Electrical Products Market UpdateAugust 2018

Investment Bank for the Manufacturing Sector SM

INDUSTRY EXPERTISE | GLOBAL PERSPECTIVE

www.ioadvisors.com

Electrical Products Index

▪ InterOcean actively tracks the electrical products market. The InterOcean Electrical Products Index provides a representation of current public company valuation multiples

1

▪ TEV/EBITDA multiples for electrical products companies in the Index are currently higher than at any mid-year point in the last four years

*TEV = Total Enterprise ValueSource: S&P Capital IQ as of July 31, 2018

Company Revenue (mm) EBITDA (mm) EBITDA Margin TEV/EBITDA Market Cap (mm)

1. ABB Ltd 35,520$ 4,796$ 13.5% 11.8x 48,920$

2. AMETEK, Inc. 4,609$ 1,208$ 26.2% 16.2x 18,017$

3. Bharat Heavy Electricals Limited 4,430$ 309$ 7.0% 9.7x 3,961$

4. China XD Electric Co., Ltd. 2,282$ 236$ 10.4% 9.0x 2,708$

5. Dongfang Electric Corporation Limited 5,075$ 193$ 3.8% NM 3,236$

6. Eaton Corporation plc 21,162$ 3,657$ 17.3% 11.8x 36,038$

7. Emerson Electric Co. 16,538$ 3,484$ 21.1% 13.9x 45,543$

8. EnerSys 2,582$ 333$ 12.9% 10.6x 3,456$

9. Enphase Energy, Inc. 303$ 2$ 0.8% NM 576$

10. Generac Holdings Inc. 1,840$ 362$ 19.7% 12.7x 3,330$

11. Hubbell Incorporated 4,026$ 692$ 17.2% 12.4x 6,751$

12. Legrand SA 6,809$ 1,489$ 21.9% 15.0x 19,614$

13. Mitsubishi Electric Corporation 40,388$ 4,208$ 10.4% 6.2x 28,973$

14. NARI Technology Co., Ltd. 3,959$ 772$ 19.5% 13.9x 10,690$

15. Nidec Corporation 13,793$ 2,170$ 15.7% 20.3x 42,766$

16. Regal Beloit Corporation 3,426$ 476$ 13.9% 10.1x 3,780$

17. Rockwell Automation Inc. 6,604$ 1,361$ 20.6% 16.8x 23,101$

18. Schneider Electric S.E. 29,036$ 4,695$ 16.2% 11.3x 45,125$

19. Sensata Technologies Holding PLC 3,460$ 879$ 25.4% 13.2x 9,226$

20. Shanghai Electric Group Company Limited 13,170$ 763$ 5.8% 16.2x 11,932$

21. Siemens Aktiengesellschaft 96,651$ 10,877$ 11.3% 12.9x 117,923$

22. SolarEdge Technologies, Inc. 793$ 151$ 19.0% 16.3x 2,397$

23. Sunrun Inc. 569$ (48)$ -8.4% NM 1,541$

24. TBEA Co., Ltd. 6,077$ 768$ 12.6% 8.4x 3,767$

Median 14.8% 12.7x 9,958$

www.ioadvisors.com

Recent M&A Activity

▪ The pace of M&A activity among electrical products companies has accelerated in 2018

2

Select Transactions

Close Date Acquirer Target Target Description

Jul2018

Thurmelec ALSATRONIC SA Designs and manufactures electronic cards and systems.

Jul2018

Nidec Corporation CIMA S.p.A. Designs, manufactures and delivers asynchronous electric motors.

Jul2018

Innogy e-mobility US LLC Broadband TelCom Power, Inc. Manufactures power conversion and charging solutions.

Jun2018

Trilantic Capital Management LLC

Sunbelt Transformer, Ltd. Provides new and reconditioned transformers and electrical distribution equipment for commercial and industrial markets worldwide.

Jun2018

Prysmian S.p.A. General Cable Corporation Develops, designs, manufactures, markets and distributes copper, aluminum and fiber optic wire and cable products for the energy, industrial, construction, specialty and communications markets.

Jun2018

Electronics plc Precision, Inc. Designs, manufactures and markets magnetic components, including current, switch-mode, power pulse, linear single phase, linear three phase, voice band, isolation, signal and DSL transformers, air coils, inductors/chokes/reactors, antennas and telemetry coils.

Jun2018

Enerejisa Enerji A.S. Esarj Elektrikli Araclar Sarj Sistemleri A.S.

Manufactures electric vehicle charging solutions.

