SGL Group acquires BMW Group's minority interest in the joint venture SGL Automotive Carbon Fibers (SGL ACF)

SGL Carbon SE will acquire the 49% stake in stages, becoming the sole owner of SGL ACF

Purchase is in line with the strategy of supplying every step of the carbon fiber value chain from a single source

Cooperation with BMW Group on the supply of carbon fiber materials will continue

No impact on BMW AGs shareholding in SGL Carbon SE

Wiesbaden/Munich, November 24, 2017. SGL Carbon SE is acquiring BMW Groups 49% equity investment in the joint ventures SGL Automotive Carbon Fibers GmbH & Co. KG (Germany) and SGL Automotive Carbon Fibers LLC (US) together referred to as SGL ACF. An agreement on this matter was signed by SGL Group and BMW Group today. Once the deal has been completed, SGL Group will be the sole owner of SGL ACF. As is customary, the transaction is subject to approval from the respective authorities.

We are proud of the pioneering work that we have carried out with BMW Group on lightweight construction for the automotive sector. The carbon fibers made at our plant in Moses Lake and the fabrics that are produced from them at the Wackersdorf site have proven very successful. It is now time to fully integrate this expertise into SGL Groups value chain, says J rgen K hler, Chief Executive Officer of SGL Group.

Carbon fibers and carbon fiber materials are at the core of SGL Groups corporate strategy. By acquiring SGL ACF now, SGL Group is forging ahead with its strategy to consolidate all key activities in the value chain from carbon fibers and materials to components within the SGL Group, giving it overall responsibility. As announced two weeks ago, BENTELER-SGL is being acquired for the same reason.

The changes in the shareholder structure of SGL ACF will not have any direct impact on its workforce, which currently totals around 450 employees.

BMW Group will continue to rely on lightweight construction and an intelligent mix of materials, with carbon remaining a significant component, explains Markus Duesmann, member of the Board of Management at BMW AG with responsibility for purchasing and supplier network. Carbon will also play an important role in the BMW iNEXT, which will set the benchmark for electric vehicles, autonomous driving, connectivity, and lightweight construction from 2021. SGL Group is and will remain a major supplier and strategic partner in this regard, adds Duesmann.

BMW Group has entered into an agreement with SGL Group to continue to work together on future projects involving the use of carbon.

The existing supply agreements for the continued procurement of carbon products from SGL ACF for the BMW i3, the BMW i8, and the BMW 7 series into the next decade are unaffected by the transaction. Likewise, BMW Groups CFRP-stacks production unit in Wackersdorf will not be affected. Furthermore, the transaction will not impact BMW AGs 18.3% shareholding in SGL Carbon SE. This equity investment is not up for disposal.

The agreement between SGL Group and BMW Group provides for the acquisition of the two SGL ACF companies in stages. In the first step, SGL Automotive Carbon Fibers GmbH & Co. KG (Germany) will be transferred to SGL Group. This transaction will probably be completed in January 2018. The second step will involve SGL Automotive Carbon Fibers LLC (US) being transferred to SGL Group, with this transaction expected to be completed by the end of 2020 at the latest.

The SGL ACF joint venture was founded in 2009 with the aim of establishing the use of carbon as a lightweight construction material in the automotive industry and securing the supply of carbon fibers and fabrics for BMW Group. Since then, SGL Group and BMW Group have created a leading technological position in the field of carbon fiber composites with their joint development activities and the construction of two plants. The possibility of SGL Group acquiring BMW Groups shares was already agreed as an option back when the joint venture was founded. Accordingly, 51% of the shares were allocated to SGL Group and 49% to BMW Group at that time.

SGL ACFs production activities take place in Moses Lake (Washington, US) and Wackersdorf (Bavaria, Germany). Moses Lake is the worlds most modern and environmentally friendly carbon fiber plant and produces specific carbon fibers for serial production applications. The acquisition gives SGL Group the opportunity to expand its activities at the site relating to fibers and composites for the North American market. At the Wackersdorf plant, carbon fibers are processed to create fabrics and non-wovens. BMW Group uses these to produce components, such as for the passenger cell of the i3 and i8, as well as individual parts for the 7 series. At the site, SGL ACF also operates equipment to recycle residual materials resulting from the production process, thereby making a valuable contribution to conserving resources and lowering costs in the carbon fiber reinforced plastics process chain. In 2016, SGL ACF generated sales revenue of around 90 million.

In the future, SGL ACF will be fully assigned to the Composites Fibers & Materials (CFM) business unit. This unit of SGL Group has strong development and production expertise in fibers especially acrylic fibers, oxidized fibers, and carbon fibers and fiber composites. In parallel, SGL Group is establishing a Lightweight and Application Center (LAC) in Meitingen (Bavaria, Germany). At the LAC, products and associated manufacturing processes are developed for lightweight components that are suitable for volume production. In the future, the former joint venture BENTELER-SGL will also belong to the CFM business unit. The company is one of the leading developers and large-scale producers of lightweight composite components (based on fiberglass and carbon fibers) for the automotive industry. At the start of November, SGL Group announced that it was acquiring the other 50% of this joint venture from

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