Wiit — M&A Activity 2024

Jan 24, 2024

Informazione Regolamentata n. 20101-9-2024	Data/Ora Inizio Diffusione 24 Gennaio 2024 18:49:03		Euronext Star Milan
Societa'	:	WIIT
Identificativo Informazione Regolamentata	:	185606
Utenza - Referente	:	WIITNSS01 - PASOTTO
Tipologia	:	REGEM
Data/Ora Ricezione	:	24 Gennaio 2024 18:49:03
Data/Ora Inizio Diffusione	:	24 Gennaio 2024 18:49:03
Oggetto	:	WIIT_PR_New Acquisition in Germany, January 24, 2024
Testo del comunicato

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PRESS RELEASE

WIIT acquires the Edge & Cloud business from German Edge Cloud GmbH & Co. KG, a Friedhelm Loh Group subsidiary and continues its expansion in Germany The transaction is worth approximately Euro 6.5 million, including earn-outs

Milan, 24 January 2024 – WIIT S.p.A. ("WIIT" or the "Company"; ISIN: EN0005440893; WIIT.MI), one of the main European players in the cloud computing services market for enterprises, focused on the provision of continuous Hybrid and Private Cloud services for Critical Applications, announces that, today, WIIT AG, a fully owned subsidiary of WIIT S.p.A., has signed an agreement for the acquisition of the "Edge & Cloud" business unit with the German company German Edge Cloud GmbH & Co. KG ("GEC"), belonging to the Friedhelm Loh Group.

The Chief Executive Officer, Alessandro Cozzi and Francesco Baroncelli, Chief M&A Officer of WIIT commented:

"With this new acquisition we further strengthen our position in Germany. Indeed, we have not only acquired a portfolio of around 40 enterprise-level clients worth a total of approximately Euro 9 million in Annual Recurring Revenues (ARR), but also strengthened our team with 66 new colleagues. At a time when finding qualified personnel represents a key issue in our industry, having acquired this team with distinctive technical and commercial skills and many years of experience, together with such a relevant customer portfolio, allows us to start 2024 above the best expectations. Finally, we expect to realise more than Euro 3 million in cost synergies over the next 18 months, thanks to the consolidation of infrastructure and the utilisation of acquired resources".

WIIT AG CEO Christoph Herrnkind said:

"We are very proud to announce the addition of new colleagues to WIIT AG, who will strengthen the German team of 388 people, 460 enterprise customers, Euro 53.5 million in revenue and 16 data centers in the first nine months of 2023. This transaction is fully in line with our acquisition strategy as it will bring the Group significant cost synergies, both in terms of utilisation of the Düsseldorf data centers and highly specialised resources to support the significant organic growth expected in 2024".

1. Description of the business unit acquired

With today's transaction, WIIT AG, the WIIT Group company focused on the development of the German market, has acquired from GEC the business unit offering the following services:

• Cloud Services: infrastructure services and cloud computing with specific focus on data management, data analysis, virtual workstations, etc.;
• Edge Computing: edge computing appliances with ready-to-use software and hardware systems.

The business unit consists mainly of the following assets:

• approximately Euro 9.2 million in recurring revenues generated by a portfolio of 40 loyal customers;
• 66 employees with technical and commercial skills needed to provide such services;
• the hardware, software and other IP needed to run the business.

The Friedhelm Loh Group, from which the business unit is acquired, is a German industrial and technology group of businesses operating in the manufacturing and services sector, headed by Prof. Dr.-Ing. E.h. Friedhelm Loh. It has its headquarters in Haiger, Germany, and offices and production centres around the world. The Friedhelm Loh Group originated from a company founded in 1961, which produced and sold "the first mass-produced enclosures for electrical control systems". The group employs over 12000 people and generates revenues of Euro 3 billion. The main companies in the Group's portfolio are Rittal, EPLAN, Cideon, LKH, Stahlo and GEC.

2. Transaction details

The purchase price for the acquisition is composed of a base amount of Euro 2.5 million, to be paid at the closing of the transaction, and earn-out components of up to a maximum aggregated amount of Euro 4 million payable upon achievement of certain revenue based objectives.

The transaction encompasses the acquisition of all "Edge & Cloud" customer agreements, assets and 66 employees, who will transfer to the buyer.

The agreement envisages the release by the seller of representations and warranties, usual in this kind of transaction.

The closing of the transaction is subject to the fulfilment of certain customary conditions precedent.

3. Effect of the Transaction on WIIT

With this acquisition WIIT intends to seize the following opportunities:

• acquire a customer portfolio of 40 highly loyal customers generating a turnover of approximately Euro 9 million;
• expand into a new strategic geographical area (Frankfurt) for the further development of the group in Germany;
• achieve an annual EBITDA of approximately Euro 3 million after a period of integration into the WIIT group and the extraction of synergies;
• strengthen the team in Germany with the entry of new, highly qualified professionals to support the development plan for 2024 and thereafter.

* * *

PedersoliGattai and BMZ assisted the WIIT Group as legal advisors in the transaction; PwC acted as tax and accounting advisor.

* * *

This press release contains forecasts and estimates that reflect the current views of the Group's management regarding future events. Forecasts and estimates are typically identified by expressions such as "it is possible," "it should be," "it is forecast," "it is expected," "it is estimated," "it is believed," "it is intended," "it is planned," "objective" or by the negative use of these expressions or other variations of these expressions or by the use of comparable terminology. These forecasts and estimates include, but are not limited to, all information other than factual information, including, without limitation, that relating to the Group's future financial position and operating results, strategy, plans, objectives and future developments in the markets in which the Group operates or intends to operate. As a result of such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking information as a prediction of actual results. The Group's ability to achieve its expected results depends on many factors beyond management's control. Actual results may differ significantly from (and be more negative than) those predicted or implied by the forecast data. These forecasts and estimates involve risks and uncertainties that could have a material impact on expected results and are based on basic assumptions. The forecasts and estimates made therein are based on information available to the Group as of today. The Group does not undertake any obligation to publicly update and revise forecasts and estimates as a result of the availability of new information, future events or otherwise, subject to compliance with applicable laws.

WIIT S.p.A.

WIIT S.p.A., a company listed on the Euronext Star Milan ("STAR") segment, is a leader in the cloud computing market. The company has a pan-European footprint and is present in key markets, such as Italy and Germany, positioning itself among the leading players in the supply of innovative Hosted Private and Hybrid Cloud technology solutions. WIIT operates its own data centers in 6 regions - 4 in Germany and 2 in Italy - of which 2 are Premium Zone-enabled, i.e. with Tier IV data centers certified by the Uptime Institute and with the highest levels of security in the design phase. WIIT has 6 SAP certifications at the highest level of specialisation. Its end-to-end approach enables the company to provide its partner businesses with customised, high value-added services with the highest security and quality standards for the management of critical applications and business continuity, while guaranteeing maximum reliability in the implementation of the main international application platforms (SAP, Oracle and Microsoft). Since 2022, the WIIT Group has joined the United Nations Global Compact. (www.wiit.cloud)

For more information:

Investor Relations WIIT S.p.A.: Stefano Pasotto – CFO & Investor Relations Director Francesca Cocco – Lerxi Consulting – Investor Relations T +39.02.3660.7500 Fax +39.02.3660.7505 ir@wiit.cloud www.wiit.cloud

Media Relations:

Image Building Rafaella Casula Tel. +39 348 3067877 Simona Porcino Tel. +39 02 89011300 wiit@imagebuilding.it

Fine Comunicato n.20101-9	Numero di Pagine: 5
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