Jun2018

Sumitomo Heavy Industries, Ltd.

Lafert S.p.A. Manufactures and supplies customized engineered electric motors and drives with a focus on industrial automation, energy saving and renewables.

Jun2018

Cerberus Capital Management, L.P.

Electrical Components International, Inc.

Manufactures wire harnesses and leads, subassemblies and other value-added assemblies.

Jun2018

ABB Ltd. GE Industrial Systems Manufactures technological products that are used to distribute, protect and control electrical power and equipment, including arresters, automatic transfer switches, automation software, busway, battery powered equipment, capacitors, circuit breakers, controllers, drives, energy management products, fuses, generators, hybrid control systems and I/O blocks and controllers.

www.ioadvisors.com

Recent M&A Activity (continued)

3

Select Transactions

Close Date Acquirer Target Target Description

May2018

CellCube Energy Storage Systems Inc.

EnerCube Switchgear Systems Inc.

Provides custom and off-the-shelf electrical equipment and systems to heavy power users, pipeline companies, refineries, manufacturers, municipalities and infrastructure providers; products include electrical switchgears, motor control switchers and solar power inverters.

May2018

Coolisys Technologies, Inc. Enertech Systems 2001 Ltd. Designs, develops and manufactures electrical and electronic systems for the military market in Israel and internationally.

May2018

Measurestep Enterprises Limited

AS Rigas Elektromasinbuves rupnica

Manufactures and sells electric machines and machinery, including electric motors, generators, transformers and other products for railway stock, metro, dump trucks and public urban transport.

May2018

Exide Technologies Aker Wade Power Technologies LLC

Designs, manufactures, installs and services charging and power conversion systems.

Apr2018

TransDigm Group Incorporated

Extant Components Group Holdings, Inc.

Manufactures and supports mission critical electronics and avionics systems for commercial, military, business and general aviation applications.

Apr2018

Mersen S.A. IDEALEC SAS Develops and manufactures laminated electrical bus bars.

Apr2018

NorthCapital Holdings ApS Starz GmbH Designs and manufactures cable harnesses, steering-electrics and instrument and control panels.

Apr2018

Power Grid Components Inc.

Instrument Transformer Equipment Corporation

Manufactures instrument transformer products for revenue metering and protective relaying applications in the electrical and electric utility industries.

Apr2018

Sodero Gestion CEPA SAS Manufactures electrical and electronic assemblies and sub-assemblies for the defense, industrial, medical, aeronautical, transportation and rail industries.

Apr2018

Black Swan Technology SAS Electronique Technologie SAS Manufactures electrical, electro technical and mechatronic equipment.

Apr2018

Sino-Platinum Metals Co., Ltd.

Sino-Platinum Longsun Alloy Co., Ltd.

Manufactures electrical contact materials including rivets and wires.

www.ioadvisors.com

Recent M&A Activity (continued)

4

Select Transactions

Close Date Acquirer Target Target Description

Apr2018

Supercomal Medical Products

Supercomnet Technologies Berhad

Manufactures, assembles, and sells PVC compounds and cables/wires for electronic devices and data control switches in Malaysia, the U.S., the Republic of Singapore and Taiwan.

Mar2018

Moog Inc. VUES Brno s.r.o. Designs, manufactures and tests special and non-standard electric rotating machines, electric drives and test stands with dynamometers.

Mar2018

GTCR, LLC EaglePicher Technologies, LLC Designs, manufactures and supplies batteries, battery management systems and energetic devices for defense, aerospace, commercial and medical customers.

Mar2018

Milab Marketing Sdn. Bhd Suluk Damai Sdn Bhd Engages in the business of electrical, mechanical, motor and generation of power including all forms of renewable energy power generation.

Mar2018

Onward Capital LC Connecticut Electric, Inc. Manufactures and markets electrical products, including replacement breakers, packaged replacement circuit breakers for POS, manual generator transfer switch kits, mini-breakers and load center accessories and power outlets.

Feb2018

Tom Richards, Inc. Dynatronix, Inc. Designs and manufactures pulse, pulse reverse and direct current power supplies for the metal finishing industry.

Feb2018

Lithium Werks B.V. Valence Technology Inc. Develops, manufactures and sells energy systems utilizing its proprietary phosphate-based lithium-ion technology primarily in the U.S. and Europe.

Feb2018

Scott Industrial Systems Inc. Sun Coast Hydraulic Electrical Mfg. Inc.

Manufactures electrical panels, VFD control system, industrial PLCs, HMI interface packages, odor control system and hydraulic power units for car wash and waste recycling industries.

