industrial technology - harris williams

Industrial TechnologyIndustrial Automation Sector Update | Q4 2020

Harris Williams Industrial Technology Introduction

1

HARRIS WILLIAMS’ EFFORTS IN INDUSTRIAL TECHNOLOGYHARRIS WILLIAMS (“HW”)

• 25+ years and more than 1,000 closed transactions

• 350+ professionals across eight offices globally

• 170+ closed transactions in the last 24 months

• 10 industry groups

FOCUSED ADVISORY SERVICES

• Mergers and acquisitions (M&A)

• Capital raises

• Corporate divestitures

• Valuation

• Strategy and negotiation INDUSTRIAL TECHNOLOGY FOCUS SECTORS

CONSISTENT RECOGNITION FOR QUALITY

HARRIS WILLIAMS INDUSTRIAL TECHNOLOGY CONTACTS

AUTOMATION ENGINEERED COMPONENTS

TEST & MEASUREMENT

COMMUNICATION &CONNECTIVITY

INTRODUCTION & MARKET UPDATE

AUTOMATION OVERVIEW

SUBSECTOR DEEP DIVE HW CASE STUDIES

Giles TuckerManaging Director

[email protected]+1 804-335-4323

Chris ToussaintVice President


Jenson DunnVice President


Florian RippergerVice President


• Global team of senior professionals in Richmond, Boston, San Francisco, and Frankfurt

• Dedicated sector team as part of Harris Williams’ broader Industrials practice

• Focus on high technology / IP / engineering content that provides mission-critical value relative to broader systems

• Extensive execution experience and proven ability to understand complex technology-oriented companies

John ArendaleManaging Director


Eric LogueManaging Director


Jeff PerkinsManaging Director


mailto:[email protected]







Harris Williams Current Market Observations and Insights

Buyer Sentiment

• After an initial period of inward focus, many PEGs have transitioned from a defensive stance with their portfolios to an offensive posture on both add-on and platform acquisitions.

• Untouched cash pockets over the last six months increase the pressure to invest capital; however, investors remain highly focused on A-quality assets.

• Feedback suggests a continued up-tick in M&A activity for the remainder of 2020 and beyond, although implications of U.S. elections and potential tax law changes are beginning to factor into near-term decision-making.

Economic Outlook

• In recent weeks, there have been early signs of green shoots across multiple economic dimensions, including retail sales, industrial production, employment indices, and optimism for future business activity.

• While uncertainty remains around the shape and magnitude of the ultimate recovery amidst a resurgence of COVID-19 infections, many companies are recovering faster and to a greater extent than originally expected.

Debt Markets

• Increased activity since the trough in March with significant variation depending on the quality and industry of the asset.

• Groups that are trying to put money to work are finding that current deal flow is limited in both quantity and quality.

• Lender appetite heavily dependent on size of opportunity – credit market for assets with less than $25 million in EBITDA is significantly tighter than for platforms of $25+ million in EBITDA.

M&A Valuations

• Based on HW deals with valuation feedback since March, multiples have consistently remained elevated as transaction volume has started to approach pre-COVID levels, albeit that the notion exists that many of the deals are smaller or "B"-grade.

• Top-quality assets will continue to receive elevated levels of interest and competitive valuations, while, average businesses are more likely to see downward pressure on valuations.

CURRENT MARKET OBSERVATIONS

2

LATEST HARRIS WILLIAMS MARKET INSIGHTS

For access to Harris Williams’ latest insights and perspectives, email us at [email protected] or visit www.harriswilliams.com/news-insights.

DEEP SECTOR EXPERTISE AND EXECUTION EXCELLENCE

• Harris Williams has a proven ability to understand complex technology-oriented companies and position the nuances to deliver benchmark valuations.

• Extensive experience and valuable insights from our dedicated global teamprovide real-time market insights from hundreds of touch points across the world and the firm.

• Our professionals have a unique understanding of how to navigate and execute successfully amidst an unprecedented market environment.

