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Marc Verkuil DACT meeting Sr Director, Treasury & Tax November 12, 2010

Marc Verkuil DACT meeting Sr Director, Treasury & Tax November 12, 2010. SEQUENCE OF EVENTS. Jun 2008: spin-off (MBO). Nov 2008: merger. Jan 2010: asset sale. Feb 2010: establishment of new stand-alone business. 50/50% JV. APPLIED BIOSYSTEMS – INVITROGEN MERGER.

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Marc Verkuil DACT meeting Sr Director, Treasury & Tax November 12, 2010

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  1. Marc Verkuil DACT meeting Sr Director, Treasury & Tax November 12, 2010

  2. SEQUENCE OF EVENTS Jun 2008: spin-off (MBO) Nov 2008: merger Jan 2010: asset sale Feb 2010: establishment of new stand-alone business 50/50% JV

  3. APPLIED BIOSYSTEMS – INVITROGEN MERGER • highly leveraged with funding from >30 banks • different business, fiscal, and legal models • different ERP systems • Invitrogen management and culture leading • RBS (EMEA), Citi (APJ), JPM (US) • BofA (EMEA), HSBC (APJ), BofA (US) • zero-balance cash pooling in EMEA and APJ • principally no pooling • global in-house bank model & system • no in-house banking • standard, international straight-through processing • limited straight-through processing • structured cash flow hedging program • B/S exposures principally consolidated with in-house bank • opportunistic cash flow hedging program • B/S exposures with multiple entities

  4. APPLIED BIOSYSTEMS – INVITROGEN MERGER EUR Cash External cash balances finance company CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CZK Cash HUF Cash EUR ZBA NOK ZBA SEK ZBA Zero cash balances local entities DKK ZBA USD ZBA EUR ZBA EUR ZBA GBP ZBA RUB EUR ZBA USD ZBA PLN EUR ZBA CZK ZBA CHF ZBA ZAR USD ZBA EUR ZBA HUF ZBA EUR ZBA EUR ZBA EUR ZBA

  5. APPLIED BIOSYSTEMS – INVITROGEN MERGER EUR Cash External cash balances finance company CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CZK Cash HUF Cash EUR IHB NOK IHB SEK IHB In-house cash balances local entities DKK IHB USD IHB EUR IHB EUR IHB GBP IHB EUR IHB USD IHB EUR IHB CZK IHB CHF IHB USD IHB EUR IHB HUF IHB EUR IHB EUR IHB EUR IHB

  6. DUTCH FINANCE COMPANY FUNCTIONS Manufacturing Operations US Manufacturing Operations SG Royal Bank of Scot land USD ZBA USD ZBA GBP ZBA Product (& Service) Receivables JPY ZBA SEK ZBA (EMEA only) SGD ZBA Ci t ibank NOK ZBA Factoring Company AUD ZBA DKK ZBA NZD ZBA EUR ZBA Cash Management Center FX Management Center KRW CHF ZBA Dutch finance company CNY HUF ZBA In-House Bank & Netting Center TWD CZK ZBA THB PLN NOK IHB PLN IHB HUF IHB JPY IHB AUD IHB GBP IHB SEK IHB DKK IHB CHF IHB CZK IHB USD IHB NZD IHB KRW CNY TWD THB PLN ZAR Payables Center (SAP upload) (Europe, EMEA, Japan, APAC, x-border North-America)

  7. APPLIED BIOSYSTEMS – INVITROGEN MERGER EUR Cash External cash balances finance company CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CZK Cash HUF Cash EUR ZBA NOK ZBA SEK ZBA Zero cash balances local entities DKK ZBA USD ZBA EUR ZBA EUR ZBA GBP ZBA RUB EUR ZBA USD ZBA PLN EUR ZBA CZK ZBA CHF ZBA ZAR USD ZBA EUR ZBA HUF ZBA EUR ZBA EUR ZBA EUR ZBA

  8. APPLIED BIOSYSTEMS – INVITROGEN MERGER EUR Cash EUR Cash External cash balances finance company CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CZK Cash HUF Cash EUR ZBA NOK ZBA EUR Cash NOK Cash SEK ZBA SEK Cash Zero cash balances local entities DKK ZBA DKK Cash USD ZBA EUR ZBA EUR ZBA GBP ZBA RUB EUR Cash GBP Cash EUR Cash EUR ZBA USD ZBA PLN EUR Cash EUR ZBA CZK ZBA EUR Cash CHF ZBA ZAR CHF Cash USD ZBA USD Cash EUR ZBA HUF ZBA EUR Cash EUR ZBA EUR Cash EUR ZBA EUR Cash EUR ZBA