Feb2018

NIBE Industrier AB Gaumer Company, Inc. Designs and manufactures electric process heaters, systems and controls for the power generation, refining/petrochemical and oil and gas industries.

Jan2018

Norgren Inc. Bimba Manufacturing Company, Inc.

Manufactures pneumatic, hydraulic and electric actuators and air preparation and motion control products.

Jan2018

Preh GmbH E-power Nordic AB Manufactures power electronics which include board chargers, converters and inverters.

Source: S&P Capital IQ

www.ioadvisors.com

Recent Acquisitions by Index Companies

▪ Over half of the firms in InterOcean’s Electrical Products Index made at least one acquisition since the beginning of 2018

▪ With the strong valuations in the public market, we anticipate that M&A activity will remain strong through 2018 – with continued high valuation multiples for attractive target companies

5

Index Company# of Acquisitions inLast Six Months* Acquisition Notes

ABB Ltd 1 Electrical power and equipment controls

AMETEK, Inc. 4Camera and communication systems, aerospace and industrial components

Bharat Heavy Electricals Limited 0 N/A

China XD Electric Co., Ltd. 0 N/A

Dongfang Electric Corporation Limited 0 N/A

Eaton Corporation plc 0 N/A

Emerson Electric Co. 6Pneumatic components, industrial tools, temperature instruments and software

EnerSys 0 N/A

Enphase Energy, Inc. 1 Solar energy components

Generac Holdings Inc. 1 Power generation products

Hubbell Incorporated 1 Smart infrastructure solutions

Legrand SA 4 Data center, electrical equipment and UPS systems

Mitsubishi Electric Corporation 1 Sorting solutions for sheet metal processing

NARI Technology Co., Ltd. 0 N/A

Nidec Corporation 2Refrigeration compressors, electronic components and automation products

Regal Beloit Corporation 1 Industrial fan products

Rockwell Automation Inc. 0 N/A

Schneider Electric S.E. 0 N/A

Sensata Technologies Holding N.V. 0 N/A

Shanghai Electric Group Company Ltd. 1 Polysilicon products

Siemens Aktiengesellschaft 6 Transportation equipment and software

SolarEdge Technologies, Inc. 1 Power supply equipment

Sunrun Inc. 0 N/A

TBEA Co., Ltd. 0 N/A*closed and pendingData as of August 4, 2018

www.ioadvisors.com6

› Increased corporate cash flow from tax law changes

› Growth in residential and commercial construction

› Rapid urbanization and population expansion

› Rising disposable income

› Falling copper prices

› Critical infrastructure replacement after damaging extreme weather events

› Expansion of renewable energy requiring significant amounts of wire and cable

› Strong end market demand: automotive, aerospace and medical

› Rise in demand for flexible, customized products that support intelligent manufacturing, monitoring and reporting

› Advances in cellular technology, including 5G, that require tremendous amounts of fiber optic cable

› Demand from automotive customers for smaller, lighter wire and cable systems to achieve efficiency for electric vehicles

Favorable Economic Conditions

Environmental Factors

New Technology and Automation

Segment Spotlight: Wire and Cable – Growing Demand

Global Wire andCable Industry

4.1% CAGR through 2026*

*Source: Transparency Market Research

www.ioadvisors.com

($ in millions) Enterprise EBITDA

Company Name Value (EV) Revenue $ % Revenue EBITDA

United States

Amphenol Corporation $ 30,583 $ 7,633 $ 1,801 23.6% 4.0x 17.0x

Encore Wire Corporation 914 1,222 96 7.9% 0.7x 9.5x

International Wire Group Holdings,

Inc.

