STRUCTURAL
MERGER
I N I T I AT I V E
FUEL
FOR
GROWTH
WARNING
The implementation of an eventual structural merger will require (i) the
prior completion of the foreseen law procedures, and (ii) the authorization
of the competent authorities and other entities as required in accordance
with Colombian law.
The financial statements with which Fitch Ratings issued the AAA score
ratification concept for Terpel Organization S.A., with a stable outlook on
January 14th 2014, with closing date November 30th 2013, are the financial
statements used in the merger process.
This document is presented for information purposes only and does not
constitute a value offer, nor legal or fiscal advice. The responsibility of any
decision taken after evaluating, under your own criteria, the information
here within is the sole responsibility of the recipient and their advisors.
BACKGROUND
Administrations
Independent
Advisors
Shareholders
Meetings
1
2
3
4
AUTHORIZE THE
EXPLORATION OF
ALTERNATIVES OF
CORPORATE
RESTRUCTURE
HIRE INDEPENDENT
ADVISORS
Boards of
Directors
ADVISE ON FINANCIAL
AND LEGAL ASPECTS
APPROVE MERGER
AGENDA
1
2
3
4
T E R P E L O R G A N I Z AT I O N
T O D AY
PURPOSES
OF THE MERGER
R E S U LT
OF THE MERGER
CLOSING
REMARKS
1
AGENDA
T E R P E L O R G A N I Z AT I O N
T O D AY
2
3
4
PURPOSES OF THE
MERGER
R E S U LT
OF THE MERGER
CLOSING REMARKS
MORE THAN
45
YEARS
MOBILIZING GROWTH
CREATION OF
TERPEL
ORGANIZATION
TERPELS
CREATION
1968
2001
1971-1993
TERPEL
B/MANGA IS
BORN
TERPEL MERGER,
SIE LISTING AND
CREATION OF
PROENERGÍA
2005-2008
2004
TERPEL
ORGANIZATION AND
GAZEL MERGER
2010
2009
CREATION OF SIE,
CONSOLIDATING 75%
OF TERPELS
REGIONAL
EXPANSION AND
GAZEL ADQUISITION
2013
2012
ACQUIRES
MAJORITY
PARTICIPATION
AND LISTING OF
PROENERGÍA
ISSUANCE
OF AAA
BONDS
2014
TERPELS’
CONSOLIDATION
PROCESS
FINALIZED
TERPEL
DEL
CENTRO
TERPEL
ORGANIZATION
TODAY
MULTILATIN
COMPANY WITH
PRESCENCE IN 6
COUNTRIES
EXTENDED SALE
POINT NETWORK*:
2,232 GAS
STATIONS AND 80
CONVENIENCE
STORES
TERPEL BRAND IS TOP
OF MIND
AMONG COSTUMERS AND
USERS
HIGH CREDIBILITY IN
BANKING AND CAPITAL
MARKETS
2,250
QUALITY JOBS**
* OT Sale points and subsidaries for december 2013
** Direct and indirect jobs within own service stations
TERPEL
ORGANIZATION
AVIATION
70%
COLOMBIA
VNG SERVICE
STATIONS
LIQUIDS SERVICE
STATIONS
47%
43%
TOTAL NATIONAL PARTICIPATION
45%
Note: Market share, source OT, December 2013
MARKET
SHARE
INDUSTRY
RETAIL LUBRICANTS
37%
21%
OPERATIONAL AND
FINANCIAL PERFORMANCE
FIGURES
INCOME
7.20
8.26
2009
2010
10.39
2011
12.08
2012
BILLION PESOS
13.84
2013
COMPOUND ANNUAL GROWTH 2009-2013:
18%
2,107 SS and
1,466 MM gal
2009
2,232 SS and
2,101 MM gal
2013
EBITDA
380,600
433,778
453,299
480,094
MILLION PESOS
544,619
Average EBITDA margin
2009 - 2013:
4.6%
2009
2010
2011
2012
2013
COMPOUND ANNUAL GROWTH 2009-2013:
Source OT. Figures exclude Peru and Chile. * Compound annual growth rate
Volume CAGR* 2009 – 2013:
9%
9.4%
DIVIDENDS DISTRIBUTED TO
SHAREHOLDERS
198,934
FIGURES
215,749
171,485
NET PROFIT
OT
166,073
Net
Average
Margin
2009-2013:
128,899
MILLION PESOS
2009
DIVIDENDS
PER SHARE
OT
PESOS
2010
2011
2012
990
615
521
404
521
Distribution of dividends
percentage 2013:
2009
2010
2011
2012
2013
60%
COP
580 mil MM
distributed to
shareholders since 2009
Source OT
1.8%
2013
1
2
AGENDA
T E R P E L O R G A N I Z AT I O N
T O D AY
PURPOSES
OF THE MERGER
3
4
R E S U LT S
OF THE MERGER
CLOSING REMARKS
THE MERGER
RESULTS IN A
MORE
CLEAR AND SIMPLE STRUCTURE
TODAY
AFTER
52.8%
47.2%
44.9%
TERPEL DEL
CENTRO S.A.