INDUSTRIAL TECHNOLOGY CONTENT AND RESOURCES

Industrial Software Update Industry Conferences

Industrial Technology Update

Industrial Sensor Platforms

Smart City Opportunities Market and Sector Observations


AUTOMATION OVERVIEW

HW CASE STUDIESSUBSECTOR DEEP DIVE

https://www.harriswilliams.com/industry-update/industrial-software-sector-review-1q-2020

https://www.harriswilliams.com/article/30k-feet-key-takeaways-automate-and-promat-2019

https://www.harriswilliams.com/industry-update/industrial-technology-update-q1-2020

https://www.harriswilliams.com/article/sensing-opportunity-building-marquee-industrial-sensor-company

https://www.harriswilliams.com/article/smart-city-rapid-growth-diverse-opportunities

https://www.harriswilliams.com/article/industrial-technology-market-observations


https://www.harriswilliams.com/news-insights

Market Trends: Automation

3Sources: Fortune Business Insights, Research and Markets, Statista, Control System Integrators Association, HW Intelligence


AUTOMATION OVERVIEW


COVID-19 Impact

Eliminating Waste

Greater Labor Efficiencies and Increased Productivity

$675bn+

$729bn+

Reduced Time to Market

$810bn+

Increased Asset Utilization

$675bn+

Automation Benefits

VALUE PROPOSITION

EST. GLOBAL COMMERCIAL VALUE

Reduced Operating Costs

Improved Efficiency

Higher Quality

Increased Output

Industrial Automation Market

SHARE BY END-MARKET (2018)

CAGR: 8%(in $ bn)

31%

19%11%

9%

8%

22%

Discrete Manufacturing Other Hybrid & Process

Food & Beverage Chemicals

Machines Others

169 183 198 215 233 252 274297

2019 2020 2021 2022 2023 2024 2025 2026

▪ Automation is a critical success factor for production efficiency. Only excellent automation solutions make it possible to achieve consistently high quality, high throughput, and lowproduction costs, which allows customers to lead the market and remain highly competitive.

▪ While the initial automation and robotics revolution was started by the automotive industry, new industries such as medical, life sciences, food, consumer goods, and electronicsare increasingly utilizing automation systems. Since 2005, non-automotive industries have increased their relative share of total orders with evolving application technologiesdriving strong automation adoption. This trend is expected to continue.

▪ While Europe and North America contribute the highest share to the global automation market, Asia-Pacific is the largest growth driver globally and is expected to expand itsmarket share in the future. In terms of innovation, Europe, Japan, and China are the main drivers of innovation in automation and converging operational technology withinformation technology.

Short-Term Impact

• With social distancing and remote working guidelines (e.g., with virtual commissioning) businesses are now looking at automation solutions to help mitigate the pandemic risks to operations while increasing manufacturing flexibility and efficiency.

• While automation solutions are a focus of corporate executives during the pandemic, unclear return on investment measures and timing of implementations amid economic uncertainty are delaying deployments, creating a drag on near-term performance, particularly in automation-stalwart end markets that were contracting long before the onset of COVID (i.e., automotive, heavy industry).

Long-Term Impact

• The automation industry is expected to receive increased interest in, and application of, automation among various industries.

• Alongside automation solutions, an increased demand for digitalized processes such as virtual commissioning and remote maintenance is expected.

• Supply chains are expected to retain to a more local production, which, in most instances, will require the deployment of automation solutions.

ImpactImpact

INDUSTRIAL AUTOMATION MARKET GROWTH

Smart Technology is shaping Smart Factories and Intelligent Manufacturing

4

INDUSTRY TRENDS END-MARKETS TRENDS

New technology disrupts traditional manufacturing

▪ Manufacturers develop, test and design their products through digital simulation (digital twins), thereby drastically decreasing R&D cost.

▪ Intelligent autonomous devices are able to learn from their environment and make decisions independently.

▪ Computer modeling tools enable companies to design materials with desired properties.

Manufacturing technology

IT systems merge with operational technologies (OT)

▪ Data-centric IT systems are being integrated in existing OT monitoring systems to create smarter, more efficient operations.

▪ Industrial IoT is reshaping manufacturing.

▪ Collaborative robots (Cobots) have an increasing share in the workforce.

Convergence of IT & OT

Sources: 2019 Manufacturing Trends Report, International Federation of Robotics, Cisco Global Cloud Index, Industrial Ethernet Book

Manufacturers evolve toward more service-centric business models

▪ Manufacturers adopt a Product as a Service business model, where the product is delivered as a service or experience, while the customer does not take ownership of a physical product.

