CONFIDENTIAL JANUARY 2018

LAZARD SHAREHOLDER ADVISORY

European Shareholder Activism: 2017 in Review

Lazard has prepared the information herein based upon publicly available information and
for general informational purposes only. The information is not intended to be, and should
not be construed as, financial, legal or other advice, and Lazard shall have no duties or
obligations to you in respect of the information.
EUROPEAN SHAREHOLDER ACTIVISM: 2017 IN REVIEW CONFIDENTIAL

Review of Shareholder Activism in Europe – 2017

Shareholder activism in Europe is at a steady level, with 79 campaigns for the year, in line with 2016 all-time high
Various new European players such as Active Ownership Capital and Petrus Advisers are taking roots in the activism landscape while prominent US
funds are increasingly working on European large and mega-caps
Approaches to engaging with companies tend to converge towards a subtle mix of behind-the-scenes constructivism and public pressure
The investor landscape continues to evolve towards an activist friendly ecosystem

- Consolidation among active players and inflows into passive strategies are on the rise across Europe
- This trend is likely to accelerate in the near term, thereby increasing ownership concentration among European companies and thus giving more echo
to activists’ thesis
- Regulatory changes, with Mifid II and the Shareholders Rights directives, will likely favor development of shareholder activism
M&A and asset plays at targets are the major topics developed by activists to pursue value creation
- In a market ripe for M&A, event-driven activism and portfolio reshuffling are the main work streams of activists in their search for value

Activists increasingly ask for governance changes without necessarily demanding board representation
Management and board accountability are under close scrutiny from activists, as illustrated by the proxy fight launched by TCI at LSE
Small and mid-caps remain activists “sweet spot” in Europe

An increase in blue chip targets is nonetheless to be highlighted, mainly due to large US activists deploying capital in European companies, as
illustrated by Sachem Head at Shire, Third Point at Nestlé and Corvex at Clariant
Activism is expanding accross all European geographies, including Southern and Eastern Europe

Greece, Spain and Poland together account for c. 10% of campaigns, illustrated by important campaigns at blue chip companies such as Abertis and
OTE
With Europe going forward in a post-Brexit situation, activism is increasing on the continent
Source: Activist Insight, Activist Monitor, Press
Note: All following data as of 31/12/2017 1
EUROPEAN SHAREHOLDER ACTIVISM: 2017 IN REVIEW CONFIDENTIAL

Focus on 2017 Shareholder Activism in Europe

In 2017, Europe witnessed 79 campaigns

3 20 4

11
3

8
3
5

12

Examples of selected 2017 campaigns n # of campaigns as of 2017

Source: Activist Insight, Bloomberg, FactSet and Press Reports 2

Note: Campaigns refer to public actions by shareholders, towards a holding, to influence its strategy, governance, capital structure or reporting
All data is for activist campaigns targeting Europe-listed companies with market cap. greater than €100 million at time of campaign announcement
EUROPEAN SHAREHOLDER ACTIVISM: 2017 IN REVIEW CONFIDENTIAL

European Shareholder Activism League Tables

Top 10 Activist Investors – Most campaigns initiated (2015-2017)

Top 5 European regions targeted (2015-2017)

# of Campaigns Avg. Mkt Cap. of Targets

5 9 11 25 €1.9bn 1 UK – 65 Campaigns (16,29,20)

6 7 8 21 €11.8bn
3 FRANCE – 26 Campaigns (7,11,8)

21 5 8 €1.3bn
5 NORDICS – 20 Campaigns (8,6,6)

3 4 7 €20.8bn

3 21 6 €1.2bn 2 ITALY – 30 Campaigns (7,11,12)

4 GERMANY– 25 Campaigns (2,12,11)

2 3 5 €41.6bn

12 1 4 €24.2bn

WYSER-PRATTE 2 2 4 €1.3bn

12 3 €12.3bn

3 3 €0.6bn

2015 2016 2017

Source: Activist Insight, FactSet and public filings

Note: All data is for activist campaigns targeting Europe-listed companies with market cap. greater than €100 million at time of campaign announcement 3
EUROPEAN SHAREHOLDER ACTIVISM: 2017 IN REVIEW CONFIDENTIAL

Prominent Activists Making Larger Plays in Europe

Capital Deployment in European Campaigns Activists Globally Paid Significant Attention to Europe in 2017

Aggregate Market Value of New 2013 – 2016 2017

Activist Positions

2017 more than 2x 2013-16 average Europe

17% Europe
$21.6 27%
Europe accounted

Campaigns
for nearly 30% of
campaigns in 2017,
a 65% increase
over prior years
U.S. & Other U.S. & Other
83% 73%

2013–16 $10.7
$10.1 $9.9
Mean:$9.7
$8.2

Europe
19% Europe reached
Europe 35%of total activist

Capital Deployed
35% capital deployed in
2017 as ~$22 billion
went into new
European
2013 2014 2015 2016 2017 campaigns vs. an
U.S. & Other U.S. & Other average of ~$10
% of Total 81% 65% billion in 2013-16
Capital
Deployed 22% 14% 18% 27% 35%
By Activists
Globally

Source: Activist Insight, FactSet and public filings. 4

 EUROPEAN SHAREHOLDER ACTIVISM: 2017 IN REVIEW CONFIDENTIAL

Typology of Activists Involved in European Campaigns in 2017

In 2017, large US activists have deployed significant capital in Europe, with European funds still representing the majority of activist campaigns

2015-2017 Distribution of Activist Fund Types 2017 Distribution of Activist Fund Types

