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AnsvarsfraskrivelseDen vedlagte ”Fairness Opinion – Placement of new ordinary shares by DONG Energy A/S” dateret den 2. de-cember 2013 (“Fairness
Opinion”)er udarbejdet af Danske Bank A/S (“Rådgiveren”) i forbindelse med entransaktion vedrørende udstedelse af nye, ordinære aktier eller udstedelse af nye egenkapitalbaserede værdipa-pirer til nye investorer i DONG Energy A/S (”Transaktionen”, som nærmere beskrevet i Fairness Opinion). Fair-ness Opinion fremlægges af Finansministeriet og ikke af Rådgiveren. Fairness Opinion er udelukkende udarbej-det til, og til brug for, Finansministeriet i forbindelse med Finansministeriets vurdering af Transaktionen, og Rådgi-veren påtager sig således intet ansvar over for, og der kan ikke støttes ret på Fairness Opinion af, andre endFinansministeriet.
Fairness Opinion må alene gøres tilgængelig i sin helhed.
Fairness Opinion udgør ikke en anbefaling om, hvorvidt Transaktionen bør gennemføres eller ej. Fairness Opini-on må ikke under nogen omstændigheder helt eller delvist offentliggøres i eller videregives til, og der må ikkestøttes ret på Fairness Opinion af, nogen person i Amerikas Forenede Stater, Canada, Australien eller Japan.
DisclaimerThe enclosed ”Fairness Opinion – Placement of new ordinary shares by DONG Energy A/S” dated 2 December2013 (the “Fairness
Opinion”)has been prepared by Danske Bank A/S (the “Advisor”) in connection with atransaction involving the placement of new ordinary shares or issue of new equity linked securities to new inves-tors by DONG Energy A/S (the “Transaction” as further described in the Fairness Opinion). The Fairness Opinionis being disclosed by the Ministry of Finance and not by the Advisor. The Fairness Opinion is solely prepared forthe information and benefit of the Ministry of Finance in connection with their assessment of the Transaction and,accordingly, the Advisor accepts no liability towards, and the Fairness Opinion may not be relied upon by, anyperson other than the Ministry of Finance.
The Fairness Opinion may only be made available in its entirety.
The Fairness Opinion does not constitute a recommendation as to whether or not to complete the Transaction.The Fairness Opinion may not under any circumstances in whole or in part be made public in or forwarded to anyperson, or relied upon, in the United States of America, Canada, Australia or Japan.
FinansministerietChristiansborg Slotsplads 11218 København K(the "Ministry of Finance")2 December 2013
For the attention of Peter Brixen
Dear Sirs and Madams,Fairness Opinion – Placement of new ordinary shares by DONG Energy A/SAccording to the Investment Agreement and Shareholders’ Agreement dated 29 November 2013, it has beenagreed that DONG Energy A/S (Business Registration No. CVR 36213728), a limited liability company incorpo-rated in Denmark with its registered address at Kraftværksvej 53, Skærbæk, 7000 Fredericia, Denmark, (“DONGEnergy”, the “Company”) is to complete a placement of new ordinary shares or issue new equity linked securitiesto new equity investors (the “New Investors”) with the intention to raise at least DKK 11 billion of new equity capi-tal in DONG Energy (the “Transaction”).
The Company together with its financial advisers, Morgan Stanley & Co. International plc and Nordea Bank Dan-mark A/S, initiated a competitive offering process (the “Process”) in March 2013 with the intention to complete theTransaction by targeting institutional and private equity investors based in Denmark and abroad. Following thisProcess, the New Investors have submitted an offer (the “Offer”) to subscribe for a minority equity stake in DONGEnergy.Pursuant to the Offer, and subject to the terms and conditions (the “Terms and Conditions”) set forth therein, theNew Investors shall, and the Company shall take such steps and do such further acts as are required to allow theNew Investors to, subscribe for new shares in the Company for the total nominal amount of at least DKK 11 billionat a valuation of 100% of the outstanding shares of DONG Energy prior to completion of the Transaction of DKK31.5 billion (the “Offer Price”).Danske Bank Corporate Finance (Department of Danske Bank A/S) (“Danske Bank”) has been retained as finan-cial adviser to the Ministry of Finance in connection with the Transaction. In your capacity as principal shareholderof the Company, you have asked Danske Bank to render an opinion in relation to the fairness of the Offer Pricefrom a financial point of view, prepared based on the method of opinion described below. Danske Bank will re-ceive a fee for rendering this opinion ("this "Fairness Opinion") and for other financial advisory services providedin connection with the Transaction.