▪ Manufacturing itself evolves to a service where businesses leverage a shared manufacturing infrastructure.

Everything as a Service (XaaS)

Smarter manufacturing through intelligent connected systems

▪ Intelligent Systems such as Artificial Intelligence and Machine Learning deliver instant manufacturing intelligence by analyzing large amounts of data in a few seconds.

▪ AI and ML are powering intelligent, autonomous systems that can streamline processes at any stage of the value chain.

Intelligent Manufacturing

58

150

2018 2020

15

36

2016 2021

SALES OF CO-BOTSIOT CONNECTIONS(in billions) (in thousand units)CAGR:

60.1%CAGR: 24.5%

710

1214

15

2017 2018 2019 2020 2021

GLOBAL INTELLIGENT PROCESS AUTOMATION

CAGR ’17- ’21: 20.9%

(in $bn)

COST REDUCTION THROUGH XAAS

32%

44%

52%

67%

0-25%

26-50%

51-75%

76-100%

Share of company’s enterprise IT that is Xaas (vs. traditional IT)

GLOBAL INTELLIGENT MANUFACTURING MARKET

50 54 59 64 69 75

2017 2018 2019 2020 2021 2022

CAGR ’17- ’22: 9.5%

(in $bn)


AUTOMATION OVERVIEW


Industrial Automation: Value Chain

5


AUTOMATION OVERVIEW


The value chain in industrial automation covers components and module manufacturers to machine builders and integrators, supplying systems as well as turnkey solutions to various industries

Machine Builders & Integrators End-users

▪ Clamps

▪ Conveyors

▪ Drives / Controls

▪ End-of-Arm-Tools

▪ Ergonomic handling

▪ Linear guides

▪ Machine vision / Visual solutions

▪ Robotics

▪ Warehouse handling / logistics

Component & Module Manufacturers

▪ Machine builders build “standard” machines andmachine tools.

▪ These machines can be adjusted to the specificaction to be taken (within parameters).

▪ Examples: CNC machinery, injection moldingmachines, cutting machines, etc.

▪ Integrators build (often turnkey) machinery andproduction lines for a specific task or process.

▪ The design and engineering phase is one of themost crucial parts of the production process.

▪ Examples: Engine production, quality inspection,assembly of any kind, etc.

Standard machinery can be part of a fully integrated line

▪ Automotive

▪ Electronics

▪ Food & Beverage

▪ Packaging

▪ Pharma

▪ Plastics

Subsector Deep Dive

Direct relationship with end-users

Product equipment experience

Ability to integrate various

machinery providers

Automated production expertise

Full integration in software

systems (e.g. ERP)

Overall purchase cost

FlexibilityProject

management

Machine Builders

Integrators

Top 25 Market Participants

6Note: System integrators do not include integrators with focus on warehouse automationSources: Control Engineering – 2020 System Integrator Giants, HW Intelligence


AUTOMATION OVERVIEW


The global market for machine builders and system integrators is highly fragmented - the majority of the companies are located in Europe and the U.S.

Top 25 Machine Builders - Machining Top 25 System Integrators

129

130

138

146

150

161

171

220

228

234

268

285

294

305

421

435

450

450

600

657

770

916

1,082

1,100

1,400

Relevant System Integration Revenue Estimates 2018 / 2019 based on public information (in $m)

639

700

787

827

1,029

1,136

1,165

1,300

1,300

1,500

1,520

1,595

1,689

1,791

1,953

1,993

2,293

2,978

2,980

3,013

3,055

3,519

4,306

4,513

4,635

Relevant Machine Building Revenue Estimates 2018 / 2019 based on public information (in $m)

System Integrators – Landscape

7Notes: 1) System integrators do not include integrators with focus on warehouse automation

2) Grey box denotes subsidiary asset of corporate parent or private equity groupSources: Pitchbook, MergerMarket, S&P Capital IQ

SYSTEM INTEGRATORS


AUTOMATION OVERVIEW


To receive the latest market landscapes, please contact [email protected].

