Benefits of Making Business in Cape Verde | Buy & Sell Business

1. BENEFITS OF MAKING BUSINESS IN CAPE VERDE WWW.MERGERSCORP.COM

2. At MergersCorp M&A International we help our clients confidentially buy and sell privately held businesses, aligning the interests of all parties for mutual success and satisfaction. It is our goal to make the process of either buying a new business or selling your current business as smooth and efficient as possible. We know how important confidentiality is to our sellers and we treat it with the utmost importance. WWW.MERGERSCORP.COM

3. BENEFITS OF MAKING BUSINESS IN CAPE VERDE WWW.MERGERSCORP.COM

4. Country Overview Cape Verde, also called Cabo Verde, country comprising a group of islands that lie 385 miles (620 km) off the west coast of Africa. Praia, on Santiago, is the capital. Cabo Verde is named for the westernmost cape of Africa, Cape Verde (French: Cap Vert), which is located in nearby Senegal and is the nearest point on the continent. The largest port in the islands is located at Mindelo, on São Vicente. Its deepwater harbour accommodates sizable vessels and has been used as a fueling station since the 19th century. Cape Verde consists of nine inhabited islands, one uninhabited island, and various islets, located between 14°30′ and 17°30′ N and between 22°30′ and 25°30′ W. The archipelago is divided into the Barlavento (Windward) group to the north and the Sotavento (Leeward) group to the south.

5. Executive Summary The terrain of the Cape Verde islands varies from the geologically older, flatter islands in the east and the newer, more mountainous islands in the west. The eastern islands of Boa Vista, Maio, and Sal, for example, have been heavily eroded by the wind over time and are very sandy and flat. The overwhelming majority of the population of Cabo Verde is of mixed European and African descent and is often referred to as mestiço or Crioulo. Although Portuguese is the official language and is used in formal situations, Crioulo, one of the oldest of the Portuguese creole languages, is by far the most widely spoken. After independence, the government played a central role in Cabo Verde’s economy and created several state-owned businesses, which ultimately was a limiting factor in the country’s economic growth.

6. Introduction – Doing business in Cape Verde Cape Verde is ranked 131 among 190 economies in the ease of doing business, according to the latest World Bank annual ratings. The rank of Cape Verde deteriorated to 131 in 2018 from 127 in 2017. Ease of Doing Business in Cape Verde averaged 129.64 from 2008 until 2018, reaching an all time high of 147 in 2008 and a record low of 119 in 2011. Cape Verde offers business and investment opportunities in the following areas: light industry (fishery products, salt, food), utilities (water and energy), construction, fisheries, agriculture (coffee, wine, flowers, fruit), service industry (telecommunication and transport), tourism, infrastructure (privatisation of airline, airports, port management and shipyards)..

7. Conducting business in Cape Verde • commercial partnership • private limited company • public limited company • limited partnership or limited partnership with shares • cooperative The person wishing to establish the company must obtain a certificate from the commercial register which indicates that the proposed name can be used. The incorporation contract together with the agreed articles of association must be registered with the commercial register. A statement from a Cape Verdean bank confirming the payment of the company's required capital should be attached to the incorporation contract. The following commercial entities exist in Cape Verde:

8. Taxation in Cape Verde In Cape Verde, the sales tax rate is a tax charged to consumers based on the purchase price of certain goods and services. The benchmark we use for the sales tax rate refers to the highest rate. Cabo Verde's CIT, called Imposto sobre o Rendimento das Pessoas Colectivas, is levied both on profits obtained within the Cabo Verdean territory and those obtained outside by resident companies (worldwide principle). Non-resident companies with a permanent establishment (PE) in Cabo Verde are also subject to CIT on Cabo Verdean-source income attributable to the PE.

9. Trade Cape Verde is the 184th largest export economy in the world. In 2017, Cape Verde exported $101M and imported $843M, resulting in a negative trade balance of $741M. In 2017 the GDP of Cape Verde was $1.77B and its GDP per capita was $6.9k. The top exports of Cape Verde are Processed Fish ($37.8M), Non-fillet Frozen Fish ($19.9M), Planes, Helicopters, and/or Spacecraft ($5.86M), Molluscs ($5.8M) and Fish Fillets ($3.87M), using the 1992 revision of the HS (Harmonized System) classification. Its top imports are Refined Petroleum ($69.7M), Planes, Helicopters, and/or Spacecraft ($27.6M), Rice ($20.5M), Cars ($20.1M) and Cement ($18.5M).

10. Banking in Cape Verde The Bank of Cape Verde (Portuguese: Banco de Cabo Verde) is Cape Verde's central bank. Its headquarter is located on Avenida Amílcar Cabral, in the national capital of Praia on the island of Santiago. Its current governor is João António Pinto Coelho Serra, who is in office since December 2014. The Bank of Cape Verde (Portuguese: Banco de Cabo Verde) is Cape Verde's central bank. Its headquarter is located on Avenida Amílcar Cabral, in the national capital of Praia on the island of Santiago. Its current governor is João António Pinto Coelho Serra, who is in office since December 2014.

11. Our M&A Process NEGOTIATION & CLOSE POST MERGER INTEGRATION (PMI) INTEGRATION (PMI) POST MERGER TARGET APPRAISAL APPROACH DUE DILIGENCE Key Areas  Target & market analysis;  Initial assessment of synergies & value drivers;  Indicative valuation;  Go or No-Go decision;  Preparation of transaction documents (NDA – Non- disclosure Agreement/LOI- Letter of Intent);  Select Transaction team;  Appoint advisors;  Consider funding ability.  Initial approach letter;  Signing of NDA;  Prepare & share initial information requests;  Formulation of LOI (Letter of Intent) & possible negotiations;  Initial meeting and Q&A;  Circulate information on the Target to the Transaction team.  Set scope of due diligence;  Set up VDR (virtual data room);  Coordinating of due diligence, further meetings and Q&A sessions;  Consider points relevant to the Post-Merger (PMI) phase;  Revisit indicative valuation & prepare detailed valuation based on due diligence findings;  SPA negotiations with the seller;  Development of final structure (share/asset deal) and final valuation;  Approvals;  Signing of SPA & Close.  Consider the extent of integration;  Development of 100 Day PMI Plan;  Consider short & long term objectives;  Estimate requirements to capture synergies;  Determine resource needs & optimal allocation. Parties Involved  CFO;  Head of M&A;  Accountants;  Corporate finance advisors;  Consultants.  Senior management;  CEO, CFO, CTO;  Strategy director;  Head of M&A;  Head of Business Development;  Consultants.  Company general counsel;  Lawyers;  Senior management.  Company general counsel;  Lawyers;  Senior management/HR. 11 © Midaxo 2018 www.midaxo.com

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13. MergersCorp.com The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. Member firms of the MergersCorp network of independent firms are affiliated with MergersCorp International. MergersCorp International provides no client services. No member firm has any authority to obligate or bind MergersCorp International or any other member firm vis-à-vis third parties, nor does MergersCorp International have any such authority to obligate or bind any member firm. Copyright © 2020 MergersCorp International. All rights reserved. 13 © Midaxo 2018 www.midaxo.com