Basis of opinionIn rendering this Fairness Opinion, we have only relied on the following information (the “Information”) receivedfrom DONG Energy:
Certain publicly available business and financial information relating to the Company, including but notlimited to the annual financial report of DONG Energy for the fiscal year 2012 and the interim financialreports covering the first nine months 2013
Certain information including the budgets and financial forecasts for DONG Energy as contained in the“DONG Energy HLM F4 2013 pacer” spreadsheet prepared by DONG Energy dated 12 August 2013 (asmodified by the F5 2013 forecast dated 15 October 2013 with respect to certain estimates for 2013)
Certain information contained in the “Investor Management Presentation” dated 16 April 2013, the “Ex-tended Management Presentation” dated 22 May 2013 and other presentation materials prepared byDONG Energy
Certain other information prepared by DONG Energy and their advisers which we have deemed relevantfor this Fairness Opinion, including (i) the Legal Summary Report prepared by Plesner and dated 11 July2013, (ii) the memorandum prepared under the title "Retsager og voldgiftssager" latest updated as at 4October 2013 and (iii) information relating to a dispute with SSR Renewables regarding certain mattersrelated to the Walney wind farm, and the financial vendor due-diligence report prepared by PwC anddated 28 June 2013
The Process Memorandum titled “Placement Process Considerations” dated 1 November 2013 preparedby DONG Energy’s financial advisers, Morgan Stanley & Co. International plc and Nordea Bank Dan-mark A/S
A written statement (the “Statement”) signed by the management board of the Company has confirmedto Danske Bank that to their knowledge after having made due inquiry, and in all material respects:
DONG Energy has made public all information about DONG Energy, which DONG Energy isobliged to make public in accordance with applicable laws and regulations, including but notlimited to the rules of relevant stock markets and the Danish Companies Act;
The annual report of DONG Energy for the accounting year 2012 and interim report for the firstnine months of 2013, is true and correct and gives a true and fair view of the Company’s finan-cial position and of the results of the operations and cash flows of the Company for the account-ing year 2012 and the first nine months of 2013;
DONG Energy has provided Danske Bank with all information required by us and such infor-mation was at the respective times such information was provided to us true and correct;
The “DONG Energy HLM F4 2013 pacer” spreadsheet prepared by DONG Energy dated 12August 2013 (as modified by your F5 2013 dated 15 October 2013 with respect to certain esti-mates for 2013) reflects DONG Energy’s most recent budgets and forecasts;
Except as disclosed in (i) the Legal Summary Report prepared by Plesner and dated 11 July2013, (ii) the memorandum prepared under the title "Retsager og voldgiftssager" latest updatedas at 4 October 2013 or (iii) a dispute with SSR Renewables regarding certain matters relatedto the Walney wind farm, no claim, lawsuit, legal or other similar proceeding is pending or to theCompany's knowledge threatened against the Company or its subsidiaries or their assets be-fore any court, arbitration tribunal, or administrative body which, if adversely decided, wouldhave a material adverse effect on the business, property, assets, operations or condition (finan-cial or otherwise) of DONG Energy.
The term sheet signed on 2 October 2013 by the Kingdom of Denmark and the New Investors in connec-tion with the Transaction.
The Investment Agreement and Shareholders’ Agreement dated 29 November 2013.
This Fairness Opinion has been prepared based on principles, which we, applying our best professional judge-ment, have deemed adequate and reasonable.
For the purposes of this Fairness Opinion we have primarily, but not only, based our valuation of DONG Energyon (i) a discounted cash flow analysis on a group, business-unit and asset level, (ii) multiples applied for compa-nies which we in each case have deemed comparable to either DONG Energy as a group or one or more of itsbusiness units and (iii) multiples applied in transactions which we in each case have deemed relevant and compa-rable to the Transaction.
For the purpose of this Fairness Opinion, we have in addition to the above also considered the Terms and Condi-tions from a financial perspective.
In rendering this Fairness Opinion, we have relied upon and assumed, without independent analysis or verifica-tion:
the accuracy and completeness of the Information, and we have assumed no responsibility for independ-ently verifying the accuracy and completeness of the Information or any part thereof,that DONG Energy has submitted to us any and all information which to the best of DONG Energy’sknowledge and believe has or might have an impact on our valuation of the Company or this Fairness
Opinion and that the information submitted to us gives a complete and accurate view of the financial posi-tion of the Company;that the valuation of DONG Energy’s assets and liabilities made by the management of DONG Energy asshown in the latest interim report relating to the period from 1 January to 30 September 2013 gives a trueand fair view of the Company’s financial position at the date of this Fairness Opinion and of the results ofthe operations and cash flows of the Company for the financial period 1 January to 30 September 2013;
that the budgets and forecasts for DONG Energy prepared by DONG Energy are true and correct, and thatthe financial forecasts have been estimated on a reasonable basis reflecting the best available informationand well-founded judgements and estimates of the senior management of DONG Energy, and that suchforecasts will be realised in the amounts and at the time contemplated thereby;
that no dividends or other leakages which have not been disclosed or provided for in the Information will bepaid or announced prior to the completion of the Transaction by DONG Energy;
that since the presentation of the most recent annual report of the Company, no events having any mate-rial adverse effect on the business, property, assets, operations or condition (financial or otherwise) to theCompany has occurred except as disclosed in the Information;
that any inability or conditions, as the case may be, to obtain regulatory approvals or third party consentsto complete the Transaction, if any, will not have any material adverse effect on the business, property,assets, operations or condition (financial or otherwise) of DONG Energy;
that the Ministry of Finance has received qualified legal advice regarding all relevant legal matters, and thatthe Ministry of Finance has, inter alia, taken such advice into account in its commercial assessments; and
that the Statement is true and correct.
