually be absorbed as business recovers.

Net debt at June 30 2020 before IFRS 16 rose to € 327.0 million from € 256.2 million at the end of 2019 and € 267.3 million at the end of June 2019. Including the financial payables for rights of use, in accordance with IFRS 16, net financial debt stood at € 382.9 million at June 30 2020 compared to € 318.9 million at December 31 2019.

At June 30 2020 the group had committed credit facilities of € 194.2 million in excess of its debt and the covenants contained in the loan agreements were all being complied with.

At June 30 2020 shareholders’ equity, excluding minority interests, amounted to € 144.9 million (€ 188.7 million at December 31 2019).

RESULTS OF THE PARENT COMPANY SOGEFI S.P.A.

In the first half of 2020 the parent company Sogefi S.p.A. reported a net loss of € 5.8 million compared to net income of € 32.7 million in the same period of last year. In a particularly uncertain scenario in all of the countries in which the group operates, the distribution of dividends by the subsidiaries to Sogefi S.p.A. has been suspended.

IMPACT OF COVID-19 ON BUSINESS

Following the spread of the Covid-19 pandemic, Sogefi first suspended production in China and then in the second half of March suspended production in almost all of its facilities. At the present time, production in China has returned to monthly levels in line with the Company’s estimates made before the crisis. In the other factories production has gradually resumed since May, after their main customers started up again. However volumes are still significantly lower than forecast at the start of the year.

As regards the impact of the pandemic on the group, the pre Covid-19 forecasts had envisaged a performance of revenues in 2020 substantially in line with 2019. In the first two months of the year the Company achieved volumes higher than expected, followed by an extremely significant fall with a gradual recovery in June. Because of this, Sogefi reported revenues of € 519.5 million, down by 33.2% on the same period of the previous year; this reduction was almost entirely attributable to the effects of the crisis. The contraction in volumes, even though partly offset by the reduction in fixed costs, had a negative impact of around € 50 million on EBIT and € 39 million on the Net Result, and also led to a significant increase in debt.  

As well as reacting to reduce the impact of the crisis between March and today, the company also strove to adapt to the changed circumstances in the market and to quickly find a new economic and financial equilibrium, despite the scenario of reduced volumes such as today and which is also likely to be the case in the second half of the year and in 2021. 

OUTLOOK FOR THE YEAR

Visibility as to the evolution of the market in the coming months remains limited. With regard to the pandemic, if its containment in Europe would appear to be consolidated, its spread in North and South America has not yet reached the containment phase. There is also the risk of a second outbreak of Covid-19 and, lastly, at present it remains difficult to predict the impact of the macroeconomic conditions caused by the pandemic on demand in the automotive sector.

For the second half of 2020, IHS expects that, without a second outbreak of Covid-19 and resulting measures to restrict production and adverse effects of the latter on the market, world production could be at -10% compared to the second half of 2019, while market analyst forecasts tend to be more cautious, expecting a world market reduction in a range between -15% and -30%, the latter being the case in the event of a second wave of Covid-19.

In this uncertain scenario, Sogefi has incorporated into its expectations for the second half of the year a world market scenario of around -20%, against which it expects to achieve an EBIT, excluding restructuring costs, slightly positive, a significant reduction in the net loss compared to the first half and a slightly positive free cash flow.

Furthermore, in the light of the market outlook which is uncertain and is likely to remain so in the next few years, Sogefi has launched a plan for a significant reduction of fixed costs, which will be completed by the end of the first half of 2021, as well as actions to rationalize footprint and manage suppliers.

Even if today the Company has financial resources in excess of its current needs and although it does not foresee an increase in its debt compared to the end of June 2020.  In view of the uncertainty as to the evolution of the market and anticipating the natural expiry of existing loans, it has started negotiations with its financial partners, with whom consolidated relationships are in place, to renew existing loans and enter into new medium-term loans for a total value in the region of € 100 million.

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- 13:12 CEST

CIR acquires interest in Giano Holding

Milan, July 13 2020 – CIR S.p.A. – Compagnie Industriali Riunite has today acquired from EXOR an interest in the share capital of Giano Holding S.p.A., in accordance with what was set out in the investment agreement stipulated on April 23 2020 between CIR, EXOR N.V. and Giano Holding.

Giano Holding is the company controlled by EXOR, which, after acquiring the controlling interest in GEDI S.p.A. from CIR, launched a mandatory tender offer for the GEDI shares in circulation that it did not already own, at a unit price of € 0.46 per share.

After the conclusion of the offer and the reinvestment, CIR now holds an interest in the share capital of Giano Holding that represents transparently 5% of GEDI’s capital. The reinvestment was made for consideration of € 11,699,881.04 (corresponding, transparently, to a price of    € 0.46 for each GEDI share).

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