Examples of Longstanding European Funds

American Funds American Funds

28% 30% WYSER-PRATTE

New European Funds

21% New European Funds
26% Examples of New European Funds

Longstanding Longstanding
European Funds European Funds
51% 44%

Examples of American Funds

70% of campaigns in 2017 led by Activist Hedge Funds have been launched by European Funds

Source: Activist Insight, Activist Monitor

Note: New European Funds defined as funds founded after 2008 5
EUROPEAN SHAREHOLDER ACTIVISM: 2017 IN REVIEW CONFIDENTIAL

European Trends in Activist Campaigns Launched and Companies Targeted

Shareholder activism remains at a steady level in Europe in 2017, with funds focusing on M&A and Board composition topics to unlock value

Total activist campaigns in Europe Market cap. breakdown of targets

# of activist campaigns # of activist campaigns

2015 2016 2017
82 79

41 38
54
34

18
14 15
12 12 10 11
6 4
63% 50% 48% 11% 17% 15% 7% 15% 23% 19% 18% 14%
2015 2016 2017 €100m-€2bn €2bn-€5bn €5bn-€20bn €20bn+

Industry breakdown of targets Key campaign objectives

# of activist campaigns % of campaigns 2015 2016 2017

19 57%
17
48%
13 13 44% 41% 34%
11 32%
9 9 9
7 8 8 7
6 7 6 7 16%14% 15% 15%
6 6 5 6 10% 11%
6% 4% 7% 9% 9%9% 9%9%14%
3 4 4 4 4 4 4 4 3 6%5% 2%
2
Business Board Management Governance Operational Capital M&A / Sale of Breakup /
Strategy Change Change Return / Company Divestiture
Retail

Real Estate
Industrials

Telecom
Consumer

PEI

Healthcare

Technology

Media
Institutions
Financial

Structure

2015 2016 2017 c.1/3 of activist campaigns in the past 3

years targeted companies regarding
M&A transactions
Source: Activist Insight and FactSet 6
Note: All data is for activist campaigns targeting Europe-listed companies with market cap. greater than €100 million at time of campaign announcement
EUROPEAN SHAREHOLDER ACTIVISM: 2017 IN REVIEW CONFIDENTIAL

Activist Disruption of M&A – Selected European Cases

One-third of all 2017 campaigns were M&A-related, with activists playing a variety of roles, including pursuit of better deal terms (“bumpitrage”) and
opposing (often successfully) certain transactions on grounds of pricing or strategic fit
Activist Target Counterparty Activist Key Highlights

Elliott took ~10% stake in Arcam after previously thwarting a GE deal with SLM
GE ultimately increased offer to a ~20% premium over original offer

TCI, after building a 2.7% stake in Abertis, publicly stated that it strongly supported the offer
Successful by Atlantia to buy Abertis
“Bumpitrage”
TCI benefited from Abertis’ share price rally amid speculation of a counter offer from ACS

Structure required 75% shareholder approval, allowing Elliott to hold out on behalf
of minority holders despite 62% of shares already having approved
Private equity group agreed to pay ~12% premium to original price
Longstanding shareholder TCI publicly opposed Safran’s bid to acquire Zodiac Aerospace,
asking for a share repurchase scheme instead
Despite threatening Safran’s board with legal action, TCI failed to convince shareholders to vote
Opposition to against the merger, though the deal structure and price were revised
Announced
Transactions Dissident group White Tale opposed the merger as value destructive, growing an initial 7%
stake to 15% over two months
After the proposed merger was terminated under shareholder pressure, White Tale demanded 3
Board seats and a strategic review process

Knight Vinke refused tender its ~5% stake to the Finland-based bidder
Elliott disclosed a ~5% stake, but has not yet disclosedobjectives

Petrus Advisers publicly opposed the transaction a year after it was first agreed, delayed by
Ongoing Immofinanz needing to sell its Russian assets before the merger
Campaign Petrus reiterated its opposition to the merger the following semester, outlining its plan to create
value at Immofinanz in a full-fledged activist white paper
Elliott called the $110 per share opportunistic and estimated value at 23% higher
Elliott retained UBS to perform a financial analysis valuing the company at $136.50
per share

Source: Activist Insight, FactSet and public filings. 7

EUROPEAN SHAREHOLDER ACTIVISM: 2017 IN REVIEW CONFIDENTIAL

European Trends in Activist Board Representation

While being very aggressive towards poor governance practices, activist investors tend to less focus on seeking board representation

Board seats won Success rate of campaigns for Board seats

# of Board seats won In the past 3 years, activists obtained # of Board campaigns
124 board seats in Europe
47 41
42
35 13
26 25
25 29
19 6 8
28
17 18 20 17
16

2015 2016 2017 2015 2016 2017

Activist employees Success rate
40% 38% 46% as % of total 77% 68% 68%
as % of total
Activist employees appointed Successful Board campaigns

Number of Board seats won Manner of Board seats obtained

# of Companies # of Board representation campaigns

16 28
17
20 6
11
9 2 1
57%
6 6 5 15
2 4 1 2 13 14
2 1
45% 65% 30% 21% 18% 7
12% 5% 12% 20% 4% 12% 5 2
One Two Three Four + 2015 2016 2017
seat granted seats granted seats granted seats granted Settlements
25% 25% 12%
as % of total
2015 2016 2017 Campaigns settled Proxy access Proxy fight

Source: Activist Insight and FactSet

Note: All data is for activist campaigns targeting Europe-listed companies with market cap. greater than €100 million at time of campaign announcement 8