  9. APPLIED BIOSYSTEMS – INVITROGEN MERGER EUR Cash EUR Cash External cash balances finance company CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CZK Cash HUF Cash EUR ZBA NOK ZBA EUR ZBA NOK ZBA SEK ZBA SEK ZBA Zero cash balances local entities DKK ZBA DKK ZBA USD ZBA EUR ZBA EUR ZBA GBP ZBA RUB EUR ZBA GBP ZBA EUR ZBA EUR ZBA USD ZBA PLN EUR ZBA EUR ZBA CZK ZBA EUR ZBA CHF ZBA ZAR CHF ZBA USD ZBA USD ZBA EUR ZBA HUF ZBA EUR ZBA EUR ZBA EUR ZBA EUR ZBA EUR ZBA EUR ZBA

  10. APPLIED BIOSYSTEMS – INVITROGEN MERGER EUR Cash EUR Cash External cash balances finance company CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CZK Cash HUF Cash EUR IHB NOK IHB EUR IHB NOK IHB SEK IHB SEK IHB In-house cash balances local entities DKK IHB DKK IHB USD IHB EUR IHB EUR IHB GBP IHB EUR IHB GBP IHB EUR IHB EUR ZBA USD IHB EUR IHB EUR IHB CZK IHB EUR ZBA CHF ZBA CHF IHB USD IHB USD IHB EUR IHB HUF IHB EUR IHB EUR IHB EUR IHB EUR IHB EUR IHB EUR IHB

  11. DUTCH FINANCE COMPANY FUNCTIONS Manufacturing Operations US Manufacturing Operations SG USD ZBA USD ZBA USD ZBA USD ZBA HSBC GBP ZBA GBP ZBA Product (& Service) Receivables JPY ZBA DB JPY ZBA SEK ZBA (EMEA only) SEK ZBA SGD ZBA SGD ZBA NOK ZBA Factoring Company NOK ZBA RBS CI T I AUD ZBA AUD ZBA DKK ZBA DKK ZBA NZD ZBA NZD ZBA EUR ZBA EUR ZBA FX Management Center KRW Cash Management Center CHF ZBA CHF ZBA Dutch finance company CNY HUF ZBA In-House Bank & Netting Center TWD CZK ZBA THB PLN USD IHB NOK IHB PLN IHB HUF IHB JPY IHB AUD IHB CNY GBP IHB SEK IHB DKK IHB CHF IHB CZK IHB NZD IHB KRW TWD THB USD IHB GBP IHB SEK IHB NOK IHB DKK IHB CHF IHB JPY IHB AUD IHB NZD IHB ZAR Payables Center (SAP upload) (Europe, EMEA, Japan, APAC, x-border North-America)

  12. SEQUENCE OF EVENTS Jun 2008: spin-off (MBO) Nov 2008: merger Jan 2010: asset sale Feb 2010: establishment of new stand-alone business 50/50% JV

  13. DANAHER ASSET DEAL: AB SCIEX VENTURE • only assets & liabilities acquired, all dedicated manufacturing, R&D, sales, service & support associates transferred (plus a small group of others) • no legal entities, no registrations, no IT (no systems), no finance, no HR, no distribution, no offices, etc • two former JV partners: different ERP systems, different teams/cultures, different processes, etc • transitional services agreements with Life Technologies (and MDS) • RBS (EMEA), Citi (APJ), JPM (US) • wide range of banks • zero-balance cash pooling in EMEA and APJ • primarily notional cash pooling with multiple local banks • global in-house bank model & system • no in-house banking • uniform, international straight-through processing • limited straight-through processing • no hedging at all • B/S exposures principally consolidated with in-house bank

  14. DANAHER ASSET DEAL: AB SCIEX VENTURE USDCash EUR Cash GBPCash Notional pool balances finance company EUR Cash External cash balances finance company CHF Cash USD Cash DKK Cash NOK Cash GBP Cash SEK Cash CZK Cash HUF Cash EUR ZBA NOK ZBA SEK ZBA Zero cash balances local entities DKK ZBA USD ZBA EUR ZBA EUR ZBA GBP ZBA RUB EUR ZBA USD ZBA PLN EUR ZBA CZK ZBA CHF ZBA ZAR USD ZBA EUR ZBA HUF ZBA EUR ZBA EUR ZBA EUR ZBA

  15. Marc Verkuil DACT meeting Sr Director, Treasury & Tax November 12, 2010

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