Heidelberger Druckmaschinen AG: Heidelberg enters into agreement with Masterwork Group Co., Ltd. from China which intends to acquire a stake in Heidelberg via capital increase

DGAP-Ad-hoc: Heidelberger Druckmaschinen AG / Key word(s): Capital Increase/Strategic Company Decision Heidelberger Druckmaschinen AG: Heidelberg enters into agreement with Masterwork Group Co., Ltd. from China which intends to acquire a stake in Heidelberg via capital increase 23-Jan-2019 / 09:10 CET/CEST Disclosure of an inside information acc. to Article 17 MAR of the Regulation (EU) No 596/2014, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. Heidelberg steps up activities in the packaging market and gains potential strategic anchor shareholder Today, the management board of Heidelberger Druckmaschinen AG (Heidelberg) has signed an invest-ment agreement with a strategic investor. Masterwork Group Co., Ltd. (Masterwork) based in the Chinese city of Tianjin intends to acquire a stake in Heidelberg in an amount of approx. 8.5 percent of Heidelberg's share capital by way of a cash capital increase from authorized capital with an exclusion of shareholders' subscription rights. The implementation of such capital measure is subject to approval by Heidelberger Druckmaschinen AG's supervisory board. The proposed capital increase provides the opportunity for Heidelberg to acquire a further strategic anchor shareholder with a long-term investment horizon as well as to strengthen its equity. Furthermore, in the context of pending negotiations Heidelberg will examine whether Heidelberg can significantly expand its long-standing strategic distribution partnership with Masterwork, China's largest manufacturer of die-cutters and hot-foil embossing machines. Thereby, Heidelberg aims to further enhance its market position in the growing area of packaging printing. Subject to approval by the relevant bodies on both sides and the Chinese authorities, the corresponding capital measure is expected to be implemented by the end of the first calendar quarter 2019. The issue price of the new shares is set to be EUR 2.68. If the development of the market price significantly exceeds the envisaged issue price, there will be renegotiations taking into account the applicable statutory requirements. Heidelberg intends to use the funds received from the capital increase to accelerate its digital agenda (digitizing products, processes and business models, for example) and for the financing of the general business. www.heidelberg.com Contact: Heidelberger Druckmaschinen AG Corporate Public Relations Thomas Fichtl Phone: [phone] Fax: [phone] E-mail: [e-mail] Investor Relations Robin Karpp Phone: [phone] Fax: [phone] 67120 E-Mail: [e-mail] Important note: This press release contains forward-looking statements based on assumptions and estimations by the Management Board of Heidelberger Druckmaschinen Aktiengesellschaft. Even though the Management Board is of the opinion that those assumptions and estimations are realistic, the actual future development and results may deviate substantially from these forward-looking statements due to various factors, such as changes in the macro-economic situation, in the exchange rates, in the interest rates, and in the print media industry. Heidelberger Druckmaschinen Aktiengesellschaft gives no warranty and does not assume liability for any damages in case the future development and the projected results do not correspond with the forward-looking statements contained in this press release.     Information and Explanation of the Issuer to this News: Heidelberg steps up activities in packaging market and gains potential strategic anchor shareholder  Masterwork Group Co., Ltd. from China aiming to use capital increase to obtain a stake in Heidelberg Increase in equity ratio set to improve Heidelberg balance sheet Sales partnership dating from 2013 being taken to next level in growing packaging printing segment Closer production collaboration set to boost efficiency Heidelberger Druckmaschinen AG (Heidelberg) is looking to further improve its market position in the growing packaging printing segment by taking its long-standing sales partnership with Masterwork Group Co., Ltd. (Masterwork), China's largest manufacturer of die-cutters and hot-foil embossing machines, to a whole new level. Based in the Chinese city of Tianjin, Masterwork is to obtain around 8.5 percent of the Heidelberg share capital under a cash capital increase from authorized capital excluding shareholder subscription rights. The implementation of such capital measure is subject to approval by Heidelberger Druckmaschinen AG's supervisory board. The proposed capital increase provides the opportunity for Heidelberg to acquire a further strategic anchor shareholder with a long-term investment horizon as well as to strengthen its equity. Subject to approval by the relevant bodies on both sides and the Chinese authorities, the capital measure should provisionally take place by the end of the first calendar quarter of 2019. The issue price of the new shares is set to be EUR 2.68. If the market price significantly outstrips the envisaged issue price, this will be renegotiated in line with statutory requirements. The funds Heidelberg generates with the capital increase are to be used to accelerate its digital agenda (digitizing products, processes, and business models, for example) and for general business financing. Masterwork supports the Heidelberg strategy and is demonstrating its clear commitment to long-term collaboration. Heidelberg is currently considering and discussing whether it will seek to obtain a shareholding in Masterwork.   