Prospectus Summary · 5 Publication of the extract of the prospectus in a legal gazette 08/03/2018 6 Opening of the duration of the Takeover Bid 14/03/2018 7 Closing of the duration

Prospectus Summary

MED PAPER Public Limited Company with a Board of Directors

Share Capital: MAD 258,255,500

Mandatory Takeover Bid on MED PAPER shares

not held by the Members of the concerted action

Initiated by the Members of the concerted action, represented by Mr. Mohsine Sefrioui

Characteristics of the Offer

Number of shares concerned 1,081,141 shares

Price per share MAD 22

Maximum amount of the Offer MAD 23,785,102

Offer duration From 14th March to 27th March 2018 inclusive

Financial Advisor and Global Coordinator Body in charge of the Operation Registration

APPROVAL OF THE MOROCCAN CAPITAL MARKET AUTHORITY (AMMC)

In accordance with the provisions of the circular of the Moroccan Capital Market Authority (AMMC), pursuant to Article 14 of the Dahir providing Law no. 1-93-212 of 21st September 1993 as amended and supplemented, and Article 36 of Law no. 26-03 relating to public offerings on the stock market as amended and supplemented by Law no. 46-06, the original copy of this prospectus was approved by the AMMC on the 6th of March 2018, under reference no. VI/EM/003/2018.

Mandatory Takeover Bid on MED PAPER shares Prospectus Summary

2

DISCLAIMER

The Moroccan Capital Market Authority (AMMC) approved on the 6th of March 2018 a prospectus

relating to the Mandatory Tender Offer for MED PAPER shares, initiated by the Members of the

concerted action, represented by Mr. Mohsine Sefrioui.

The prospectus approved by AMMC is available at all times at MED PAER’s headquarters and at its

financial advisor’s office.

The prospectus is available to the public at the Casablanca Stock Exchange headquarters and on its

website www.casablanca-bourse.com. It is also available on AMMC’s website www.ammc.ma.

http://www.casablanca-bourse.com/

http://www.ammc.ma/


3

PRESENTATION OF THE OPERATION


4

Objectives of the Operation

I.1. Reasons for the Operation

Pursuant to the applicable legal and regulatory provisions, the Offer is intended for the acquisition of the

MED PAPER shares not held by all the Members of the concerted action.

I.2. Intentions of the Initiators

On the eve of this Offer, the Initiators directly and indirectly hold 58.14% of the Company's share capital

and voting rights. Hence, the proposed Operation should not make any changes to MED PAPER's

strategy.

The Initiators, represented by Mr. Mohsine Sefrioui, do not intend to continue their purchases on the

MED PAPER value in the twelve months following the Offer, with the exception of the shares tendered

as part of the Offer by MED PAPER shareholders.

Based on the number of shares tendered to the Offer by MED PAPER shareholders, the percentage of

MED PAPER capital and voting rights - which will be controlled by Mr. Mohsine Sefrioui as

representative of the Initiators at the completion of the Offer - will be between 19.11% and 60.97%.

Thus, depending on the number of shares tendered to the Offer by MED PAPER shareholders, the

percentage of MED PAPER share capital and voting rights that will be held by all the Initiators at the

completion of the Offer will be between 58.14% and 100%.

It should be noted that Mr. Mohsine Sefrioui, representative of the Members of the concerted action, shall

acquire all the shares tendered to the Mandatory Tender Offer.

Furthermore, in accordance with the provisions of article 10 of the Law 26-03 relating to public offers on

the stock market, the Members of the concerted action are jointly and severally bound to the obligations

that are made to them under the said Law.

I.3. Financing Arrangements

As representative of the Initiators, Mr. Mohsine Sefrioui asserts having the necessary financial means for

the completion of this Offer and the payment of the related costs.

I.4. Evolution of the shareholder structure of MED PAPER

The table below presents the shareholder structure of MED PAPER before and after the Offer in the

event that all the shares covered by the Offer are contributed:

Shareholders

Before the Operation (31/12/2017) After the Operation

Nb. of shares Capital % Voting

rights % Nb. of shares Capital %

Voting rights %

Aliken 814 037 31.52% 31.52% 814 037 31.52% 31.52%

Mohsine Sefrioui 493 469 19.11% 19.11% 1 574 610 60.97% 60.97%

Habiba Bennani 114 049 4.42% 4.42% 114 049 4.42% 4.42%

Med Fouad Sefrioui 52 992 2.05% 2.05% 52 992 2.05% 2.05%

Ilham Sefrioui 26 867 1.04% 1.04% 26 867 1.04% 1.04%

Controlling interest 1 501 414 58.14% 58.14% 2 582 555 100.00% 100.00%

Various shareholders 1 081 141 41.86% 41.86% - - -

Total 2 582 555 100.00% 100.00% 2 582 555 100.00% 100.00%

Source: MED PAPER


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Structure of the Offer

II.1. Number of the concerned shares

The Offer will concern all the shares not held by all the Members of the concerted action at the date of

this offer prospectus, i.e. 1,081,141 shares representing 41.86% of MED PAPER's share capital and

voting rights.

