Deutsche Beteiligungs AG

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Deutsche Beteiligungs AG Opportunity to invest

• German Mid Cap ConferenceFrankfurt am Main,
  November 26, 2003

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Contents

• Overview
• Investment strategy in German speaking countries
• Investments abroad
• Fund management
• Financial year 2002/2003 Investments and
  disinvestments
• Deutsche Beteiligungs AG A good investment
  opportunity
• Annex

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Deutsche Beteiligungs AG - Overview

• 40 years of private equity experience
• More than 300 German mid-market transactions
• Remarkable success story
• 16.3 return on equity (p.a., 1992/93 to
  2001/02)
• Good market position
• Capital requirements for further investments
• Listed since 1985
• 3 principal investors (45 )
• Free float 49.92
• Market capitalization 170 mn

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Business activities

• Focus on management buyouts
• Direct buyout investments in German-speaking
  countries
• Foreign buyout investments through experienced
  fund partners
• Growth financings (minority investments) in
  exceptional cases only
• Fund management
• Fee income for cost coverage
• Access to larger transactions through additional
  financings (parallel funds)

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Well-balanced portfolio
Status Acquisition costs, Date October 31, 2003
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Focus on MBOs Investment criteria

• Mid-market businesses / Group subsidiaries
• Old economy industry, industrial service sectors
• Turnover up to 750 mn p.a.
• Proven management
• Leading market position
• Profitable, with growth potential
• Transaction value 50 250 mn

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Case study Casco How Deutsche Beteiligungs AG
builds value

• Company
• World market leader in the development,
  manufacture and marketing of impregnated foils
  and other surface materials for floorings,
  furniture, and construction industry
• Sales (2002) 265 mn928 employees in eight
  countries
• Investment
• Management buyout led by Deutsche Beteiligungs
  AG, jointly with US-Partner
• Investment 12.4 mn

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Casco Surfaces GmbH

• Build value through
• Internal growth potential
• Development of new markets (Brazil, South East
  Asia)
• Launch of new, high-margin products
• Earnings enhancement by optimizing product mix
  and improving cost structure in Europe (site
  optimization)
• Exit opportunities
• Trade sale to buyer, in whose process chain Casco
  fits
• IPO

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Case Study Sebaldus How Deutsche Beteiligungs AG
built value

• Company
• Major German media business, four categories
  Publishing, Printing, Direct Marketing,
  Electronic Media
• Turnover (1997) 476 mn, 3,700 employees
• Outset
• Increasing competition, market position attacked
  
• Group of 196 shareholders with different
  objectives
• No capital for growth
• Investment
• MBO in August 1997 (jointly with other finance
  investors)
• Investment 16.7 mn

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Sebaldus AG

• Growth in value through focus on core businesses
• Core business Printing
• - add-on acquisition
• - new printing press
• Core business Publishing
• - acquisition of majority in Austrian publisher
  Metro
• - IPO for Computec Media AG
• Business field Electronic Media sold
• Exit
• Printing and Direct Marketing activities sold to
  Schlott AG in December 1999
• Publishing activities sold to WAZ Group in
  November 2000
• Invested capital tripled

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Experienced investment team

• average yrs. of private-equity experience at
  DBAG
• 4 Principals gt 12
• 7 Directors gt 8
• 10 Investment Managers gt 5
• Management remuneration with strong incentive
  system
• Carried-interest scheme installed in 2001
• Investment team must co-invest to profit from
  performance of investments

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Three out of four German deals through
proprietary channels

• Excellent network provides proprietary deal
  access
• Avoids costly auction bids
• Greater deal probability

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Deal activity Germany transaction value 50
250 mn
Jan. to Oct.

• Deutsche Beteiligungs AG
• 2002 involved in the completion of two
  transactions,
• 2003 in the completion of three transactions

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Growth drivers for mid-market deals

• Key growth driverSpin-offs of non-core
  activities by large corporations
• Other growth drivers
• Regulatory pressure on banks to cut back on
  lending (Basel II)
• Succession issue for family-owned companies

? Positive mid-market development
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Portfolio diversification through international
investments

• Fund partnerships benefit business in German
  speaking countries
• Cross-border deals (Casco Surfaces)
• Additionally Portfolio diversification
• Comparable investment criteria
• Collaboration with experienced partners
• USA Harvest Partners
• Austria Unternehmens Invest AG (UIAG)
• France Quartus Gestion

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New equity financing - Investors confide in the
team

• Fund IV 228 mn committed largest
  equity-raising program to date
• Fee income for cost coverage
• Investment ratio Deutsche Beteiligungs AG / DBAG
  Fund IV 12

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Financial year 2002/2003 Difficult environment

• Exit markets remain difficult
• Strategic investors (trade sales) restrained
• Financial investors a stable pillar
• IPOs not possible
• No economic growth
• Challenge for portfolio companies
• But Attractive investment opportunities
• Restructuring of "Deutschland AG" (Corporate
  Germany)
• Capital markets pressuring large conglomerates

? Invest anticyclically
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Profitable exits despite market weakness

• Edscha AG Secondary BuyoutInvestment October
  2000Exit November 2002 IRR gt 25 p.a.
• Andritz AG Secondary PlacementInvestment
  December 1999Exit (82 ) June 2003 IRR
  invested capital doubled, gt 20 p.a.
• Global Power Equipment Group Inc. Stock
  ExchangeInvestment August 2000Exit (gt 50 )
  July 2003 IRR invested capital doubled, gt 20
  p.a.