'The Heidelberg Management Board and Supervisory Board are delighted that our long-standing, successful collaboration with Masterwork is to become much closer. This opens up further potential in the growing packaging printing segment, especially in China - the world's largest individual market. We are expecting better capacity utilization at our plants across the globe to make us far more efficient, but I would like to stress that this will not weaken our sites in Germany. We are delighted that in Masterwork we are obtaining another long-term investor that firmly believes in the company's innovative prowess, strategy, and potential for the future,' comments Heidelberg CEO Rainer Hundsdörfer.   'Heidelberg is our ideal partner for jointly leveraging growth potential in the packaging printing market. The stake we are obtaining in this long-established company and world market leader underlines that we are in it for the long haul and are confident Heidelberg has adopted the right strategy,' says Masterwork President Li Li.   Building on leading market position in growing packaging printing segment Heidelberg and Masterwork, which is listed on China's Shenzhen stock exchange, have operated a close postpress partnership for a number of years, turning print products into folding cartons for the packaging market. They also benefit from a long-standing, successful sales collaboration. Masterwork specializes in postpress equipment for the folding carton industry. Back in 2014, it acquired the postpress packaging technologies of Heidelberg, which retains responsibility for global sales and digital customer relations. The possibility of linking Masterwork's postpress machines to the Heidelberg cloud is a big advantage when it comes to realizing the value proposition of using production data to boost customers' productivity. Packaging printing is expected to enjoy above-average growth in the coming years. Heidelberg already holds a leading position in this segment in Europe and the Americas, while Masterwork is one of China's leading postpress suppliers for packaging. The closer ties are set to significantly strengthen this position in China - the world's largest packaging market - and in other regions, too.    Creating shared value and stepping up sales of Heidelberg products in China What's more, there are plans for closer collaboration focusing on the two companies' value chains. Heidelberg will continue to supply the dynamic markets in China and the rest of Asia from the site in Qingpu, near Shanghai, that it established back in 2006. As a result of the closer working relationship with Masterwork, it will also benefit from joint component manufacturing operations at the Masterwork site in Tianjin in the future. This will provide both companies with a whole host of possibilities for improving their efficiency.   About Masterwork Group:   https://mkmasterwork.com/en/   Next important date:   Heidelberg will be publishing its report on the third quarter of financial year 2018/2019 on February 7.   For additional details about the company and image material, please visit the Press Lounge of Heidelberger Druckmaschinen AG at www.heidelberg.com.   Heidelberg IR now on Twitter:   Link to the IR Twitter channel: https://twitter.com/Heidelberg_IR On Twitter under the name: @Heidelberg_IR   Further information: Heidelberger Druckmaschinen AG   Corporate Public Relations Thomas Fichtl Phone: [phone] Fax: [phone] E-mail: [e-mail]   Investor Relations Robin Karpp Phone: [phone] Fax: [phone] E-mail: [e-mail]   Important note:   This press release contains forward-looking statements based on assumptions and estimations by the Management Board of Heidelberger Druckmaschinen Aktiengesellschaft. Even though the Management Board is of the opinion that those assumptions and estimations are realistic, the actual future development and results may deviate substantially from these forward-looking statements due to various factors, such as changes in the macro-economic situation, in the exchange rates, in the interest rates, and in the print media industry. Heidelberger Druckmaschinen Aktiengesellschaft gives no warranty and does not assume liability for any damages in case the future development and the projected results do not correspond with the forward-looking statements contained in this press release.     23-Jan-2019 CET/CEST The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de

Language:	English
Company:	Heidelberger Druckmaschinen AG
	Kurfürsten-Anlage 52-60
	69115 Heidelberg
	Germany
Phone:	[phone]
Fax:	[phone]
E-mail:	[e-mail]
Internet:	www.heidelberg.com
ISIN:	DE0007314007
WKN:	731400
Indices:	SDAX
Listed:	Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange

End of Announcement	DGAP News Service

768689  23-Jan-2019 CET/CEST