II.2. Price of the Offer

The Initiators offer the other MED PAPER shareholders who are not part of the Members of the

concerted action the opportunity to sell their shares at MAD 22 per share.

II.3. Amount of the Offer

The Offer will cover 1,081,141 shares at MAD 22 per share, i.e. for a total maximum of MAD 23,785,102

excluding charges.

II.4. Opening date of the Offer

The Offer will begin on 14th March 2018.

II.5. Closing date of the Offer

The Offer will be closed on 27th March 2018 inclusive.

II.6. Offer duration

The Offer duration is between the opening date and the closing date of the Offer, i.e.10 trading days.

II.7. Waiver threshold

Due to the mandatory nature of the Offer, no waiver threshold is envisaged by the Initiators. Mr. Mohsine

Sefrioui, as representative of the Initiators, undertakes to firmly and irrevocably acquire all the shares

contributed by the shareholders affected by this operation.

II.8. Date of settlement

The settlement date is scheduled for 10th April 2018.

II.9. Acquisition of shares outside the Offer

The Initiators have not acquired, and do not intend to acquire, MED PAPER shares outside the Offer.

II.10. Links between MED PAPER and the Initiators

At the date of this prospectus, Mr. Mohsine Sefrioui as representative of the Initiators holds 19.11% of

MED PAPER capital and voting rights. The Members of the concerted action thus hold a total of 58.14%

of MED PAPER capital and voting rights.

Summary of valuation

Given the different valuation methods, the price used by the Initiators of the Takeover Bid amounts to

MAD 22 per MED PAPER share.

The table below presents the share value resulting from each of the methods selected for the valuation of

the MED PAPER share.


6

Valuation method used Value per share

(in MAD) Method weighting

Offered Premium / discount

Stock prices approach 28.04 1/3 -22.0%

Reference transactions method 28.64 1/3 -23.0%

Discounted Cash Flows method 0 1/3 n.s.

Average 18.9 - 16.00%

Source: BMCE Capital Conseil


7

Schedule of the Offer

Order Steps No later than

1 Receipt by the Casablanca Stock Exchange of the complete file of the operation 05/03/2018

2 Issuance by the Casablanca Stock Exchange of the Notice of Approval of the operation 06/03/2018

3 Receipt by the Casablanca Stock Exchange of the AMMC-approved prospectus 06/03/2018

4 Publication of the excerpt of the prospectus in the Official List (Bulletin de la Cote) 07/03/2018

5 Publication of the extract of the prospectus in a legal gazette 08/03/2018

6 Opening of the duration of the Takeover Bid 14/03/2018

7 Closing of the duration of the Takeover Bid 27/03/2018

8 Receipt by the Casablanca Stock Exchange of the files relating to the orders on securities contributed, before 12:00 a.m.

28/03/2018

9 Centralization and consolidation of the orders on securities contributed by the Casablanca Stock Exchange

29/03/2018

10 Sending to AMMC of a summary statement of orders on securities contributed 30/03/2018

11 Receipt of AMMC's response on the Takeover Bid (approval or not) and publication of the announcement in the Official List by the Casablanca Stock Exchange, in case AMMC rejects the Operation

02/04/2018

12 Presentation by the Casablanca Stock Exchange of the results of the Takeover Bid to the order collectors

03/04/2018

13 Registration of the Offer on the stock exchange and announcement of its results in the Official List

05/04/2018

14 Payment / Delivery Publication of the results of the Operation by the representative of the Initiators in a legal gazette

10/04/2018


8

PRESENTATION OF THE INITIATORS


9

General presentation of the representative of the Members of the concerted action

Chairman and Chief Executive Officer of MED PAPER, Mr. Mohsine Sefrioui has also been Chief Executive Officer of Nacinox and Cotamac since 1994 and of Maestro since 2006.

Presentation of the Members of the concerted action (other than Mr. Mohsine Sefrioui)

II.1. Presentation de Ms. Habiba Bennani

Ms. Habiba Bennani was born in 1925. She is a shareholder of the Company and has no operational role

in it.

II.2. Presentation de Ms. Ilham Sefrioui

Ms. Ilham Sefrioui was born in 1955. She holds a Bachelor of Laws.

II.3. Presentation de Mr. Mohammed Fouad Sefrioui

Mr. Mohammed Fouad Sefrioui was born in 1944. He is a trained architect.


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II.4. Presentation of Aliken

It should be noted that the partners, shareholders and board members of Aliken since the day the

threshold crossing triggered the obligation to deposit the Takeover Bid are presumed to act in concert

with it.