C

Machine Builder - Landscape

8Sources: Pitchbook, MergerMarket, S&P Capital IQ

MACHINING

METAL & PLASTIC FORMING SYSTEMS WELDING


AUTOMATION OVERVIEW



Machine Builder - Landscape

9

MATERIAL HANDLING / CONVEYING / TRANSFERRING / FEEDING SYSTEMS TESTING / INSPECTION SOLAR

Sources: Pitchbook, MergerMarket, S&P Capital IQ

FINISHING / MARKINGPACKAGING FOOD PROCESSING


AUTOMATION OVERVIEW



Increasing M&A Momentum Across Machine Builders and Integrators

SELECT NOTABLE MACHINE BUILDERs AND SYSTEM INTEGRATORS M&A ACTIVITY

10Note: Logos are representative of M&A participants and not comprehensiveSources: Pitchbook, Mergermarket, S&P Capital IQ


AUTOMATION OVERVIEW


Capvis AG

ABB

2016 2018 2020201920172015

Burke E. Porter Machinery Company

Shanghai Electric Group

L-3 CommunicationsHoldings, Inc.

Tesla Motors

GROB-WERKE GmbH & Co. KG

Thomas H Lee PartnersFalfurrias

Capital Partners

EQT

JR Automation

Burke Porter Group

Quadriga Capital; Intermediate Capital Group

Quadriga Capital; Intermediate Capital Group

Hitachi

Guangzhou HaozhiIndustrial

SPIE

BBS Automation

BBS Winding ist target

TDJ S.A.

Crestview Partners

Capvis AG

M.A.X. Automation Holding

Mahr

KION Group AG

Tyrol Equity AG

HQ Equita GmbH

Sealed Air Corporation

HAP

Beckhoff Automation

Konecranes

Deutsche Beteiligungs AG

Capvis AG

Toyota Industries Corp.

Chutian Asset Management (Changsha) Co., Ltd.

Blackstone Group

Franz Haniel & Cie GmbH

Hennecke GmbH & Co. KG

CGS Management AG

Maag Group

Stadler Formenbau

PlastechHolding

Winkler+Dunnebier

Michael Mettler

HQ Equita

Jenoptik

Marel Food Systems

Schubert Maschinen- &Anlagenbau

AUCTUSCapital

Partners

Keba

Equistone Partners Europe Limited

Finexx

Abbott Laboratories

CVC Capital Partners Limited

China Renaissance Capital &

Nanjing Dingpai

MCH PrivateEquity

Persico SpA

Komori Corporation

The Middleby Corporation

EoL PackagingExperts GmbH

TrukingTechnology

Limited

Nihon Spindle Manufacturing

Co Ltd

CGSManagement

AG

Gampack Srl

Astraco S.r.l.

Amutec S.r.l.

JR Automation

Dover

JR Automation

Quadriga Capital

Capvis

Honeywell

Kion Group AG

Jenoptik

BBS Automation GmbH


AUTOMATION OVERVIEW

HW CASE STUDIES

Automation Public Market Observations1

11

SUBSECTOR DEEP DIVE

AUTOMATION COMPANIES PUBLIC COMPARABLE MARKET PERFORMANCE

Indexed Close Price from September 19, 2017 (Index = 100 on September 19, 2017)

AUTOMATION COMPANIES PEER GROUP

ANALYSIS SUMMARY

60

80

100

120

140

Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 Mar-20 Sep-20

Automation MSCI Index - Industrials

120.0

112.3

68.4

75.2

95.1

102.4

110.1104.3

Automation MSCI Index -Industrials

3-yr Max 3-yr Min3-yr Median Current Median

1) As of September 22, 2020Source: S&P Capital IQ

Automation Companies Market Valuations1

12


AUTOMATION OVERVIEW

HW CASE STUDIES

N/A: Not Available, NM: Not Meaningful

SUBSECTOR DEEP DIVE

1) As of September 22, 2020Source: S&P Capital IQ

Market Current Percent of Enterprise Revenue EBITDA Margin EV / Revenue EV / EBITDA

Company Capitalization Stock Price 52-wk High Value CY2019A CY2020E CY2019A CY2020E CY2019A CY2020E CY2021E CY2019A CY2020E CY2021E