? Value growth realized
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Financial year 2002/2003 Nine-months results

• Balanced quarterly result
• Sales proceeds largely consumed by valuation
  adjustments
• Weak US economygt Valuation adjustments on three
  portfolio companies and one fund investment
• Other operating income significantly above
  previous year's level
• Management fees
• Structuring fees
• Appreciation in value
• Outlook Balanced total result
• Significant improvement vs. previous year

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Recent investments

• Casco Surfaces Management buyoutInvested in
  July 2003Chemicals Investment 12.4 mn
• Preh-Werke Management buyoutInvested in
  November 2003Automotive supplier Investment
  12.8 mn
• BBS Management buyoutInvested in November
  2003Industrial services Investment 10.0 mn

? Strong market position
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Shareholder profile
Deutsche Bank AG15
Gerling Group15
Free Float49.92
Vermögensverwaltung Wilhelm von Finck15
Kreissparkasse Biberach5.08

• S-Dax indexed
• Free float enlarged to 49.92
• Market capitalization of free float 84mn

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Share price
euros
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Shares trade at book-value level
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Private equity outperforms other asset classes
16.3

• Private equity returns over 10-year period 15
  percentBase 196 European buyout funds, Horizon
  IRR 1993 to 2002
• Private equity returns higher than other asset
  classes

14.8
16.0
12.0
7.0
8.0
6.0
4.0
0.0
Private equity
Fixed-interest bearing
securities
Source Pan-European Performance Study, EVCA,
March 2003
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Deutsche Beteiligungs AG a good investment
opportunity

• Deutsche Beteiligungs AG founded in 1965

• Long-established brand name
• Track record
• Diversification
• Experience

• av. pre-tax 1 year - 9.3 ROE p.a. 3 years
  7.4 5 years 18.2 10 years 16.3

• Broad, balanced portfolio of assets

• in managing economic and market cycles
• Ability to realize exits
• Benefit of network access to deal flow
• Disciplined investment process

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Annex
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Valuation rules ofInternational Accounting
Standards

• Valuation principles based on IAS rules
• Valuation based on
• Stock market prices
• Purchase offers
• Comparable transactions
• Multiples method (e.g. peer group comparisons)
• Sum of the Parts assessment

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Shareholders equity
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Investments
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Result from investment activity

Consolidated as of FY 2001/02 Before
write-offs and provisions First 3 quarters
31
Net income/loss



consolidated
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Typical investment structure
Target company
10
30
60
DBAG Fund IV
Deutsche Beteiligungs AG
1
2

Management of target company
1 investment by carry team ofDeutsche
Beteiligungs AG
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Ten largest investments represent 61 of book
value
Status July 31, 2003
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Most recent ten exits DBAG not dependent on IPOs
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Financial calendar 2004
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Creating a new Mittelstand
Stock abbreviation Reuters DBAG.F Bloomberg
DBA ISIN code DE0005508105 Stock market
trading with official listing in PRIME
STANDARD Indices S-Dax C-Dax-Industrial
For more information www.deutsche-beteiligung.c
om Deutsche Beteiligungs AG Investor
RelationsKleine Wiesenau 1 Thomas Franke60323
Frankfurt am Main Tel. [phone]
07Tel. [phone] Fax [phone]
87-3 91 e-mail IR_at_deutsche-beteiligung.de
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Cautionary statement regarding forward-looking
statements
This presentation contains forward-looking
statements. Forward-looking statements are
statements that are not historical facts,
including statements about our beliefs and
expectations. Any statement in this presentation
that states our intentions, beliefs, expectations
or predictions (and the assumptions underlying
them) is a forward-looking statement. These
statements are based on plans, estimates and
projections as they are currently available to
the management of Deutsche Beteiligungs AG.
Forward-looking statements therefore speak only
as of the date they are made, and we undertake no
obligation to update publicly any of them in
light of new information or future
events. Forward-looking statements involve
inherent risks and uncertainties. A number of
important factors could therefore cause actual
results to differ materially from those contained
in any forward-looking statement. Such factors
include the conditions in the financial markets
in Germany, in Europe, in the United States and
elsewhere from which we derive a substantial
portion of our business.