II.4.1. General information

Corporate Name Aliken

Headquarters 13, rue Souleimane Al Farissi, Casablanca

Legal Form A Limited Company (by decision of the Extraordinary General Meeting of Partners dated 6th July 2017)

Date of Establishment 19th May 1993

Life Span 99 years

Registry of Commerce Number 69931

Fiscal Year From January 1st to December 31st

Business purpose

In Morocco and abroad, the corporate objectives of the company are as follows:

Real estate agent activity and real estate intermediation

Marketing, buying and selling on its own account or on behalf of third parties of any real estate;

Completion of all requests and formalities (administrative, financial, legal and land) related to the real estate activity on its own account or on behalf of third parties;

The exploitation by all means and in particular by lease, of all built or unbuilt real estate that the company would own by means of acquisition, contribution or otherwise;

The exploitation by all means and in particular by lease, of all built or unbuilt real estate that the company would own by way of acquisition, contribution or otherwise;

Stake holding by way of acquisition, subscription or any other means, in any company having an object that is directly or indirectly related to the above operations;

And in general, all securities or real estate transactions, which may relate directly or indirectly to this object or likely to facilitate its realization or development.

Number of Shares 300,000

Share Capital MAD 30,000,000 with a par value of MAD 100 per share

List of Applicable Laws and Regulations

By its legal form, the company is governed by the law no. 17-95 promulgated by Dahir no. 1-96-124 dated 30th August 1996 relating to limited companies, as amended and supplemented by the laws no. 81- 99, 23-01 and 20-05, 78-12.

Court of competent jurisdiction Casablanca

Source: Aliken


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II.4.2. Information on Aliken Shareholding

Since its establishment, Aliken shareholding has evolved as follows:

Event Shareholders Number of Membership shares / shares

Establishment (1993) OIP 992 shares

Mr. Anas Sefrioui 8 shares

EGM of 31th December 1999 OIP 992 membership shares

Mr. Anas Sefrioui 8 membership shares

EGM of 31th March 2014 Bayt Al Hamd 992 membership shares

Mr. Anas Sefrioui 8 membership shares

EGM of 6th July 2017

Mr. Malik Sefrioui 99 999 shares

Ms. Kenza Sefrioui 99 999 shares

Ms. Alia Sefrioui 99 999 shares

Ms. Mounia Benzakri 2 shares

Bayt Al Hamd 1 share

Source: Aliken

Aliken was founded in 1993 as a limited company (S.A.).

The company was later converted into a Limited Liability Company in 1999 (S.A.R.L.).

In 2014, OIP sold all of its shares to Bayt Al Hamd.

By decision of the Extraordinary General Meeting of shareholders on 6th July 2017, it was decided to

reduce the capital of Aliken to zero MAD (MAD 0) by the cancellation of 1,000 shares of MAD 100 each,

followed by a capital increase of MAD 30,000,000 to bring it from MAD zero (MAD 0) to MAD

30,000,000, by creating 300,000 new shares of MAD 100 each with an issue premium of MAD 90,000,000

by setting-off unquestionable, liquid and due claims on the company.

As a result of the deliberations, the company was transformed into a limited company.

Following this operation, the shareholders of the company are Mr. Malik Sefrioui, Ms. Kenza Sefrioui, Ms.

Alia Sefrioui, Ms. Mounia Benzakri and the company Bayt Al Hamd.

II.4.3. Governance body

The administration of Aliken is entrusted to a board of directors. The board of directors is composed of

the three following members:

Members of the Board of Directors

Title Appointment date Appointment expiration date

Malik Sefrioui Chairman of the Board of Directors

6th July 2017 OGM ruling on the accounts of the fiscal year ending 2022

Mounia Benzakri Board Secretary 6th July 2017 OGM ruling on the accounts of the fiscal year ending 2022

Alia Sefrioui Board member 6th July 2017 OGM ruling on the accounts of the fiscal year ending 2022

Source: Aliken


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II.5. Financial situation of Aliken

It should be noted that the 2014, 2015 and 2016 financial statements of Aliken presented below have not

been reviewed by the statutory auditors.

In addition, as part of Aliken's transformation from a limited liability company to a limited company, and

in accordance with Article 36 of the Law 17-95 as amended and supplemented, a transformation

commissioner has certified that the net position as at 31/12/2016 is at least equal to one quarter of the

share capital.


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II.5.1. Balance sheet for the past three fiscal years

In MAD thousand 2 014 2 015 Var. 14/15 2 016 Var.15/16 CAGR 14-16

Fixed assets 2 006 1 336 -33.4% 1 012 -24.3% -29.0%

In % of total balance sheet 5.8% 3.7%

2.8%

Fixed assets in non-value 0 0 n.a. 0 n.a. n.a.