Automation and Robotics

ABB Ltd $53,375 $25.10 93.2% $63,253 $27,978 $25,196 12.6% 11.4% 2.3x 2.5x 2.4x 18.0x 22.0x 16.3x

ATS Automation Tooling Systems Inc. $1,208 $13.02 75.1% $1,403 $1,067 $1,000 12.2% 12.0% 1.3x 1.4x 1.4x 10.8x 11.7x 9.5x

Dürr Aktiengesellschaft $2,012 $29.56 76.6% $1,977 $4,401 $3,870 7.1% 4.9% 0.4x 0.5x 0.5x 6.3x 10.4x 5.9x

GEA Group Aktiengesellschaft $6,191 $34.68 87.7% $6,059 $5,476 $5,486 4.4% 10.6% 1.1x 1.1x 1.1x 25.4x 10.4x 9.4x

Fanuc Corporation $37,651 $0.00 0.0% $32,956 $4,839 $4,426 26.9% 25.7% 6.8x 7.4x 6.1x 25.3x 29.0x 21.9x

Kawasaki Heavy Industries, Ltd. $2,436 $0.00 0.0% $6,775 $15,050 $14,356 7.3% 4.9% 0.5x 0.5x 0.5x 6.2x 9.6x 8.4x

Krones AG $1,939 $61.12 69.0% $2,065 $4,513 $3,844 5.6% 6.0% 0.5x 0.5x 0.5x 8.2x 8.9x 6.3x

KUKA Aktiengesellschaft $1,727 $43.33 84.9% $2,246 $3,583 $3,405 3.9% 2.2% 0.6x 0.7x 0.7x 15.9x 30.6x 15.3x

Nachi-Fujikoshi Corp. $866 $0.00 0.0% $1,589 $2,274 $1,859 12.1% 10.9% 0.7x 0.9x 0.8x 5.8x 7.8x 6.1x

Scott Technology Limited $96 $1.22 72.0% $120 $141 $121 4.6% 2.5% 0.8x 1.0x N/A 18.4x NM N/A

YASKAWA Electric Corporation $9,948 $0.00 0.0% $10,289 $3,864 $3,676 9.8% 0.0% 2.7x 2.8x 2.6x 27.3x N/A 20.9x

Median $2,012 $13.02 72.0% $2,246 $4,401 $3,844 7.3% 6.0% 0.8x 1.0x 0.9x 15.9x 10.4x 9.5x

Average $10,677 $18.91 50.8% $11,703 $6,653 $6,113 9.7% 8.3% 1.6x 1.8x 1.6x 15.2x 15.6x 12.0x

Automation Components

AirTAC International Group $4,359 $22.38 90.4% $4,697 $531 $617 33.5% 38.2% 8.8x 7.6x 6.4x 26.4x 19.9x 16.7x

Altra Industrial Motion Corp. $2,426 $38.09 88.2% $3,802 $1,834 $1,625 20.0% 19.9% 2.1x 2.3x 2.2x 10.4x 11.8x 10.6x

AMETEK, Inc. $22,100 $97.24 93.5% $24,008 $5,159 $4,499 26.7% 28.5% 4.7x 5.3x 4.9x 17.4x 18.7x 16.8x

CKD Corporation $1,046 $0.00 0.0% $1,005 $913 $957 10.4% 10.5% 1.1x 1.1x 1.0x 10.6x 10.0x 7.1x

Cognex Corporation $10,599 $62.16 86.6% $10,199 $726 $731 23.1% 23.5% 14.1x 13.9x 12.1x 60.9x 59.5x 41.9x

Dover Corporation $15,470 $107.56 89.4% $18,326 $7,136 $6,488 18.6% 18.5% 2.6x 2.8x 2.7x 13.8x 15.3x 13.7x

Keyence Corporation $107,900 $0.00 0.0% $98,248 $5,096 $4,862 52.2% 55.1% 19.3x 20.2x 17.7x 36.9x 36.7x 32.6x

Hiwin Technologies Corp. $3,188 $9.65 81.6% $3,767 $676 $718 21.8% 22.6% 5.6x 5.2x 4.3x 25.5x 23.2x 15.6x

IMI plc $3,530 $13.12 84.5% $4,063 $2,481 $2,266 18.0% 18.8% 1.6x 1.8x 1.8x 9.1x 9.5x 9.2x

