Cyfrowy Polsat S.A. — M&A Activity 2021

Mar 12, 2021

Entry into exclusivenegotiations regarding a potential acquisition of 10% of the sharecapital of eobuwie.pl S.A.

The Management Board ofCyfrowy Polsat S.A. (the "Company", "CyfrowyPolsat") hereby informs that upon having received an investmentproposal from representatives of CCC S.A. ("CCC", the "Seller")concerning the potential sale of a minority block of shares of thecompany eobuwie.pl S.A. ("eobuwie.pl"), in which CCC holdsindirectly 74.99% of the share capital and having conducted preliminarytalks with the representatives of the Seller, the Management Board ofthe Company made a decision on 11 March 2021 to enter into exclusivenegotiations with the Seller regarding a potential acquisition of 10% ofthe share capital of eobuwie.pl (the "Block of Shares")within the scope of pre-IPO investment for a consideration of PLN 500million for the Block of Shares (the "Investment"), whichimplies the total valuation of eobuwie.pl at PLN 5.0 billion.

In connection with the aboveon 11 March 2021 the Company signed a document with the Seller andanother investor containing a summary of the key conditions of thepotential Investment ("Conditions").

The Conditions provide thatthe Company and the other investor are granted exclusivity to conductnegotiations until 31 March 2021, during which the completion of the duediligence of eobuwie.pl is planned. The Company expects that in the casea final decision to execute the Investment is made, which would requirerelevant corporate consents on the part of the Company, a finalagreement stipulating, among others, detailed parameters and principlesof corporate governance of the Investment, shall be concluded by thedate indicated above.

Concurrently, the ManagementBoard of the Company informs that it views the potential Investment inthe Block of Shares as a financial investment, with a strictlydetermined way and timing of a potential exit which, according to theintentions of both parties, would be the initial public offering ofeobuwie.pl ("IPO") planned for 2022 or 2023, depending on marketconditions and other significant factors. At the same time, in theManagement Board's opinion, the potential Investment offers the chanceto gain experience in the promising field of e-commerce.

Taking into considerationthe very good results of eobuwie.pl and the dynamically growing marketsegment in which eobuwie.pl operates, the Management Board of theCompany believes that the potential Investment may generate anattractive rate of return, simultaneously giving the companies from thecapital group of the Company an opportunity to gain competencies inbuilding and developing operations in the field of e-commerce, whichconstitutes a natural development path for the Company's capital groupfollowing the acquisition of Interia.pl Group, of which the Companyinformed in current reports no. 16/2020 dated 30 April 2020 and 23/2020dated 2 July 2020. In connection with the above and on the basis ofinformation obtained from the Seller, the Management Board of theCompany assesses that the potential Investment may translate intobuilding long-term value for the Shareholders of the Company.

Concurrently, the ManagementBoard informs that at this stage it has not made any binding decisionswith respect to the execution of the Investment. Talks regarding theconditions of the Investment shall be conducted on an exclusivity basisand the outcome of the negotiations remains uncertain. The Company willpublish information on potential further decisions with respect to theInvestment in compliance with the binding provisions of law.