Intangible assets 0 0 n.a. 0 n.a. n.a.

Tangible assets 771 323 -58.1% 0 -100.0% -100.0%

Financial fixed assets 1 235 1 012 -18.1% 1 012 0.0% -9.5%

Current assets 32 268 34 468 6.8% 35 301 2.4% 4.6%


97.0%

Inventory 174 174 0.0% 174 0.0% 0.0%

Receivables 10 532 10 242 -2.8% 10 287 0.4% -1.2%

Securities and investment securities 21 561 24 051 11.5% 24 839 3.3% 7.3%

Translation-asset differences 0 0 n.a. 0 n.a. n.a.

Cash assets 91 124 36.3% 89 -28.2% -1.1%


0.2%

Total Assets 34 365 35 927 4.5% 36 402 1.3% 2.9%

Source: Aliken

In MAD thousand 2 014 2 015 Var. 14/15 2 016 Var.15/16 CAGR 14-16

Equity -72 299 -85 376 -18.1% -84 894 0.6% -8.4%

In % of total balance sheet n.s. n.s.

n.s.

Share capital 100 100 0.0% 100 0.0% 0.0%

Issue, merger, contribution premiums 0 0 n.a. 0 n.a. n.a.

Legal reserve 0 0 n.a. 0 n.a. n.a.

Investment reserve 0 0 n.a. 0 n.a. n.a.

Volunteer reserve 0 0 n.a. 0 n.a. n.a.

Retained earnings -63 777 -72 399 -13.5% -85 476 -18.1% -15.8%

Net income for the fiscal year -8 623 -13 077 -51.7% 482 n.a. n.a.

Financial debts 0 0 n.a. 0 n.a. n.a.


0.0%

Other financing debts 0 0 n.a. 0 n.a. n.a.

Current liabilities 106 474 121 301 13.9% 121 294 0.0% 6.7%


333.2%

Current liabilities debts 106 474 121 301 13.9% 121 294 0.0% 6.7%

Other provisions for risks and charges 0 0 n.a. 0 n.a. n.a.

Translation-liability differences 0 0 n.a. 0 n.a. n.a.

Cash-liability 190 2 -98.9% 2 0.0% -89.7%


0.0%

Total Liabilities 34 365 35 927 4.5% 36 402 1.3% 2.9%

Source: Aliken


14

Financial fixed assets

The financial assets item amounts to MAD 1.0 million in 2016. It consists of a loan to a related company.

Inventory

The company's inventory amounts to MAD 0.2 million over the 2014-2016 period. It represents a land

plot owned by the company.

Receivables

Receivables rose from MAD 10.5 million in 2014 to MAD 10.2 million in 2016. This item includes, in

2016, an advance from suppliers of MAD 4.4 million and advances made to companies of the group for

MAD 2.7 million.


15

II.5.2. Income statement for the past three fiscal years

In MAD thousand 2 014 2 015 Var. 14/15 2 016 Var.15/16 CAGR 14-

16

Turnover 0 0 n.a. 0 n.a. n.a.

Product inventory variation 0 0 n.a. 0 n.a. n.a.

Operating reversals; charge transfer 0 0 n.a. 0 n.a. n.a.

Operating income 0 0 n.a. 0 n.a. n.a.

Purchases consumed (2) of materials and supplies

0 0 n.a. 0 n.a. n.a.

Other external charges 1 507 1 364 -9.5% 2 477 81.6% 28.2%

Duties and taxes 16 16 0.0% 16 0.0% 0.0%

Staff costs 0 0 n.a. 0 n.a. n.a.

Other operating expenses 0 0 n.a. 0 n.a. n.a.

Depreciation & Amortization 448 448 0.0% 323 -27.9% -15.1%

Operating income -1 971 -1 827 7.3% -2 816 -54.1% -19.5%

Income from equity securities and other investment securities

720 1 472 104.4% 3 188 116.6% 110.4%

Exchange gains 0 0 n.a. 0 n.a. n.a.

Interests and financial revenues 6 997 3 146 -55.0% 3 683 17.1% -27.4%

Financial reversals; charge transfer 0 0 n.a. 4 353 n.a. n.a.

Financial products 7 717 4 618 -40.2% 11 224 143.0% 20.6%

Interest expenses 16 18 12.5% 10 -44.4% -20.9%

Exchange losses 0 0 n.a. 0 n.a. n.a.

Other financial charges 6 044 5 493 -9.1% 7 866 43.2% 14.1%

Financial allocations 8 249 10 387 25.9% 0 -100.0% n.a.

Financial expenses 14 309 15 897 11.1% 7 876 -50.5% -25.8%

Financial income -6 592 -11 279 -71.1% 3 348 n.a. n.a.