Nidec Corporation $52,980 $0.00 0.0% $57,195 $13,919 $13,959 11.5% 14.9% 4.1x 4.1x 3.5x 35.6x 27.4x 22.4x

Parker-Hannifin Corporation $25,582 $200.63 92.2% $33,442 $14,201 $12,880 17.8% 18.2% 2.4x 2.6x 2.5x 13.2x 14.2x 12.9x

Rexnord Corporation $3,480 $29.30 82.2% $4,427 $2,059 $1,914 20.8% 22.4% 2.2x 2.3x 2.2x 10.3x 10.3x 9.7x

Rockwell Automation, Inc. $24,246 $214.09 89.8% $26,392 $6,737 $6,245 21.6% 20.1% 3.9x 4.2x 3.9x 18.1x 21.0x 18.5x

Sensata Technologies Holding plc $6,551 $41.88 76.5% $8,964 $3,451 $2,875 24.9% 20.9% 2.6x 3.1x 2.7x 10.4x 14.9x 11.3x

SMC Corporation $37,015 $0.00 0.0% $31,550 $4,865 $4,875 31.5% 30.5% 6.5x 6.5x 5.6x 20.6x 21.2x 17.8x

Schneider Electric S.E. $63,482 $119.09 93.5% $72,041 $30,477 $28,570 17.9% 16.8% 2.4x 2.5x 2.3x 13.2x 15.0x 12.7x

Siemens Aktiengesellschaft $104,572 $132.34 93.5% $147,409 $97,688 $72,681 11.4% 13.1% 1.5x 2.0x 2.1x 13.2x 15.5x 13.5x

Median $15,470 $38.09 86.6% $18,326 $4,865 $4,499 20.8% 20.1% 2.6x 3.1x 2.7x 13.8x 15.5x 13.7x

Average $28,737 $63.97 67.2% $32,326 $11,644 $9,810 22.5% 23.1% 5.0x 5.2x 4.6x 20.3x 20.3x 16.7x

Description

▪ ttPT is the industry leader in CEE for “state-of-the-art” assembly and test systems offering a one-stopsolution from design to after sales services.

▪ Future-oriented focus with almost 90% ofrevenues for solutions that are used in nextgeneration vehicles (e-mobility, autonomousdriving, etc.).

Process Highlights

▪ Harris Williams contacted a broad group of investorsfrom Europe, the USA, and Asia.

▪ Offers were received from both financial andstrategic parties.

▪ One party was particularly eager to acquire thecompany from early on. Competitive tension washeld until Signing with a favorable outcome for all selling parties.

has been acquired by

(Poland)

Select HW Integrated Assembly Solutions Case Studies

13


AUTOMATION OVERVIEW



Description

▪ Develops and manufactures production lines fordiscrete industrial automation and marketsworldwide.

▪ Clear innovation leader, developing new solutionsfor future-oriented end-markets, enablingcustomers to efficiently manufacture their state-of-the-art products.

Process Highlights

▪ Harris Williams was mandated to evaluate strategic options for the company following strong growth ofthe business.

▪ Harris Williams managed the negotiations withTesla, resulting in a purchase price ~18% over theinitial offer.

a portfolio company of


Description

▪ Leading intelligent automation integratorproviding its customers with highly engineeredsystems that lower customer production costs,accelerate new product development, improvequality control, and enhance product safety.

▪ One of the largest custom integrators of factoryautomation solutions in North America.

Process Highlights

▪ Harris Williams contacted a broad group of buyerswith a focused message on the automation segment.

▪ Received IOIs from both financial sponsors andstrategic buyers, but ultimately the client elected toproceed with a select group of sponsors.

▪ Continued competitive tension through final bidsyielded a successful outcome.

Harris Williams Capabilities and Locations

14

HARRIS WILLIAMS GLOBAL OFFICE LOCATIONS

Harris Williams is an investment bank specializing in M&A advisory services. Our firm advises and advocates for clients worldwide through critical milestones and during the lives of their businesses to strategically create value – with passion, flexibility and a commitment to detail. We collaborate as one firm across Industry Groups and geographic boundaries in a culture where every person is focused on our clients’ objectives. We are dedicated to execution excellence based on rigorous strategy that is specifically tailored to achieve success for our clients. As trusted thought partners to owners, management teams and buyers, we forge enduring, valued relationships that deliver results. For more information, visit our website at www.harriswilliams.com.

