Execution of a Material Agreement

Grupo de Inversiones Suramericana S.A. (hereinafter "Grupo Sura" or the "Company") hereby informs the market that a series of documents (the "Agreements") were signed today, these consisting of a framework agreement and  attached documents that regulate in detail the different aspects of a transaction (the "Transaction") between Grupo SURA, JGDB Holding S.A.S. ("JGDB”), Nugil S.A.S., ("Nugil"), International Capital Holding L.L.C. Grupo Nutresa S.A. (“Grupo Nutresa”) and Grupo Argos S.A. (“Grupo Argos”), collectively the parties (the “Parties”), pursuant to the Memorandum of Understanding ("MOU") that was signed and announced to the market on May 24.

These Agreements set forth the terms and conditions for entering into a series of transactions that, once the pertinent corporate and regulatory authorizations are obtained, shall result in JGDB, Nugil and IHC becoming the majority and controlling shareholders holding at least an 87% stake in the share capital belonging to Grupo Nutresa S.A., after having spun off the investment that said Company currently has in Grupo SURA and Grupo Argos.

For the purposes of this relevant information, we shall call that company Nutresa Alimentos. On the other hand, the company resulting from the spin-off, which shall hold the shares that Grupo Nutresa S.A. currently holds in Grupo Argos and Grupo SURA, will be called, for illustrative purposes, Nueva Sociedad Portafolio.

In turn, JGDB, Nugil and IHC shall cease to be shareholders of Grupo SURA; likewise, Grupo SURA and Grupo Argos shall cease to be shareholders of Nutresa Alimentos.

Nutresa Alimentos shall not hold shares in Grupo Argos or Grupo SURA, since, as mentioned above, these will remain in the equity of Nueva Sociedad Portafolio.

The main activities and transactions required for the implementation of these Agreements are listed below:

  • The Parties shall obtain the corresponding corporate and regulatory authorizations for implementing these Agreements.
  • Grupo Nutresa, in order to segregate its business into Nutresa Alimentos and Nueva Sociedad Portafolio, shall call for an extraordinary Shareholders’ Meeting at which the approval of a symmetrical spin-off will be submitted for their consideration.

The symmetrical spin-off means that for each Grupo Nutresa share, each shareholder will hold one share of Nutresa Alimentos and shall receive one share of Nueva Sociedad Portafolio.

Both companies will be listed on the Colombian Stock Exchange.

  • Upon the approval of Grupo Nutresa’s Shareholders’ Meeting, the following contributions shall be made to a trust (the “Trust”), that shall be set up and operate in accordance with the provisions laid out in the Basic Legal Circular governing trust arrangements as issued by the Colombian Superintendency of Finance: 
    • Grupo SURA shall deliver the shares it owns in Grupo Nutresa.
    • Grupo Argos shall deliver the shares it owns in Grupo Nutresa.
    • Nugil, JGDB and IHC shall deliver the shares they own in Grupo SURA.
  • Once Grupo Nutresa's spin-off is duly formalized, Nugil will deliver the shares they received in Nueva Sociedad Portafolio to the Trust.
  • Grupo SURA and Grupo Argos shall then jointly make, in the proportion of 78% and 22%, respectively, a tender offer addressed to all shareholders of Nutresa Alimentos in which they may voluntarily participate and choose between:

(a) selling their shares in Nutresa Alimentos at a price of USD 12 per share payable in accordance with the conditions to be defined in the corresponding tender offer statement, and/or

(b) exchanging their shares in Nutresa Alimentos, receiving shares in Grupo SURA and Nueva Sociedad Portafolio (set up with Grupo SURA’s and Grupo Argos’ shares). The aforementioned, under the same terms Grupo SURA and Grupo Argos agreed to negotiate with Nugil, JGDB and IHC as stipulated in the Agreements. The terms and conditions for the exchange shall be published in the tender offer statement.

Once this tender offer is concluded, Grupo SURA and Grupo Argos (the "Offerors") shall deliver to the Trust the acquired shares for up to 10.1%.

The tender offer acceptances received in excess of 10.1% and up to 23.1% shall be paid by Grupo SURA and Grupo Argos to the shareholders taking part in this tender offer and such value will be reimbursed, at the same price, by IHC to the Offerors.

  • Subsequently, the Trust shall reimburse the contributions made (by Grupo SURA, Grupo Argos, Nugil, JGDB and IHC), once the conditions precedent are met, as agreed between the Parties, resulting in the exchange of shares, with which:

(a) JGDB, Nugil and IHC shall become the controlling shareholders of Nutresa Alimentos, and

(b) Grupo SURA and Grupo Argos shall receive the shares of Nueva Sociedad Portafolio and the shares of Grupo SURA that were owned by Nugil, JGDB and IHC.

  • Subsequently, Nueva Sociedad Portafolio shall be liquidated with the following effects:

(a) Grupo SURA shall receive its own shares and Grupo Argos’ shares.

(b) Grupo Argos shall receive its own shares and Grupo SURA’s shares.

(c) The other shareholders of Nueva Sociedad Portafolio shall receive shares in Grupo SURA and Grupo Argos.

With the prior authorization of the Colombian Superintendency of Finance and in order to guarantee compliance with applicable rules and regulations at all times, a portion of the restituted shares that Grupo SURA and Grupo Argos are to receive will be temporarily delivered to independent trusts. The shares deposited therein shall not have any voting rights while these trusts exist.