Current income -8 563 -13 106 -53.1% 532 n.a. n.a.

Non-current revenue 0 69 n.a. 0 n.s. n.a.

Non-current expenses 25 24 -4.0% 32 33.3% 13.1%

Non-current income -25 46 n.a. -32 n.a. -13.1%

Pre-tax income -8 588 -13 061 -52.1% 500 n.a. n.a.

Corporate Taxes 35 16 -54.3% 18 12.5% -28.3%

Net Income -8 623 -13 077 -51.7% 482 n.a. n.a.

Source: Aliken


16

Operating expenses

In 2016, operating expenses mainly comprise of commissions paid to financial intermediaries.

Financial products

Financial products amounted to MAD 11.2 million in 2016. They consist mainly of dividends received on

the sale of shares held by the company for MAD 3.2 million and reversals of financial provisions for

MAD 4.4 million.

Financial expenses

In 2016, Aliken's financial expenses mainly include capital losses realized on disposals of shares held by the company.


17

GENERAL PRESENTATION OF THE COMPANY


18

Evolution of shareholder structure

The evolution of MED PAPER’s shareholder structure over the 2015-2017 period is presented in the

table below:

Shareholders 31/12/2015 31/12/2016 31/12/2017

Nb. of shares Capital % Nb. of shares Capital % Nb. of shares Capital %

Aliken - - - - 814 037 31.52%

Mohsine Sefrioui 469 509 18.20% 469 509 18.20% 493 469 19.11%

Habiba Bennani 114 149 4.40% 114 149 4.40% 114 049 4.42%

Med Fouad Sefrioui 108 467 4.20% 108 467 4.20% 52 992 2.05%

Ilham Sefrioui 8 732 0.30% 8 732 0.30% 26 867 1.04%

CDG Développement 930 931 36.10% 930 931 36.10% - -

Floating 950 767 36.80% 950 767 36.80% 1 081 141 41.86%

Total 2 582 555 100.00% 2 582 555 100.00% 2 582 555 100.00%

Source: MED PAPER

The graphic below shows the shareholder structure of the Company as at 31/01/2018:

Source : MED PAPER

During the 2017 fiscal year, CDG Développement declared that it no longer holds any MDP shares

following a contribution of 462,300 MED PAPER shares on 29th June 2017 and a sale of 358,631 MED

PAPER shares on 3rd July 2017.

Also, on 3rd July 2017, Aliken acquired 814,037 MED PAPER shares on the market, making it the main

shareholder of the Company.

Board of Directors

As at 31st January 2018, the Board of Directors of the Company is composed as follows:

Members of the Board of Directors

Title Appointment date Appointment expiry date

Mohsine Sefrioui Chairman of the Board 25/06/2 015 OGM ruling on the accounts of the fiscal year ending 2020

Mohamed Fouad Sefrioui Board Member 25/06/2 015 OGM ruling on the accounts of the fiscal year ending 2020

Khalid Sefrioui Board Member 25/06/2 015 OGM ruling on the accounts of the fiscal year ending 2020

Sanaa Messaoudi Board Member 19/09/2 017 OGM ruling on the accounts of the fiscal year ending 2022

Mohamed Anouar Bennani Board Member 19/09/2 017 OGM ruling on the accounts of the fiscal year ending 2022

Kamal Mazari Board Member 19/09/2 017 OGM ruling on the accounts of the fiscal year ending 2022

Salah-Eddine Sabik Board Member 19/09/2 017 OGM ruling on the accounts of the fiscal year ending 2022

AlikenMohsine

Sefrioui

Fouad

Sefrioui

Habiba

Bennani

Ilham

SefriouiFlottant


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Source: MED PAPER

The MED PAPER Ordinary General Meeting, held in 2015, renewed the mandate of Mr. Mohsine

Sefrioui as a Chief Executive Officer and Chairman of the Board.

Following the departure of the three Board Members representing the interests of CDG Développement

as a result of the sale of the entire shareholding in the Company, four new Board Members were co-opted

at the Board Meeting held on 11th August 2017. This decision was ratified by the EGM held on 19th

September 2017.


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MED PAPER’s financial position

III.1. Income statement

In MAD thousand 2014 2015 Var. 14/15 2016 Var. 15/16 CAGR 14-

16

Turnover 116 885 101 631 -13.1% 83 335 -18.0% -15.6%

Product inventory variation -9 031 -14 509 -60.7% -2 496 82.8% 47.4%

Operating reversals; charge transfer 0 78 047 n.a. 7 582 -90.3% n.a.

Operating income 107 854 165 170 53.1% 88 421 -46.5% -9.5%


73 907 61 666 -16.6% 57 724 -6.4% -11.6%

Other external charges 12 000 11 762 -2.0% 10 055 -14.5% -8.5%

Duties and taxes 925 877 -5.2% 848 -3.4% -4.3%

Staff costs 26 060 23 877 -8.4% 20 907 -12.4% -10.4%

Other operating expenses 0 77 093 n.a. 7 709 -90.0% n.a.

