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UACN SHAREHOLDERS FORUM JANUARY 26, 2005

UACN SHAREHOLDERS FORUM JANUARY 26, 2005. Who is the Foreign Shareholder?. - A Leading Emerging Markets Private Equity Firm. 55 years experience investing in emerging markets companies as Actis or CDC and before that as the Commonwealth Development Corporation

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UACN SHAREHOLDERS FORUM JANUARY 26, 2005

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  1. UACN SHAREHOLDERS FORUM JANUARY 26, 2005

  2. Who is the Foreign Shareholder?

  3. - A Leading Emerging Markets Private Equity Firm • 55 years experience investing in emerging markets companies as Actis or CDC and before that as the Commonwealth Development Corporation • Management buyout from CDC Group plc in 2004: 60% owned by management, 40% UK Government • 96 professionals in 19 offices in Asia, Africa and Latin America • 26 partners with 6 years average experience at Actis • Over US$2bn funds under management

  4. is the Leading Private Equity Investor in Africa • Over 55 years of investment experience • 23 investment professionals in eight offices • Average team private equity experience of seven years • Track record of successful investment (US$75-100m per year) Cairo Casablanca Abidjan Lagos Nairobi Dar es Salaam Lusaka Jo’burg

  5. Sector Focus • Telecoms • Mining, oil & gas • Financial institutions • Manufacturing • Food retail • Property • Privatisations / infrastructure

  6. Identifies Management when needed Uses Network to assist Expansion How does add Value Strengthens CorporateGovernance • El Rashidi El Mizan, Egypt • Flamingo Holdings, Kenya • Protea, South Africa • Celtel, pan Africa • DFCU, Uganda • Medscheme, South Africa • Platmin, South Africa • TRAC, South Africa Attracts Further Capital

  7. Recent African success stories REALISED REALISED TRAC

  8. in Nigeria • West Africa Region run from Nigeria • Office re-established in 2000 in response to return to democracy • Focused initially on understanding the market and identifying possible opportunities

  9. in Nigeria – recent investments Recent Investments in the Past 12 months are: • The Palms Shopping Centre – Nigeria’s first international standard retail centre – US$40million commitment • Starcomms – Actis capital will provide US$20million plus to help fund growth • *UAC of Nigeria Plc – Actis Capital proposes up to US$25million to help fund growth ***(Proposed)

  10. How will Actis Investment Add Value to UACN?

  11. in UACN • Actis as an international company will help to reinforce the company’s reputation for good corporate governance and business principles. • Actis will give us access to their network – allowing UACN to forge necessary and relevant technical alliances for our various businesses (access to technology, systems and world class processes). • Additional Actis capital will allow us to actualise our growth potentials, confer critical mass, provide influence and leverage to define competitive agenda in key markets.

  12. in UACN • Ungear our business through substantial reduction in our borrowing thus freeing up earnings for distribution to shareholders and retention to finance further growth. • Actis Board representation will help in: • Setting out and supporting the implementation of appropriate business strategies • Providing international and industry best practice insights to board debates • Managing the risks facing the business

  13. Why Did We Not Disclose Information on the Proposed Investment Earlier?

  14. Disclosure • At the time of Rights Offer via Rights Circular dated 2nd September 2004, we had discussions but no deal. • Disclosure of an unfinalised discussion had significant reputation risk for the company if a deal did not materialise.

  15. Disclosure • Rights Offer of 1 (one) new ordinary share for every 4 (four) existing ordinary shares held still left a wide gap in our capital requirement of N5billion to implement our 2004 – 2006 plans. The additional capital requirement was stated in the Chairman’s letter of 2nd September, 2004 contained in the Rights Circular. • At that time the conservative nature of the Offer was viewed by the Board as both realistic and appropriate given the high clutter in the IPO/Capital Market in the last six months.

  16. Disclosure • Clearly there was a need to mitigate the risk of high under subscription and possible outright offer cancellation given the circumstances. • Confirmation of Actis firm offer was received during the offer with payment made to issuing house - FCMB CAPITAL MARKETS.

  17. What will UACN Do With Additional Funds?

  18. Use of Additional Funds • As indicated earlier our estimated funding requirement for effective execution of our plans 2004 – 2006 is N5billion • Estimated net proceeds from Right Offer is N2.7billion, to be used 60% for expansion and 40% for debt reduction. • We are still short by N2.3billion of our funding requirement. • If the proposed investment is approved, we will realise N1.7bn, still leaving a shortfall of N0.6bn, which will be generated internally from operations.

  19. Use of Additional Funds • Management intends to use the additional proceeds of N1.7bn as follows: • Further reduction of borrowing N0.8bn • Further development of Innscor Franchised Brands N0.3bn • Capacity improvements in existing businesses N0.3bn • IT and upgrade of financial systems and controls N0.3bn • We are confident that significant opportunities exist for us to enjoy first mover advantage in our food offerings in key cities where we are not currently present and in some, where critical mass will ensure scale and scope of economies.

  20. Going Forward

  21. The Future • UACN is a GOOD company but it can become a GREAT one. • For the reasons stated earlier, we need this additional investment. • In the 80’s and early 90’s UACN was the most capitalised stock. Today, it is not even in the top ten. Our near-term strategy is to get there. • UACN needs to secure a strategic partner/investor which can engage its international network and people to add value to the business and assist in development of its management team.

  22. The Future • The Board and Management are driving to deliver improved shareholder returns through a combination of dividends and share price growth. • Actis investment represents a laudable foreign direct investment in Nigeria. A clear vote of confidence in our business and its future. • The investment is a financing window which will be instrumental in creating value for our stakeholders (customers, shareholders, employees etc.)

  23. The Future • We ask you to share our confidence, optimism and passion for the business as we drive to achieve our goals and deliver value. • Let’s place UACN on a sound strategic and financial pedestal as it enters a new stage of its development. • Let’s take UACN to the Next Level: A Great Company.

  24. THANK YOU!!!

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