Gerflor: AXA Private Equity acquires majority shareholding Paris, 19 October 2006.

AXA Private Equity, in association with Gerflor’s management team headed by its CEO, Bertrand Chammas, signed a share purchase agreement with PAI partners, Natexis Industrie, CDC Entreprises and Intermediate Capital Group (ICG), to acquire Gerflor group for approximately €310 million. For the purpose of this transaction, AXA Private Equity associated Barclays Private Equity, while Natexis Industrie and ICG will also co-invest and renew their confidence in Gerflor.

Gerflor, headquartered in Villeurbanne (69), is specialised in the manufacture and distribution of vinyl (PVC) flooring for professional as well as residential applications. The group employs more than 1900 people around the world and operates 7 production facilities located in France (Tarare, St Paul Trois Châteaux and Grillon), in Ireland (Carrickmacross), in Germany (Troisdorf), in China (Changshu – starting end of 2006) and in Thailand. In 2005, the company achieved a turnover of €336 million and is expecting more than €350 million of revenues in 2006.

Gerflor sells most of its products to professionals through its divisions in Contract (healthcare, education, housing, industry, etc.), Transport (bus/cars, aircrafts, trains) and Sport (tennis, handball, badminton, volley-ball, multi-sport centres, etc.) and also to private individuals for residential uses. It enjoys leadership positions in most of its markets.

Gerflor’s strengths mainly stem from its dedicated sales force (more than 300 people), its marketing strategy (prescription, dedicated per division and distribution network), its highly-recognised brands and innovation capacity (Taraflex®, Mipolam®, Texline®, HQR®, etc.) as well as its strong relationships with the key players of the industry. In addition, the markets, in which the group operates, require high levels of homologations, certificates as well as major industrial investments, and Gerflor benefits from a long-lasting experience in these fields.

Following this acquisition, AXA Private Equity will be the majority shareholder of Gerflor group. Barclays Private Equity, as well as Natexis Industrie and ICG, the two latter of which are willing to renew their confidence in the group, will co-invest alongside AXA Private Equity. In this context, the change in the majority shareholding has no impact for the group’s organisation and its employees and has been implemented to continue the development strategy put in place over the past few years.

“We are convinced that AXA Private Equity is the right partner to bring us the financial support in the coming years for our international development, our investment plan and the reinforcement of our commercial and marketing resources. Its recognised expertise in the construction and distribution markets, its active support in the development of its portfolio companies, the well-known AXA name and the access to its worldwide network, are trumps for the support of our growth projects, both organically and externally through strategic acquisitions”, stated Bertrand Chammas, CEO of Gerflor.

At AXA Private Equity, Dominique Gaillard, Member of the Executive Committee, and Eric Neuplanche, Director, underline: “we are very happy to partner with Gerflor group to enter a new period of its history. We have been impressed by the management and its strategic vision, and we intend to support them in order to double the size of the group in the coming years. Gerflor enjoys positive organic growth prospects thanks to the natural growth of its underlying markets, the penetration of new markets and the acceleration of the development in fast-growing areas (Russia, Eastern Europe, China and Latin America). In addition, we have proved in the past our ability to complete strategic build-up transactions for our portfolio companies and we intend to implement the same strategy with Gerflor as we think it can be a key player in the current industry consolidation”.

Gonzague de Blignières, Co-head of Barclays Private Equity, Caroline Joubin, Member of the Executive Committee of Natexis Industrie, and François de Mitry, Managing Director at ICG stated: “we are pleased to support Bertrand Chammas and his team in this project, alongside AXA Private Equity which we know very well”.

BNP Paribas has been appointed as Global Mandated Lead Arranger of the financing and Sole Bookrunner, with ICG acting as Mandated Lead Arranger on the Mezzanine piece.

The acquisition is subject to approval by the European anti-trust authorities.

List of people and advisors involved in the Gerflor transaction

Purchaser:

AXA Private Equity: Dominique Gaillard, Eric Neuplanche, Thibault Basquin

Advisors to AXA Private Equity:

M&A: Calyon (François Vigne, Christine Marchal, Fabien Brunet)

Legal advisor: Linklaters

1. Corporate: Michel Frieh, Fabrice de la Morandière, David Swinburne, Marine Delaître, Michael Piccioloni
2. Financing: Nathalie Hobbs, Adrien Paturaud
3. Tax structuring: Edouard Chapellier, Bérengère Giaccardo
4. Competition: Anne Wachsmann, Jean-Nicolas Maillard, Aliette Carré

Due-diligences:

1. Financial: PwC Transaction Services (Hervé Mader, Alain Calmé, Philip Dykstra)
2. Environment: ERM (Julien Famy, Julien Dulieu)

Co-investors:

• Natexis Industrie: Caroline Joubin, Sébastien Frédéric Ferrand
• Barclays Private Equity: Gonzague de Blignières, Laurent Chauvois
• ICG: François de Mitry, Hadj Djemaï

Sellers:

• PAI partners: Olivier de Vrégille
• Natexis Industrie: Caroline Joubin
• CDC Entreprises: Olivier Boyadjian
• ICG: François de Mitry, Hadj Djemaï

Sellers’ advisors:

• M&A: Rothschild & Cie (Laurent Baril, Ludovic Tron)
• Legal: Weil Gotshal & Manges (David Aknin, Andras Haragovitch, Yannick Olivier)
• Market vendor due-diligence: Bain & Cie (Stéphane Baleston)
• Financial vendor due-diligence: E&Y Transaction Services (Daniel Benquis, Lionnel Gerard)
• Tax vendor due-diligence: Ernst & Young Société d’Avocats (Lionel Nentille)
• Environmental vendor due-diligence: URS (Bertrand Latrobe)

Senior and Mezzanine financings:

• BNP Paribas: Boguslaw Matusiak, Pascal Borello, Pierre-Emmanuel Weil
• ICG: François de Mitry, Hadj Djemaï, Mattéo Perale, Mathieu Pinson

Legal advisor to BNP Paribas and ICG: White & Case (Henri-Joseph Tremolet de Villers, Gilles Peigney)

Management:

• Management financial advisor: Callisto (Hervé Couffin, Sébastien Blot)
• Management legal advisor: Sarrau Thomas Couderc (Hervé-Antoine Couderc, Jean-Bernard Thomas)

Press contact:

(33) 144 45 92 20

AXA Private Equity
20, place Vendôme
75001 PARIS