Depreciation & Amortization 19 727 16 129 -18.2% 13 405 -16.9% -17.6%

Operating income -24 764 -26 236 -5.9% -22 227 15.3% 5.3%


9 9 0.0% 9 0.0% 0.0%

Exchange gains 282 321 14.0% 169 -47.4% -22.6%

Interests and financial revenues 0 -241 n.a. 0 -100.0% n.a.

Financial reversals; charge transfer 67 188 180.4% 211 12.7% 77.8%

Financial products 357 277 -22.6% 389 40.6% 4.3%

Interest expenses 15 018 10 755 -28.4% 9 431 -12.3% -20.8%

Exchange losses 422 589 39.7% 337 -42.7% -10.5%

Financial allocations 188 211 12.7% 502 137.4% 63.6%

Financial expenses 15 627 11 555 -26.1% 10 270 -11.1% -18.9%

Financial income -15 270 -11 278 26.1% -9 881 12.4% 19.6%

Current income -40 034 -37 514 6.3% -32 108 14.4% 10.4%

Non-current revenue 10 18 331 n.s. 3 427 -81.4% n.s.

Non-current expenses 64 497 681.7% 32 -93.6% -29.4%

Non-current income -54 17 834 n.s. 3 395 -81.0% n.s.

Pre-tax income -40 088 -19 680 50.9% -28 713 -45.9% 15.4%

Corporate taxes 586 601 2.7% 435 -27.7% -13.9%

Net Income -40 674 -20 281 50.1% -29 148 -43.7% 15.3%

Source: MED PAPER


21

III.2. MED PAPER’s balance sheet

The table below presents the evolution of MED PAPER's balance sheet over the 2014-2016 period:

In MAD thousand 2014 2015 Var. 14/15 2016 Var. 15/16 CAGR 14-

16

Fixed assets 193 898 182 717 -5.8% 172 943 -5.3% -5.6%

In % of total balance sheet 48.0% 51.0% 50.8%

Fixed assets in non-value 614 1 043 69.9% 631 -39.5% 1.4%

Intangible assets 66 007 66 001 0.0% 66 007 0.0% 0.0%

tangible assets 125 638 114 035 -9.2% 104 668 -8.2% -8.7%

Financial fixed assets 1 638 1 638 0.0% 1 638 0.0% 0.0%

Current assets 209 099 173 921 -16.8% 166 757 -4.1% -10.7%


Inventory 58 433 36 424 -37.7% 32 717 -10.2% -25.2%

Receivables 150 478 137 285 -8.8% 133 538 -2.7% -5.8%

Translation-asset differences 188 211 12.4% 502 137.4% 63.3%

Cash assets 1 352 1 958 44.9% 504 -74.3% -38.9%


0.1%

Total Assets 404 349 358 596 -11.3% 340 204 -5.1% -8.3%

Source: MED PAPER

In MAD thousand 2014 2015 Var. 14/15 2016 Var. 15/16 CAGR 14-16

Equity 21 002 721 -96.6% -28 427 n.s. n.s.

In % of total balance sheet 5.2% 0.2% -8.4%

Share capital or personal 258 256 258 256 0.0% 258 256 0.0% 0.0%

Issue, merger, contribution premiums 150 156 150 156 0.0% 150 156 0.0% 0.0%

Legal reserve 4 572 4 572 0.0% 4 572 0.0% 0.0%

Investment reserve 31 800 31 800 0.0% 31 800 0.0% 0.0%

Volunteer reserve 10 781 10 781 0.0% 10 781 0.0% 0.0%

Retained earnings -393 889 -434 563 10.3% -454 844 4.7% 7.5%

Net income for the fiscal year -40 674 -20 281 -50.1% -29 148 43.7% -15.3%

Financial debts 134 058 128 713 -4.0% 125 400 -2.6% -3.3%


Other financing debts 134 058 128 713 -4.0% 125 400 -2.6% -3.3%

Current liabilities 112 883 87 315 -22.6% 97 909 12.1% -6.9%


Current liabilities debts 112 298 86 977 -22.5% 97 363 11.9% -6.9%

Other provisions for risks and charges 188 211 12.7% 502 137.4% 63.6%

Translation-liability differences 397 127 -68.1% 45 -64.7% -66.5%

Cash-liability 136 407 141 847 4.0% 145 321 2.4% 3.2%


Total Liabilities 404 349 358 596 -11.3% 340 204 -5.1% -8.3%

Source: MED PAPER


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III.3. Cash-Flow Statement

In MAD thousand 2014 2015 Var. 14/15 2016 Var. 15/16

Self-financing capacity -25 825 -6 774 73.8% -15 751 -132.5%

Disposals and reduction of fixed assets 0 0 n.a. 9 n.s.