Aerospace, Defense & Government Services

Building Products & Materials

Business Services ConsumerEnergy, Power &

Infrastructure

Healthcare & Life Sciences

Industrials Specialty DistributionTechnology, Media &

TelecomTransportation &

Logistics

UNITED STATES EUROPE

BostonOne International PlaceSuite 2620Boston, Massachusetts 02110Phone: +1 (617) 482-7501

Cleveland1900 East 9th Street20th FloorCleveland, Ohio 44114Phone: +1 (216) 689-2400

San Francisco575 Market Street31st FloorSan Francisco, California 94105Phone: +1 (415) 288-4260

Washington, D.C. 800 17th St. NW2nd FloorWashington, D.C. 20006Phone: +1 (202) 207-2300

FrankfurtBockenheimer Landstrasse 33-3560325 FrankfurtGermanyPhone: +49 069 3650638 00

London25 Savile Row4th FloorLondon W1S 2ER, EnglandPhone: +44 (0) 20 7518 8900

Minneapolis222 South 9th StreetSuite 3350Minneapolis, Minnesota 55402Phone: +1 (612) 359-2700

Richmond (Headquarters)1001 Haxall Point9th FloorRichmond, Virginia 23219Phone: +1 (804) 648-0072

http://www.harriswilliams.com/

Disclosures

Investment banking services are provided by Harris Williams LLC (“Harris Williams”). Harris Williams is a registered broker-dealer and member of FINRA and SIPC. Harris Williams & Co. Ltd is a private limitedcompany incorporated under English law with its registered office at 8th Floor, 20 Farringdon Street, London EC4A 4AB, UK, registered with the Registrar of Companies for England and Wales (registrationnumber 07078852). Harris Williams & Co. Ltd is authorized and regulated by the Financial Conduct Authority. Harris Williams & Co. Corporate Finance Advisors GmbH is registered in the commercial register ofthe local court of Frankfurt am Main, Germany, under HRB 107540. The registered address is Bockenheimer Landstrasse 33-35, 60325 Frankfurt am Main, Germany (email address:[email protected]). Geschäftsführer/Directors: Jeffery H. Perkins, Paul Poggi. (VAT No. DE321666994). Harris Williams is a trade name under which Harris Williams LLC, Harris Williams & Co. Ltdand Harris Williams & Co. Corporate Finance Advisors GmbH conduct business.

The information and views contained in this presentation have been prepared in part by Harris Williams. This presentation does not purport to be comprehensive or to contain all the information that a recipientmay need in order to evaluate any investment or potential transaction. This presentation is not a research report, as such term is defined by applicable law and regulations, and is provided for informationalpurposes only. Any and all information, including estimates, projections and other forward-looking statements, presented in this document may involve various assumptions and significant elements ofsubjective judgment and analysis which may or may not be correct. Harris Williams has not independently verified, and neither Harris Williams nor any other person will independently verify, any of theinformation, estimates, projections or forward-looking statements contained herein or the assumptions on which they are based. The information contained in this document is made as of the date hereofunless stated otherwise. Harris Williams does not expect to update or otherwise revise this document nor provide any additional information, nor correct any inaccuracies herein which may become apparent.

This content is for institutional use only and should not be relied upon by retail investors or members of the general public. The information contained herein is believed by Harris Williams to be reliable butHarris Williams makes no representation or warranty as to the accuracy or completeness of such information, and information contained herein that is based on material prepared by others may involvesignificant elements of subjective judgment and analysis which may or may not be correct. Opinions, estimates and projections contained herein constitute Harris Williams’ judgment and are subject to changewithout notice.

This presentation is not to be construed as investment advice or an offer to buy or sell or a solicitation of an offer to buy or sell any financial instruments or to participate in any particular transaction, nor shallthis presentation form the basis of any contract. It does not constitute and should not be construed as an endorsement or recommendation of any entities’ products or services.

No part of this material may be copied or duplicated in any form or by any means, or redistributed, without Harris Williams’ prior written consent.

15

industrial technology - harris williams

Documents