Aktsiaselts Infortar subsidiary AS Eesti Gaas acquires a 100% shareholding in EWE Polska

Aktsiaselts Infortar subsidiary AS Eesti Gaas acquires a 100% shareholding in EWE Polska

AS Eesti Gaas, a wholly owned subsidiary of Aktsiaselts Infortar (Infortar) and the German energy group EWE AG have entered into an agreement on the 31^st of October 2024, under which EWE AG will sell 100% of the shares of its wholly owned subsidiary EWE Polska sp. z o.o. (EWE Polska) which operates in Poland. EWE Polska has two wholly owned subsidiaries, EWE Energia sp. z o.o. and EWE Przesył sp. z o.o. (altogether EWE Polska group).
Chairman of the Management Board of Infortar Ain Hanschmidt:
"Our ambition is to expand beyond the Baltic-Finnish region into Central and Western Europe, implementing our proven model and experience as a gas supplier and network operator Poland, thereby delivering the best service to consumers. The acquisition of an energy company in Poland provides us with the necessary momentum in this large and important growing gas market, while also ensuring an additional steady cash flow for the company's shareholders."

The fields of activity of EWE Polska group include a natural gas distribution network in Western Poland and all business lines of energy sales (including gas and electricity sales).

The completion of the transaction requires approval from the Polish Competition Authority (Polish: Urząd Ochrony Konkurencji i Konsumentów), as well as corporate approval by the EWE AG Supervisory Board (German: Aufsichtsrat).

The acquisition of shares in EWE Polska constitutes a significant transaction under Nasdaq Tallinn Stock Exchange Rules and Regulations. Therefore, the Stock Exchange Release includes comprehensive information on the transaction's circumstances and EWE Polska's financial results.

EWE Polska is the second-largest privately-owned network operator in Poland. The company operates a natural gas distribution network of 2,316 km in western Poland, mainly around Poznan, serving over 25,000 clients. In addition to infrastructure management, the company sells natural gas and electricity, with energy sales totaling 1.2 TWh last year.

The aim of the transaction is to significantly expand Infortar's energy business in the Polish market, with the impact on the Infortar's consolidation group being adding estimated revenues of more than 100 million euros.
The acquisition of EWE Polska group increases our market presence in this large and important growing gas market, while also ensuring steady cash flow from regulated assets to our shareholders.

      1.   Terms of payment of purchase price for the shares of EWE Polska
The purchase price for shares of EWE Polska is 120 000 000 euros payable as monetary payment.
The purchase price will be paid at the completion of the transaction after being adjusted based on accrued interest and occurred leakage (if any).

      2.   EWE Polska's financial results
EWE Polska group total revenues in year 2023 amounted to 141.1 mEUR (2022: 133.2 mEUR and 2021: 76.4 mEUR) which is 6% higher than the year before and 85% higher than in year 2021. In 2023, earnings before interest, taxes, depreciation, and amortization (EBITDA) was -2.2 mEUR, compared to 15.6 mEUR in 2022 and 15.0 mEUR in 2021. In 2023, the consolidated net profit was -3.7 mEUR, compared to net profit of 10.5 m EUR and 10.0 mEUR in years 2022 and 2021 respectively.

EWE Polska group total assets in 2023 were 170.0 mEUR (2022: 182.4 mEUR and 2021: 156.5mEUR) including total fixed assets 115.8 mEUR that is 68% from total assets (2022: 63% and 2021: 69%). Total current assets in 2023 were 54.2 mEUR, including cash and equivalents 22.9 m EUR. In 2022 respective numbers were 66.7 mEUR and 20.7 mEUR. In 2021 the numbers were 48.1 mEUR and 16.2 mEUR.

Total Equity in 2023 was 115.5 mEUR (in 2022 total equity was 121.5 mEUR and in 2021 114.6 mEUR).
For more detailed information, please see appendix.

Based on the additional information provided to Infortar, there have been no adverse changes in the business operations of the EWE Polska group since the close of the 2023 financial year. Unaudited consolidated figures for the first eight months of 2024 have been presented to Infortar, showing consolidated sales of 74.6 mEUR (2023 8 months: 94.2 mEUR), an EBITDA of 15.2 mEUR (2023 8 months: 5.9 mEUR), and a net profit of 12.3 mEUR (2023 8 months: -2.6 mEUR).

      3.   Overview of the loans undertaken by EWE Polska
EWE Polska group has no outstanding loans in its consolidated balance sheet.

      4.   The structure of shareholders of EWE Polska
EWE Polska is 100% owned by EWE AG. Upon completion of the transaction 100% of EWE Polska shares will be acquired by Infortar's wholly owned subsidiary AS Eesti Gaas.

      5.   Information on significant court or arbitration proceedings involving EWE Polska
According to information provided to Infortar, the companies within the EWE Polska group are not engaged in any significant court or arbitration proceedings. While certain legal proceedings related to their regular business activities are ongoing, Infortar has grounds to believe that the outcomes of these proceedings are unlikely to have a material impact on the business activities of EWE Polska group companies.

      6.   Information on valid contracts between Infortar and EWE Polska
Currently there are no valid contracts between Infortar and EWE Polska group.

      7.   The composition of managing bodies of EWE Polska
The Management Board of EWE Polska currently consists of Mr. Krzysztof Noga and Ms. Agnieszka Bielewicz. The Supervisory Board has not been formed.

The contemplated transaction is not a transaction between related parties and the members of the Supervisory Board and the Management Board of Aktsiaselts Infortar have no personal interest in the transaction in any other way.

Aktsiaselts Infortar operates in seven countries, the company's main fields of activity are energy, maritime transport, and real estate. Aktsiaselts Infortar owns a 68.47% stake in Aktsiaselts Tallink Grupp, a 100% stake in AS Eesti Gaas and a versatile and modern real estate portfolio of approx. 113,000 m2. In addition to the three main areas of activity, Aktsiaselts Infortar also operates in construction and mineral resources, agriculture, printing, taxi business and other areas. A total of 104 companies belong to the Aktsiaselts Infortar group: 95 subsidiaries, 4 affiliated companies and 5 subsidiaries of affiliated companies. Excluding affiliates, Aktsiaselts Infortar employs 6,625 people.

Additional information:
Kadri Laanvee
Investor Relations Manager
Phone: +372 5156662
e-mail: [email protected]
www.infortar.ee/en/investor

Appendix Balance Sheet and Profit and Loss Statements of EWE Polska group