This Fairness Opinion is subject to the following qualifications:
In the ordinary course of our business, Danske Bank may actively trade the debt securities of DONG Energy andderivatives hereof, for our own account, and for the accounts of customers, and accordingly, may at any time holda long or short position in such securities.
This Fairness Opinion is based on economic, market, regulatory and other conditions in effect on 2 December2013, and the information made available to us until that date. It should be pointed out that subsequent develop-ments may have an impact on the valuation of the Company, but we are not under an obligation to update, reviseor reconfirm this Fairness Opinion.
We have not verified the Information received or any other information, nor performed any kind of due-diligenceinvestigations.
We have not controlled the consistency of and completeness and accuracy of the Information and any other in-formation received or obtained.
This Fairness Opinion does not contain, neither directly nor indirectly, any position on the value of all or parts ofthe activities and/or shares of DONG Energy.
This Fairness Opinion contains subjective elements and reflects our best financial assessment.
We do not provide legal, technical, accounting or tax advice, nor are we actuaries and our services do not includeactuarial determinations or evaluations, nor did we make an attempt to evaluate any actuarial assumptions. Inaddition, we have not reviewed any individual credit files nor have we made any independent evaluation or ap-praisal of the assets and liabilities of DONG Energy or any of its subsidiaries, and we have not been furnishedwith any such evaluation or appraisal. In that regard, we express no opinion as to the adequacy of the provisionsof DONG Energy or any of its subsidiaries.
We have excluded from our analysis any consideration of the tax implications of the Transaction for DONG En-ergy and the shareholders of DONG Energy.
Governing law; Arbitration
Any dispute arising out of, or relating to, this Fairness Opinion shall be construed in accordance with and gov-erned by the laws of Denmark and shall be finally settled by arbitration in accordance with the rules of the DanishInstitute of Arbitration (Copenhagen Arbitration) by three arbitrators. The arbitration procedure shall take place inCopenhagen and shall be carried out in the English language, if so requested by a party.
Our advisory services and the opinion expressed herein are provided solely for the information and assistance ofthe Ministry of Finance in connection with its assessment of the Transaction and may not, without our prior writtenconsent, be relied upon by the Ministry of Finance for any other purpose or be or relied upon by any person otherthan the Ministry of Finance.
The Ministry of Finance is entitled to disclose this Fairness Opinion in its entirety under the condition that in thisregard, it is made clear in writing that (i) this Fairness Opinion is solely prepared for the information and benefit ofthe Ministry of Finance in connection with their assessment of the Transaction, and that (ii) this Fairness Opinionis disclosed by the Ministry of Finance (or on behalf of the Ministry of Finance) and not by Danske Bank.
This Fairness Opinion may not be summarised, quoted from or included in public documents or otherwise publiclyreferred to, or be used for any other purpose without the prior written consent of Danske Bank. However, subjectto prior written consent by Danske Bank, the Ministry of Finance may disclose this Fairness Opinion in its entiretyto (i) the Finance Committee of the Danish Parliament or (ii) the EU Commission in relation to their assessment ofthe Transaction’s compliance with State aid rules subject to the Ministry of Finance stating in a cover letterthereto, that this Fairness Opinion has been made solely for the internal use of the Ministry of Finance in connec-tion with their assessment of the Transaction.
This Fairness Opinion does not constitute a recommendation as to whether or not to complete the Transaction. Itmust not under any circumstances in whole or in part be made public in or forwarded to persons in or relied on inthe United States of America, Canada, Australia and Japan.
Based upon and subject to the content of this letter and based upon such other matters, as we consider
relevant, it is our opinion that at the date of rendering this Fairness Opinion, the Offer Price is fair for the
Ministry of Finance from a financial point of view
Yours faithfully,DANSKE BANKCorporate Finance
Jesper H. Jensen