369 571 49 8.5% 0.6x 7.6x

Houston Wire & Cable Company 215 324 11 3.3% 0.7x 20.3x

Group Mean 8,020$ 2,437$ 489$ 10.8% 1.5x 13.6x

Group Median 642$ 896$ 72$ 8.2% 0.7x 13.2x

Europe

Prysmian S.p.A. 6,863 9,848 676 6.9% 0.7x 10.1x

Nexans S.A. 2,117 7,521 436 5.8% 0.3x 4.9x

LEONI AG 2,260 6,195 421 6.8% 0.4x 5.4x

IRCE S.p.A. 149 443 23 5.2% 0.3x 6.5x

Group Mean 2,847$ 6,002$ 389$ 6.2% 0.4x 6.7x

Group Median 2,188$ 6,858$ 429$ 6.3% 0.4x 5.9x

Asia

Totoku Electric Co., Ltd. 160 172 27 15.9% 0.9x 5.9x

KB Metal Co., Ltd. 134 447 17 3.9% 0.3x 7.7x

Solartech International Holdings

Limited

315 51 29 56.9% 6.2x 10.9x

Asia Pacific Wire & Cable

Corporation Limited

90 443 13 2.9% 0.2x 7.1x

Precision Wires India Ltd. 75 217 13 6.2% 0.3x 5.6x

Group Mean 155$ 266$ 20$ 17.2% 1.6x 7.4x

Group Median 134$ 217$ 17$ 6.2% 0.3x 7.1x

LTM EV Multiples

7

Segment Spotlight: Wire and Cable – Financial Performance

Source: S&P Capital IQ as of 7/31/2018

▪ International Wire Group Holdings’ low EBITDA multiple reflects continued underperformance and loss of market share

▪ Prysmian’s steady stream of acquisitions and positive growth outlook have been rewarded with an attractive valuation multiple more akin to U.S. multiples

www.ioadvisors.com8

Segment Spotlight: Wire and Cable – Select Transaction

Headquarters: Highland Heights, KYWebsite: www.generalcable.comEmployees: 8,500Ownership: Public (NYSE:BGC)Revenue: $3.9 billion

Headquarters: Milan, ItalyWebsite: www.prysmiangroup.comEmployees: 21,285Ownership: Public (BIT:PRY)Revenue: $9.2 billion

Develops, designs, manufactures, markets, and distributes copper, aluminum,and fiber optic wire and cable products

› Offers electrical utility, electrical infrastructure, communication, andconstruction products

› Offers products to energy, industrial, construction, specialty, andcommunication markets

› Offers design, integration, and installation services for high voltageterrestrial and submarine products

› Sells directly to utilities, distributors, retailers, contractors, andmanufacturers in the Americas and in Europe

General Cable Business Description Transaction Details

› Prysmian acquired all the outstanding shares of General Cable commonstock for $30 per share in cash, a premium of 81% over the closing price of$16.55 per share on the day prior to General Cable announcing its reviewof strategic alternatives

› The terms of the transaction valued General Cable at about $3 billion,including debt and other liabilities, indicating a Total Enterprise Value-to-EBITDA multiple of about 25x, largely due to declining earnings

› After the transaction, which closed on June 6, 2018, General Cablebecame a privately held company and subsidiary of Prysmian

› Deal financed through new debt, cash and existing credit lines

Rationale

› Prysmian increased its presence in North America, Europe and SouthAmerica, providing more geographic exposure and reduced risk

› By combining highly complementary product portfolios, Prysmian is ableto extend and complete its product offering

› The integration of the two companies generates significant synergies inprocurement, cost reduction, manufacturing optimization, working capitalmanagement and financing cost reductionSource: S&P Capital IQ and company websites

General Cable Prysmian Group

www.ioadvisors.com9

About InterOcean Advisors LLC

Investment Bank for the Manufacturing SectorInterOcean Advisors LLC is one ofNorth America’s leading specialtyinvestment banks focused on themanufacturing sector. Through thissingular focus, InterOcean hasdeveloped deep industry expertisethat time and again provesinvaluable to our clients. Withextensive transaction experience inthe manufacturing sector, coupledwith the practical advice ofdedicated senior advisors withrelevant operating expertise, theInterOcean team can provideseasoned advice targeted to theElectrical Products industry and ourclients’ specific circumstances.

InterOcean advises private businessowners, corporations, private equitygroups, family offices andmanagement teams, offering thefollowing services:

Global CoverageInterOcean is the sole U.S. member of the Terra CorporateFinance Alliance, a growing international alliance of well-established investment banks with operations in NorthAmerica, South America, Europe, the Middle East, Africa andAsia. Through this network, InterOcean has a platform foroffering enhanced identification of, and access to, potentialtransaction parties around the globe.

▪ Mergers & Acquisitions▪ Private Capital Sourcing▪ Financial Advisory

www.terra-alliance.com

› Founded in 2002

› Consists of leading middle market M&A and corporate finance advisory firms

› 30+ offices across five continents

› An extremely effective network with a high degree of cooperation and a strong record of transaction success

› Associated firms have advised on more than 200 M&A transactions with a total value in excess of $10B

Selected as a finalist for the M&A Advisor’s 2015 M&A Deal of the Year in the category of Industrial Goods & Basic Resources

Named to the 2017 Axial 100 list for the most referred middle market M&A advisory firms