Total stable resources -25 825 -6 774 73.8% -15 742 -132.4%

Acquisitions and capital increase 496 1 445 191.5% 3 631 151.3%

Repayment of financing debts 5 250 5 345 1.8% 3 313 -38.0%

Non-value uses 255 882 245.7% 0 -100.0%

Total stable uses 6 001 7 671 27.8% 6 944 -9.5%

Variation in the need for global financing -36 298 -9 612 73.5% -17 757 -84.8%

Cash position variation 4 473 -4 834 n.a. -4 929 -2.0%

Net Cash -135 055 -139 889 -3.6% -144 817 -3.5%

Source: MED PAPER


23

MED PAPER’s interim financial position

IV.1. Income statement

In MAD thousand 30/06/2016 30/06/2017 Var. 16/17

Turnover 40 231 37 498 -6.8%

Product inventory variation -2 867 1 790 n.a.

Operating income 37 364 39 288 5.1%


25 900 25 092 -3.1%

Other external charges 5 427 4 635 -14.6%

Duties and taxes 436 451 3.6%

Staff costs 9 730 10 605 9.0%

Other operating expenses 0 0 n.a.

Depreciation & Amortization 6 670 6 759 1.3%

Operating income -10 799 -8 255 23.6%


0 0 n.a.

Exchange gains 65 150 132.8%

Interests and financial revenues 0 0 n.a.

Financial reversals; charge transfer 211 502 137.4%

Financial products 276 652 136.3%

Interest expenses 4 755 3 812 -19.8%

Exchange losses 140 164 17.0%

Financial allocations 0 0 n.a.

Financial expenses 4 895 3 977 -18.8%

Financial income -4 619 -3 325 28.0%

Current income -15 418 -11 579 24.9%

Income from disposal of fixed assets 0 32 500 n.a.

Other non-current revenue 1 304 n.s.

NBV of sold fixed assets 0 173 n.a.

Other non-current expenses 28 62 125.9%

Non-current income -27 32 570 n.a.

Pre-tax income -15 445 20 990 n.a.

Corporate Taxes 201 187 -6.8%

Net Income -15 646 20 803 n.a.

Source: MED PAPER


24

IV.2. MED PAPER balance sheet


Fixed assets 172 943 167 618 -3.1%


Fixed assets in non-value 631 517 -18.0%

Intangible assets 66 007 66 004 0.0%

tangible assets 104 668 99 459 -5.0%

Financial fixed assets 1 638 1 638 0.0%

Current assets 166 757 126 388 -24.2%


Inventory 32 717 34 233 4.6%

Receivables 133 538 92 154 -31.0%

Translation-asset differences 502 0 -100.0%

Cash assets 504 277 -45.0%


Total Assets 340 204 294 283 -13.5%

Source: MED PAPER


Equity -28 427 -7 624 73.2%

In % of total balance sheet -8.4% -2.6%

Share capital or personal 258 256 258 256 0.0%

Issue, merger, contribution premiums 150 156 150 156 0.0%

Legal reserve 4 572 4 572 0.0%

Investment reserve 31 800 31 800 0.0%

Volunteer reserve 10 781 10 781 0.0%

Retained earnings -454 844 -483 992 -6.4%

Net income for the fiscal year -29 148 20 803 n.a.

Financial debts 125 400 69 022 -45.0%


Other financing debts 125 400 69 022 -45.0%

Current liabilities 97 909 104 064 6.3%


Current liabilities debts 97 363 104 064 6.9%

Other provisions for risks and charges 502 0 -100.0%

Translation-liability differences 45 0 -100.0%

Cash-liability 145 321 128 821 -11.4%


Total Liabilities 340 204 294 283 -13.5%

Source: MED PAPER


25

IV.3. Cash-Flow Statement


Self-financing capacity -8 976 -4 765 46.9%

Disposals and reduction of fixed assets 0 32 500 n.a.

Total stable resources -8 976 27 735 n.a.

Acquisitions and capital increase 502 1 607 220.4%

Repayment of financing debts 2 830 56 379 n.s.

Non-value uses 0 0 n.a.

Total stable uses 3 332 57 985 n.s.

Variation in the need for global financing -8 691 -46 524 -435.3%

Cash position variation -3 617 16 274 n.s.

Net Cash -143 506 -128 544 10.4%

Source: MED PAPER


26

RISK FACTORS OF THE COMPANY


27

Environmental risk

This risk is materialized by the possibility of a tightening of the regulatory environment in which the

Company operates. At present, there is no specific environmental regulation in Morocco with regard to

the paper industry, especially concerning the upgrading of its waste and the minimization of the impact of

its waste on its environment.

