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Acquisition of Liberty Surf:
building the leading pan-European
internet network company
Presentation to analysts
8 January 2001
Content
Strategic vision
Benefits of the transaction
Overview of the Enlarged Company
Overview of Liberty Surf
Overview of Tiscali
Transaction highlights
1
Strategic vision
The European IP interconnected network: new telco and new media
NEW TELCO
Voice
Access
IP based
interconnected network
Internet
B2B
Web Portal
Audio/Video
Streaming
Advertising and
e-commerce
NEW MEDIA
2
Strategic vision
Reach a leading position in all key European countries
Organic
growth in
subscribers
Triple digit growth
1999-2000 in many
Tiscali country
operations
Aggregating
small/medium
established players in
each country
Nikoma (Germany), Linkline
(Belgium), Datacomm
(Switzerland), Interweb (Belgium),
AddCom (Germany)
Consolidating
major
independents
World Online, Liberty Surf
3
Benefits of the transaction
Rationale
 Bolsters position as the pan-European internet
Market position


communications company
Strong No.2 position in France
Strengthen No.2 position in Europe, reduce gap
 Scale maximises network economics
 More attractive as a distribution vehicle for content
Critical mass
Portal offering

providers
“Must-buy” network for advertisers and e-commerce
partners
 Full range of innovative services
 Wider and deeper content offer
 Benefits from cross dissemination of content, applications
and skills
Costs savings
 Combination with Tiscali’s French operations
 Overheads restructuring
 Elimination of indirect costs outside of France
4
Overview of the Enlarged Company
Excellent pan-European presence
The only truly
pan-European Internet
operator
Top 3 positions in 7
countries
Largest pan-European
subscriber base with
10.7m registered
subscribers (4.9m active)
5
Overview of Enlarged Company
Acquisition of the No.2 player in France
 Strong presence in a strategic market
 population of 59 million and internet penetration below European average
 high projected growth (internet users’ expected CAGR until 2003: +42%)
Source: IDC - 2000
French portal ranking
1.6
3.5
1.4
3.0
1.2
Unique users (m)
Active Subscribers (m)
French ISP ranking
1.0
0.8
0.6
0.7
0.4
2.5
2.0
1.5
1.8
1.0
0.5
0.2
0.2
0.3
0.0
0.0
Wanadoo
Tiscali
Aol
Club Internet
Free.fr
Wanadoo
Tiscali
Yahoo!
Proxad
Terra Lycos
Source: NetRatings - November 2000
6
Overview of the Enlarged Company
Consolidation of No.2 position in Europe
 Leading market positions in
European ISP ranking as at 30/09/00
Italy, France, Belgium,
Netherlands, Denmark, Czech
Republic and South Africa
subscribers are in markets
where the Enlarged Company
has market leading positions
7
6
Active users (m)
 In total over 60% of
8
4.7
5
0.9
4
3
2
3.8
1
0
 Strong platform for growth
across the major European
economies of the United
Kingdom, Germany, Spain,
Switzerland and Scandinavia
T-Online
Tiscali
Wanadoo
Aol
Source: Company reports and press releases as at 30/09/00
Note: Wanadoo’s subscriber base includes Freeserve’s 2m active
subscribers
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Overview of the Enlarged Company
Pro forma data
(€m)
Tiscali
Liberty Surf
Pro forma
combined
Revenue (9 months to 30/09/00)
274
38
312
Revenue (6 months to 30/06/00)
165
23
188
EBITDA (6 months to 30/06/00)
(196)
(65)
(261)
Net cash (as at 30/06/00)
1,578
359
1937
Subscribers (as at 30/09/00)
- registered
- active
6.8m
3.8m
2.4m
0.7m
9.2m
4.5m
 Targeting EBITDA positive during H2 2001
Note: Pro forma data are unaudited
8
Overview of the Enlarged Company
Synergies and savings
France
 Approximately €80m of revenue
synergies and cost savings in 2001
 The Enlarged Company will benefit:
 an increase in advertising (60% of the


increase) and B2B (40%) revenues
a reduction of interconnection (12%
of the reduction), site production &
management (12%), marketing
(37%), technical (12%), call center
(4%) and G&A (23%) budgeted costs
a lower level of capital expenditures
(€
10m)
Foreign subsidiaries
 Approximately €10m of revenue
synergies and cost savings in 2001
arising from:
 the integration with actual Tiscali’s
businesses in UK, Spain, Sweden
and Norway
 the exploiting of portal business in
Spain (Hispavista)
+€
80m at EBITDA level in 2001, net of one off integration cash costs,
most of them recurring
+ net cash savings of approximately €550–600 million in 2001-2002
arising from the transaction with World Online
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Overview of the Enlarged Company
Shareholding assuming full acceptance of the Offer
Liberty Surf
public shareholders
2.9%
Tiscali
public shareholders
36.5%
Kingfisher
3.6%
Europ@web
3.6%
Renato Soru
31.6%
Sandoz
Foundation
17.8%
Reggeborgh
4.0%
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Overview of Liberty Surf
Market position




