Mergers & Acquisitions between India and Europe

1. Mergers & Acquisitions between India and Europe 14:00/15:15- Panel 2

2. Mergers & Acquisitions between India and Europe Chairperson: R. SANKARAN, Advisor, Rothschild India • Sanjay BHANDARKAR, Managing Director,N M Rothschild & Sons (India) • Kalpesh KIKANI, Senior General Manager,ICICI Bank • Tim THOMAS, Chief Operating Officer,Bharti AXA Life Insurance Co. 14:00/15:15- Panel 2

3. India – Europe Connexion Sanjay BHANDARKARManaging Director N M Rothschild & Sons (India)

4. India – An Overview • GDP Growth rate amongst the highest in the world • Clocked at 8.4% last year and estimated c.9 % for the current year • 5th largest nation in the world in PPP terms (€ 3tn)* • Per Capita GDP (PPP) : €2,720* • Growth spurt led by manufacturing and service sectors • Highest FII inflow amongst emerging Asian economies in CY06 (€ 6.2bn) • FDI Inflows at € 5.5bn in FY 06 (40% YoY growth) • Among the four fastest developing BRIC economies in the world • Population of over 1bn with 54% less than 25 years old Note * - As of 2006 est

5. India – Developed Capital Market Capital markets • Has one of the most developed capital markets among emerging countries • Only BRIC country with Market Cap. higher than GDP • 115 companies with a Market Cap. greater than €1bn (As of 15th May 2007) • Substantial PE interest • Indian corporates have made aggressive cross-border acquisitions backed by • Funding from investors, hedge funds and banks • Government pursuing progressive liberalization and easing of FDI norms • 100% FDI allowed in most infrastructure sectors Source Rothschild analysis Note Indices rebased to 100 Foreign attractiveness Source A T Kearney Study 2005

6. Indian Companies Going Abroad • “The Indian Multinational” • A steel company in UK, an oil & gas explorer in Norway, a generic drug manufacturer in Germany; all have one thing in common - they are all flying the Indian tricolor • Value of outbound deals larger than inbound • In Jan-March 2007, 40 out-bound deals with a total value of € 15bn • Led by Tata-Corus, Hindalco-Novelis, Aban-Sinvest • Companies looking to expand their product portfolio, access new markets, technologies • From regional to global player

7. Indian Acquirers – European Targets • Indian companies on a massive acquisition spree in past 2 years • Led by Iron and Steel, Energy and Pharmaceutical sectors • More outbound deals than inbound deals in 2006 in value terms • Largest portion of outbound acquisitions in Europe (42%) followed by North America (24%) • Tata – Corus deal represents largest ever acquisition by an Indian company Source: Thomson Financial Note:1) 2007 figures are YTD 2) All completed Deals only

8. Indian Acquirers – European Targets Sectoral Split • Iron & Steel • Tata’s € 9.5bn acquisition of Corus Group PLC • Energy • Aban Offshore’s € 1.1bn acquisition of Sinvest ASA, an oil & gas E&P company • Suzlon Energy is currently in the process of acquiring German based REpower Systems • Has placed a competitive bid of € 710m • Pharma & Biotech • Dr. Reddy’s € 577m acquisition of German pharma major betapharm GmbH • Ranbaxy Laboratories acquired Romanian based Terapia SA for € 270m Source: Merger Market, Rothschild analysis Note:1) Includes all announced deals from 2004 till 2007 YTD 2) Excludes Tata – Corus deal

9. Indian Acquirers – European Targets Top 10 Deals (2005 – 2007YTD) Source: SDC, Merger Market, Rothschild analysis

10. European Acquirers – Indian Targets • European investment in India constantly on the rise • Majority of inbound investments seen in Telecom, IT and Financial Services sectors • Vodafone’s recent acquisition of Hutch’s 67% stake in Hutchison Essar • Largest ever acquisition by a foreign company in India Source: Thomson Financial Note:1) 2007 figures are YTD 2) All completed Deals only

11. European Acquirers – Indian Targets Sectoral Split • Telecom • Vodafone’s € 10.5bn announced acquisition of Hutch’s 67% stake in Hutchison Essar • In 2005, Vodafone also picked up 6% stake in Bharti Airtel for € 686m • Mining • UK based Vedanta Resources’ recent announced acquisition of 71% stake in Sesa Goa for € 972m • Cement • Swiss cement major, Holcim picked up 20% stake in Gujarat Ambuja Cement for € 466m Source: Merger Market, Rothschild analysis Note:1) Includes all announced deals from 2004 till 2007 YTD 2) Excludes Vodafone – Hutchison Essar deal