The standardization of the production process in the context of the environmental constraints applied in

Europe could force the Company to make significant investments to comply with the legislation.

Operational risk

Operational risk is the degree of uncertainty associated with the assets generated by an investment and its

ability to provide a return.

In the case of MED PAPER, this risk is materialized in particular by the difficulty for the company of

sourcing raw material, the difficulties encountered by the Company to recover its debts as well as the

strong competition from which it suffers.

In addition, the Company is experiencing difficulties in financing its activity, particularly for the supply of

raw materials. In this context, the Company is negotiating with its banks to unblock the situation.

Finally, it should be noted that the Company's production and processing equipment could hinder its

ability to compete with products imported into Morocco due to its relative obsolescence.

Risk related to the availability of waste paper (main input of packaging products)

The company wants to increase its offering of packaging products and paper bags. Nevertheless, the

financing difficulties and the lack of raw material (mainly waste paper), may limit MED PAPER's

development forecasts.

Risk related to the plastic bag segment

Between 2015 and 2016, the company acquired the machines for making paper bags. However, the plastic

bag has not completely disappeared limiting the demand for paper bags.

In addition, other lines of bag products (like the woven and non-woven polypropylene bag) are available

on the national market.

These two factors mentioned above may limit the return on investment made by MED PAPER to gain

market share in this segment.

Customer risk

The Company is confronted with the problem of unpaid debts which weakens its financial base and

increases the tensions on its cash flow in a competitive environment.

Risk linked to the evolution of raw material prices

This risk covers the difficulties related to the importation of some of the inputs consisting mainly of pulp

(especially long-fiber). Pulp is exposed to erratic variations in international markets.

This volatility is likely to have an impact on the Company's storage policy, income and the management of

its cash flow.

Risk of dependence on a group of customers

The Company generates a portion of its sales with wholesalers, semi-wholesalers and processors.

In addition, the Company has historically realized a significant portion of its sales with Cosumar.


28

Currency risk

In addition to exposure to fluctuations in raw materials (mainly paper pulp) denominated in dollars, the

Company is exposed to the volatility between invoicing and payment currencies that may impact its

income and financial situation.

Demand risk

National demand for print-writing paper is closely correlated with enrollment rates, literacy levels, and

changes in household purchasing power.

Situational cyclicality may lead in its wake to variations in this demand.

Nevertheless, the low per capita print-writing consumption ratios recorded in Morocco contain the risk of

a sharp drop in demand for products marketed by the Company.

Competitive risk

The competitive risk can be materialized by the arrival of a new competitor, by bringing together

operators of the sector at the national level as well as by the erosion of the market shares held by the

Company (MED PAPER) for lack of competitiveness by applied prices and / or because of insufficient

quality of the products marketed.

The Company is also exposed to aggressive competition from informal operators. These practices

encouraged by the existence of customs barriers to entry should logically lose their meaning with the

ongoing customs dismantling. From now on, the difference between the operators should essentially

concern the quality of the products offered.

Tax risk

The Company has been the subject of three successive tax audits covering the 2014 and prior fiscal years,

which resulted in notifications totaling approximately MAD 10 million excluding surcharges and late

penalties.

The management of the Company has rejected all of the adjustments notified by the tax authorities and

has not recorded any corresponding provision. It has also initiated discussions with the said administration

with a view to definitively settling these tax disputes.

During the second half of 2017, the Company reached an amicable agreement with the tax authorities

concerning the abandonment of a portion of the debt relating to tax adjustments through the payment of

MAD 1.7 million. Negotiations are continuing to reach an amicable agreement on the remaining part.

Risk of non-execution of the Business Plan

The Company is in a difficult situation, particularly in terms of business, operations and finance. The

uncertainty associated with the outlook is therefore higher and the effective achievements could deviate

significantly from the forecasts.

Labor risk

A labor conflict has gained the Company following the sudden stop of the production and the damage of

the machines.

The management of MED PAPER has decided to dismiss the persons concerned and prosecute them for

material damage and sabotage. The company may be forced to pay MAD 17 million in this dispute. This

amount is not provisioned in the accounts of the Company.


29

Climate risk

Climate risk is a risk linked to the vulnerability of the Company to variations in climate indices characterizing the Northern region (precipitation, floods, etc.).


30

DISCLAIMER

The aforementioned information is only a part of the prospectus approved by the Moroccan Capital Market Authority (AMMC) under the reference No. VI/EM/003/2018 on the 6th of March 2018.

The AMMC recommends that the prospectus in French, made available to the public, be read in full.

Documents

Prospectus Summary · 5 Publication of the extract of the prospectus in a legal gazette 08/03/2018 6 Opening of the duration of the Takeover Bid 14/03/2018 7 Closing of the duration