No.2 ISP in France with about 0.9m active subscribers (more than 2m registered )
No.3 portal in France (38.6% reach*)
Operations established in the UK (ISP, portal) and Spain (portal)
More than 3m registered subscribers in Europe
(*) NetRatings - November 2000
French portal ranking
1.6
3.5
1.4
3.0
1.2
1
Unique users (m)
Active subscribers (m)
French ISP ranking
0.9
0.8
0.6
0.4
2.5
1.8
2.0
1.5
1.0
0.5
0.2
0.0
0
Wanadoo
Liberty Surf
Aol
Club Internet
Free.fr
Wanadoo
Yahoo!
Liberty Surf
Proxad
Terra Lycos
Source: NetRatings - November 2000
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Overview of Liberty Surf
Web properties
12
Overview of Tiscali
Market position




No.3 ISP in Europe with about 4.0 m active subscribers (about 7.7 m registered)
Leading ISP position in 7 countries
Rapidly expanding European subscriber base
Strong portal reach in Italy
European ISP ranking as at 30/09/00
8
9
7
8
7
Registered users (m)
6
Active users (m)
Internet subscriber growth
5
3.8
4
3
2
6
CAGR 80%
quarter on quarter
5
4
7.7
3
2
1
1
0
0
T-Online
Wanadoo
Tiscali
Aol
Source: Company reports and press releases as at 30/09/00
1.8
0.4
Q3 99
2.3
2.6
Q2 00
Q3 00
0.9
Q4 99
Q1 00
Q4 00
Note: Include organic and external growth
13
Overview of Tiscali
Web properties and services
14
Tiscali progress since IPO
Benefits of European expansion
Price (€)
Bloomberg ISP Index
Sales/Share (€)
Cash/Share (€)
Active subs (m)
Countries with leading
market presence
4.6
13.6
68.0
70.5
+196%
+4%
0.209
0.638
1.356
4.224
+549%
+562%
0.5
4.0
1
7
Jan 2001
+731%
+6
IPO (Oct 1999)
15
Highlights of World Online Integration
Goals Achieved
 Created world-class management team
 Moved international headquarters to Milan
 Saving in headcount : 100 people for an aggregate annual saving of
approximately € 7 m
 Annual savings in G&A expenses for a total amount of € 5 m
 Swiss and Italian operations already merged for a total headcount reduction
of 100 people
 Netherlands: reduced headcount by 120
 Spain: consolidated management team
To be completed in Q1 2001
 German operations to be centralized in Frankfurt, Hamburg closed
 Merger of Belgian operations
 France: merging network and ISP companies
16
Transaction structure
Offer terms
 For each Liberty Surf share:
 0.365 Tiscali shares
 €2.13 in cash
 Acquisition of the 72.9% of Liberty Surf shares owned by
Structure

Europ@web and Kingfisher in equal part
Public offering for the remaining 27.1% of Liberty Surf
shares on the same conditions applied to the two main
shareholders
 Both Europ@web and Kingfisher have undertaken not to
Lock-up
dispose of the Tiscali shares
 for a period of 3 months days after closing in respect of
one third of their respective entitlements,
 until 7th September 2001 for an additional one third
portion, and
 until 9 months days after closing in respect of the
remainder
17
Transaction timetable
8 January
Announcement
As soon as
Text
possible
Text
Prospectus filed and Offer period starts
Late February
Tiscali EGM to approve capital increase
By the end of
Text
Q1 01
Text
Closing and settlement
18
Q&A
19
Disclaimer
These materials relate to the Offer and are not an extension of a tender offer in the United
States or to any US Person for any class of equity securities in Liberty Surf. The Offer will be
made by means of a Prospectus to be distributed to the Liberty Surf shareholders. Any
decisions regarding the Offer should only be made on the basis of such Prospectus.
None of the securities to be offered as consideration will be registered under the United
States Securities Act of 1933, as amended (the “Act”). Accordingly, such securities may not
be offered, sold or delivered in the United States or to US Persons, unless an exemption from
the registration requirements of the Act is available.
These materials do not constitute an offer of Tiscali Shares or an offer for Liberty Surf Shares.
Not for release, publication or distribution, in whole or in part, in or into United States,
Canada, Australia, Japan or Germany.
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