2016 EXTRAORDINARY GENERAL SHAREHOLDERS MEETING Madrid, 15 September 2016 LARGER BROADER STRONGER
DISCLAIMER This presentation has been prepared by Certain statements in this document jurisdictions may also be restricted by law OF IT FORM THE BASIS OF OR BE RELIED MERLÍN Properties, SOCIMI, S.A. (the regarding the market and competitive and persons into whose possession this ON IN CONNECTION WITH ANY CONTRACT Company) for informational use only. position data may be based on the internal presentation comes should inform themselves OR COMMITMENT TO SELL OR PURCHASE analyses of the Company, which involve about and observe any such restrictions. In SHARES. ANY DECISION TO SELL OR The information contained in this presentation certain assumptions and estimates. 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2016 EXTRAORDINARY GENERAL SHAREHOLDERS MEETING Madrid, 15 September 2016 Agenda items Integration of Metrovacesa 2 ı 4 Transaction highlights Metrovacesa overview MERLIN post-transaction Board of directors 3 Distribution to shareholders 1 Timetable and conclusions
INTEGRATION OF METROVACESA Agenda items 2 ı 4 ı 4 ı
TRANSACTION HIGHLIGHTS ı 5 ı
Transaction highlights INTEGRATION OF METROVACESA: COMPELLING STRATEGIC RATIONALE • Consolidation of the #1 offjce portfolio Unparalleled footprint • Dramatic scale-up in shopping centers, becoming the #2 player in Spain Leadership • Undisputed Spanish leader and European • One of the largest diversifjed commercial REIT in Continental Europe scale • Company poised for compelling short-to-medium term value and FFO growth Tangible • Management to tighten overheads cap embedded upside • Management to adjust stock plan by reducing participation levels (1) • Leading Spanish rented residential platform, while deconsolidating from MERLIN Enhanced options for non- • Attractiveness and liquidity of the hotel division (#1 net lease hotel operator in Spain) core assets • NOL carry forwards (1 ) Subject to AGM approval ı 6 ı
Transaction highlights STRUCTURE & TERMS 1 2 3 4 1. Pre-transaction “status quo” 2. Full spin-off of MVC in 3 business lines Excluded from transaction scope Transaction MVC MVC MVC structure commercial commercial rented land real estate residential MERLIN MERLIN commercial rented real estate residential JV MVC Residential Contributed to: Shareholders Company ı 7 ı
Transaction highlights STRUCTURE & TERMS 1 2 3 4 3. Acquisition of MVC’s commercial property in exchange for 146.7 m MERLIN shares Shareholders structure MERLIN MVC Shareholders Shareholders 21.95% 68.76% Transaction structure Santander 6.41% BBVA 31.24% Popular 2.86% MVC’s minorities 0.02% Current MERLIN MERLIN MVC shareholders commercial commercial real estate real estate ı 8 ı
Transaction highlights STRUCTURE & TERMS 1 2 3 4 4. Simultaneous merger of MVC’s rented residential platform into MERLIN’s platform Shareholders structure MVC Shareholders 34.24% Transaction structure Service JV Santander Level Residential JV Residential BBVA Agreement 65.76% Company Company Popular MVC’s minorities 0.05% MERLIN 46.21% 6.01% MERLIN MVC rented rented 13.49% residential residential ı 9 ı
Transaction highlights STRUCTURE & TERMS 1 2 3 4 • 180-day initial lock-up for MVC shareholders Shares • Orderly sale mechanism disposal • 90 days lock-up for future sell-downs for blocks over 1% of TSO terms • MVC shareholders are restricted from “dribbing-out” over 20% the average daily volume • Enlargement of MERLIN BoD to refmect new shareholding structure: 15 members (60% independent) Governance • MERLIN management team to remain unchanged and • JV Residential Company: internally managed by the T esta Residencial management team under Management the supervision of MERLIN, through a Service Level Agreement (€7.7m annual fee) • Transaction subject to antitrust approval Approvals • Transaction subject to approval of MERLIN and MVC shareholders (15 September 2016) and timing • Expected closing: Q4 2016 • Reciprocal €75m break-up fee if transaction not approved by either EGM Other • MERLIN and MVC will distribute to shareholders €66m and €50m, respectively, before transaction closing ı 10 ı
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