Hexagon Composites — M&A Activity 2016

Feb 15, 2016

Hexagon Composites acquires fuel systems integrator in Brazil

Hexagon Composites acquires fuel systems integrator in Brazil

Hexagon Composites ASA (HEX.OL) has agreed to acquire 67 % of a Brazilian entity

to pursue fuel systems opportunities for transit buses and heavy-duty trucks.

The company, to be named Hexagon Composites Brazil Ltda, will address market

opportunities primarily in South America and Africa. The remaining 33 % will be

held by Mr. Tony Bermudo. The Bermudo family, owner of a leading Brazilian

Compressed Natural Gas (CNG) integrator, will transfer all activities concerning

bus and truck systems building into Hexagon Composites Brazil Ltda.

The global market for CNG bus systems is growing strongly due to political

priorities enhanced by stable and attractive natural gas prices, combined with

increasing concerns over environmental emissions and particulates. Hexagon

Composites is, through Hexagon Bus Systems in Norway and Hexagon Lincoln in the

US, the global leader in type 4 CNG bus fuel systems, and the Brazilian

footprint enhances this leadership position further.

"Brazil houses several of the world's leading OEMs with significant bus building

capacity. We look forward to strengthening our relationships with customers and

suppliers in the region", says Jon Erik Engeset, CEO of Hexagon Composites ASA.

"We are very happy to become part of the Hexagon Composites Group. Access to the

leading tank technology on the market will significantly strengthen our

competitiveness and broaden our range geographically and segment wise", says

Tony Bermudo, Managing Director of Hexagon Composites Brazil Ltda.

The initial purchase price is USD 1 million (approx. NOK 8.5 million), and

Hexagon Composites will increase its ownership to 100% according to an earn-out

model at a later stage. Estimated turnover for Hexagon Composites Brazil Ltda in

2016 is expected to be in the range of USD 2 million (approx. NOK 17 million)

with good growth opportunities thereafter.

For more information:

Tore Johan Fjell, Senior Vice President, Hexagon Composites ASA

Telephone: +47 920 33 337 | tore.fjell@hexagon.no

Solveig D Saether, Communication Manager, Hexagon Composites ASA

Telephone: +47 906 34 977 | solveig.saether@hexagon.no

Hexagon Composites ASA is a publicly listed company with its headquarters in

Aalesund, Norway. The Group develops and produces composite pressure cylinders

and systems for storage and transportation of various gases.

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.

[HUG#1986016]