MAKOR FLASH-LIGHT Aug 12, 2015 March 2, 2016 EUROPEAN HOLDING COMPANIES UPDATE: Long MF FP/Short BVI FP+SGO FP Shares of Wendel (MF: FP) are trading at a 31% discount to current NAV (based on March 1 closing prices), up from December low of 22%. As can be seen in the graph below this is the highest level of the past two years trading history. Looking at a larger time interval of the past 5 years, the highest level was approx. 40% and was observed during the European financial crisis in mid-2012. The bearish sentiment in global equity markets over the past two months has led to widening of the discounts across almost all holding companies with Wendel being more aggressively impacted (currently it has one of the highest discounts among major European companies), on the back of two main factors: First, Wendel has a higher leverage compared with other holding companies (such as RF: FP and GBLB: BB that have cash balance and lower debt), and current LTV is approx. 36%. Second, following €2b investments over the past three years the portion of the unlisted portfolio has risen significantly and is now 40% of the total gross assets (compared with only 10% in 2012). Naturally, with the bearish sentiment, the market doesn’t favor these two factors leading to the significant widening of the discount. This creates, to our view, a good opportunity to steadily start built a position in on one of France’s main industrial holding companies that has been outperforming the CAC over time. Wendel historic discount to NAV and NAV per share over the past 5 years: What to expect in 2016 - Wendel’s management held an investor day in early December and discussed its strategy for 2016 which will be to focus on current portfolio value creation. Though management didn’t roll out possible new investments in a broadened investment scope, we don’t expect a significant new acquisition in 2016, at least not without disposals (especially given large acquisitions made over the past year). Management is expected to present the market a new strategy only in late 2016 as the goals of the previous plan have been reached two years ahead of schedule. Makor Securities Makor Capital Makor Capital Markets Makor Securities London Ltd Rogovin Tower Makor Securities London Ltd Makor Securities London Ltd 7/8 Savile Row 2nd Floor Menachem Begin 11 (Geneva Rep Office) (Paris Rep. Office) London W1S 3PE, ENGLAND 52689 Ramat Gan, ISRAEL 27 rue de la Croix-d’Or 51 rue Francois Premier +44 207 290 5777 +972 3 545 3777 1204 Geneve, SWITZERLAND 75008 Paris, FRANCE +41 223 106 916 +33 1 42 99 69 41 4