12. European Acquirers – Indian Targets Top 10 Deals (2005 – 2007YTD) Source: SDC, Merger Market, Rothschild analysis Note *- Through its Indian Subsidiary, Mysore Breweries

13. In Conclusion Cross border activity on a continuous rise • Number of cross border deals increased from 60 in 2004 to 266 in 2006 • A significant proportion of M&A activity (in terms of volume) was done by mid cap companies • Number of Indian companies that are able to do major acquisitions abroad is growing constantly • In the first few months of 2007, Indian M&A crossed € 26bn led by large cap companies like Tata, Suzlon, Hindalco (Birla group) • Easy availability of debt for acquisition financing • Inbound acquisitions constrained by limited availability of high quality companies

14. Tata Steel Dr. Reddy s Laboratories Azure Solutions Advised controlling Advised on the US$576m shareholders on their US$ acquisition of Betapharm, 140m disposal of Germany Advised on US$ 11.9bn shareholding to Subex acquisition of Corus Group Systems through a GDR plc issuance 2007 2006 2006 ICICI, IDBI, SBI ICICI IDBI EXIM Air Deccan Advised Indian Lenders to US$1.9bn disposal of Raising US$40m private Daewoo Motors (India) on assets of Dabhol Power equity from ICICI Ventures the monetisation of assets Company to Ratnagiri Gas and Capital International & Power Pvt Ltd (a JV between NTPC and GAIL) 2005 2005 2005 Foodland Entertainment Lanco Group Network (I) Ltd. Advised on induction of US$25m private equity Financial Adviser on fund financial partners in 600 infusion from Warburg raising MW coal based Pincus Amarkantak Power Project 2006 2004 2002 Rothschild India Office • Advised Tata Steel on € 9.3bn acquisition of Corus Group • Advised Dr Reddy’s € 577m acquisition of betapharm • Advised Azure on € 113m sale to Subex Systems • € 1.4bn Dabhol power project • Daewoo automobile plant in India • Air Deccan, first Indian LCC • Radio Mirchi, first private FM channel • Radha Krishna Foodland, first food distribution deal • Lanco Amarkantak power project, first coal based IPP in India

15. Mergers & Acquisitions between India and Europe 14:00/15:15- Panel 2

16. India-Europe M&A Kalpesh KIKANISenior General ManagerICICI Bank

17. Agenda M&A activity in India Trends in Indian outbound M&A Considerations in European deals

18. Increased corporate activity • Indian corporates aspiring to become market leaders in their business segments not only in India but also globally • Growth drivers • Strong growth in demand leading to increased utilisation of existing capacity • Product portfolio and service offering enhancement • Access to new technology and markets • Derisking the business …aided by easier access to capital supply…

19. Increased access to capital Private Equity Domestic Public issue ADR/ GDR issue ECB/ FCCB issue …reflecting in the sharp increase in M&A activity in the recent past…

20. Share of India in global market USD billion M&A activity in India * 2007 figure is estimated Source : Bloomberg • Value of Indian deals grew at a CAGR of 140 % from USD 8.3 bn in CY04 to USD 47.4 bn in CY06 • ICICI Bank was involved in USD 16.5 billion worth of deals in CY06 • Outbound M&A deals till March was USD 8.8 billion in 2007 • Estimated total outbound M&A projected to be more than USD 35.0 bn in 2007 • This appears to be just the beginning of the M&A wave in India

21. India-Europe M&A • Europe represents the region with the largest number of acquisitions from India • India’s share of outbound deals originating from Western Europe has increased from 5.0% to 8.5% between CY04 and CY06 • In value terms it has increased from USD 0.7 billion (CY04) to USD 3.1 billion (CY06)

22. Agenda M&A activity in India Trends in Indian outbound M&A Considerations in European deals

23. Explosive growth • India's M&A has grown by 150%, next only to France and Hong Kong, each of which achieved more than 200% growth • More than 80% of large Indian companies are exploring the M&A option to grow • India is second largest investor in the UK, with investments of around USD 2.0 billion (2005 - 2006) • Notable Deals in Europe • Aban Offshore acquires Sinvest, Norway for USD 1.3 billion (2007) • Tata Steel acquires Corus for USD 12.8 billion (2006) • Ranbaxy acquires Terapia for USD 324.0 million • Suzlon acquires Hansen, Belgium for USD 565.0 million (2006) • Dr Reddy's Lab. acquires Betapharm for Euro 480.0 million (2006) • Reliance acquires Flag Telecom for USD 207.0 million (2003) • Tata Tea acquires Tetley Tea for USD 430.0 million (2000)