67.4%
SHAREHOLDERS
SHAREHOLDERS
100.0%
28.5%
28.46%
34.6%
20.5%
4.1%
IS THE MAJORITY SHAREHOLDER
100.0%
SOCIEDAD
FUSIONADA
PRODUCT
TODAY
4
3
2
1
SOCIETIES
REGISTERED AT RNVE**
LISTED IN BVC
OF THE CORPORATE
SIMPLIFICATION
AFTER
1
OPERATONAL
SOCIETY
LISTED IN
BVC*
OPERATIONAL
*BVC : Colombian Stock Exchange
**RNVE ISSUERS AND STOCK NATIONAL REGISTRY
Single Management
Center
1
Board of Directors
Administration
THERE WOULD BE A
HIGHER FREE-
FLOATING*
NOT LISTED
IN STOCK MARKET
TODAY
SHARE LISTING
AFTER
811 SHAREHOLDERS**
11.3% FREE-FLOATING*
583 SHAREHOLDERS**
1.8% FREE-FLOATING*
TERPEL DEL
CENTRO
A SINGLE COMPANY
LISTED IN THE STOCK
MARKET WITH
+1,700
34
SHAREHOLDERS**
303
SHAREHOLDERS
AND FREE-FLOATING*
ESTIMATED > AT 20%
SHAREHOLDERS**
* Free-floating: number of stocks held by investors without control interest (minor participation at 1% or considered an institutional investor)
** Number of shareholders in October 2013
Pre l imina ry info rma t io n
1
2
3
AGENDA
T E R P E L O R G A N I Z AT I O N
T O D AY
PURPOSES OF THE
MERGER
R E S U LT S O F
THE MERGER
4
CLOSING REMARKS
STATUTORY REFORMS DO
NOT AFFECT THE
FINANCIAL CONDITION OF
BOND HOLDERS
PRODUCT OF THE
MERGER
The subscribed and paid capital is
adjusted
-
The right of preference is eliminated in
share trade
-
Rules are established for share reacquisition
-
The
functions
of
the
General
Shareholders Meeting are broadened
- The functions of the Board of Directors
are modified
- The functions of the Auditing Committee
are modified
SOCIAL OBJECTIVE
MODIFICATION
- Food merchandising is included
- The ability to act as an intermediary
agent is included
ON THE BALANCE STATEMENT
PARTICIPATION
ELIMINATION
CROSSED WITH TC
3.41
(ACCOUNTING
EFFECT)
OT MANTAINS UNCHANGED ITS FLOW GENERATION
CAPACITY
Figures rounded to COP Billions closing at November 30, 2013.
1
Proform Balance of the merger
1.81
LIABILITY
1.90
LIABILITY
3.54
POST-MERGER1
SIE DEBT
COP 180,000 MM
EQUITY
ASSESTS
BEFORE THE MERGER
1.64
OT
MAIN
ADJUSTMENTS
1.60
EQUITY
OT
ASSETS
EFFECT OF THE
MERGER
THE MERGER MANTAINS
UNALTERED THE BONDHOLDERS
POSITION OF THE
NOVEMBER
2012
NOVEMBER
2013
FOR BOND ISSUANCE
POST-MERGER
COMPANY SCORE AND
BONDS
COMPANY SCORE AND
BONDS
AAA(Col) / F1+
AAA(Col) / F1+
STABLE
STABLE
PERSPECTIVE
PERSPECTIVE
REAFFIRMED ON JANUARY 2014
TAKING ON
180,000 MILLION PESOS OF SIE DEBT
Source: Fitch Ratings. 1 After perfection of the merger.
KEY
FACTORS
SCORE
SUPPORT FROM
COPEC, SCORED BBB1 INTERNATIONAL,
AS MAJORITY SHAREHOLDER
THE COMPANY HAS A STRONG COMPETITIVE POSITION
DIVERSIFIED IN GEOGRAPHIES AND PRODUCTS TO MITIGATE EXPOSURE TO
ECONOMIC CYCLES
STABLE CASH
FLOWS DERIVED FROM THE REGULATED NATURE OF THE
BUSINESS AND THE GROWING TREND OF FUEL CONSUMPTION
AFTER THE MERGER, LEVERAGE INDICATORS ARE MANTAINED AT MODERATE
LEVELS IN ACCORDANCE WITH THE
THE COMPANY
SCORE
MAINTAINS AN ADEQUATE
Source: Fitch Ratings 1 International risk score by Standard and Poor’s and Fitch Ratings
LIQUIDITY POSITION
1
2
3
AGENDA
4
T E R P E L O R G A N I Z AT I O N
T O D AY
BENEFITS OF THE
MERGER
R E S U LT S O F T H E M E R G E R
CLOSING
REMARKS
CLOSING REMARKS
THE
C O N S O L I D AT I O N
PROCESS OF TERPELS IS
FINALIZED
THE SHAREHOLDERS
B E L O N G TO A S I N G L E
O P E R AT I O N A L
AND
THE SOCIAL OBJECTIVE
A N D G R O W T H S T R AT E G Y
ARE NOT MODIFIED
SOCIETY
LISTED IN THE
S TO C K M A R K E T
THE AAA SCORE OF
T E R P E L O R G A N I Z AT I O N I S
M A N TA I N E D A F T E R T H E
MERGER*
* On November 19th 2013, Fitch Ratings affirmed the AAA(Col) score for the ordinary bond issuance of COP 700.000 million, and expect that the debt indicators remain in
accordance with the assingned score after the merger.
On January 14th, 2014, Fitch Ratings reaffirmed the score.
THANK YOU
WE INVITE
Y O U TO
CONTINUE
B E I N G PA R T
OF A
C O M PA N Y
WITH A
SUCCESFUL
H I S TO RY O F
GROWTH