24. Increasing leverage Target Debt/EBITDA levels in Western Europe Debt/EBITDA • Total Debt on target/EBITDA levels increased from 4.93 (2005) to 5.28 (2006) • Senior Debt/EBITDA levels also increased from 3.92 (2005) to 4.21 (2006)

25. Pricing Trends (W Europe) • Downward trend in Average Margins • Average Margins in 2006 : 238 bps (247 bps in 2005) Source : LoanConnector

26. Agenda M&A activity in India Trends in Indian outbound M&A Considerations in European deals

27. Key considerations in deal structuring • From a lender’s perspective • Key challenge is to get direct access to cashflows/assets of target (based in Europe) • Regulations differ across countries in Europe • UK has a whitewash procedure • Such is not available in other geographies

28. Financial Assistance in Europe

29. Key messages • Indian clients are increasingly looking at acquisitions for growth • The confidence level has increased and these companies are not shying away from acquisitions of much larger companies • Requirements of Indian clients are not necessarily same as for corporates in other geographies • Hence, solutions need to be tailored for Indian requirements • All key decision makers in ICICI Bank are based in Mumbai, thereby enabling quicker turn around in case of last minute changes in structure/ quantum of financing • ICICI Bank knows the people who are driving the acquisitions in India and thus in critical situations has the ability to look beyond numbers

30. Acquisition of 30% stake in Energy Brands Inc. USD 712 million Structuring and Lead Arranger Acquisition of Pinewood USD 118 million Sole advisor and arranger Acquisition of West Asia Drilling N.V. USD 33 million Structuring & Financing Acquisition of Thomson SA’s CPT plants USD 283 million Structuring & financing Acquisition of Carbogen Amcis USD 75 million Structuring & Financing Acquisition of Amann Holdings Euro 35 million Lead Arranger Acquisition of Sinvest A.S.A USD 800 million Structuring & Financing Acquisition Hansen Technologies USD 565 million Structuring & Financing Recent Transactions

31. Acquisition of spirits business of Shaw Wallace USD 300 million Advisor Acquisition of Typhoo Tea GBP 80 million Sole advisor and arranger Acquisition of 20.2% stake in Great Lakes Carbon, US USD 101 million Sole advisor and arranger Acquisition of Keyline Brands GBP 18 million Sole Arranger Employee buyout of Tata Tea plantations USD 13 million Advisor Acquisition of Tashkent Toytepa Textiles USD 103 million Structuring & Financing Acquisition of DCS Software GBP 12 million Sole Arranger Acquisition of a South African tyre manufacturer USD 62 million Guarantee facility Recent Transactions

32. Thank You

33. Mergers & Acquisitions between India and Europe 14:00/15:15- Panel 2

34. Indian Market Entry Experience Tim ThomasChief Operating Officer Bharti AXA Life Mumbai Wednesday, May 16, 2007

35. Launch Aug ‘06 1.0 Market entry - a phased approach Phase 1 Desk top analysis Apr-Jul 2004 Phase 2 Strategy & business case Aug-Dec 2004 Phase 3 Partner selection & planning Jan-May 2005 Phase 4 JV execution and operational design Sep 05-Mar 06 Phase 5 Implementation Oct ‘05-Aug 06 • Establish the viability of commencing a project to detail India market entry • Confirm scope, plan, and deliverables • Draft critical success factors • Agree project governance • Desk top data research • Initial view of potential in market • First filter of potential strategic partners • Strategy formulation for market entry into India and detailed business case examining viable entry options • Assess critical success factors for entry options • Evaluate potential partners interest and suitability and define preferred partner list • Joint Venture and structuring options • Evaluation of entry model options and optimal business model recommendation • Financial modelling and high level business case • Finalise partner negotiations, JV structuring and preparation of legal agreements • Detailed operational design (partner specific) • Marketing plan • Implementation planning covers: process, systems, infrastructure and back office, branch roll-out • Business planning and financials • Reporting and governance • Appoint key executives • Pre- launch and the 'start-up' phase preparation • Regulatory license approvals • Launch comms • Manpower recruitment • Sales force training, compensation and recruitment • Launch sales incentive programs/KPI tracking • Lead generation management • Establish JV committees • Establish a project team on the ground in India, consisting of AXA secondee, advance hire, implementation partners and external resources • Finalise partner selection for Management Board endorsement • Develop regulatory relations • Develop high level target operational model • Finalise advance hires short list

36. Thank you

37. Mergers & Acquisitions between India and Europe 14:00/15:15- Panel 2