Bank of America Investment Banking Pitch Book
Introduction
Executive Summary
BofA Securities, Inc. ("BofA") appreciates the opportunity to meet with Sisecam Chemicals Resources LLC ("SCR") to discuss our views on a potential take
private of Sisecam Resources LP ("SIRE")
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MLP Market Backdrop
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MLPs across all sectors continue to struggle to attract new public investors and have experienced negative fund flows, resulting in
very limited access to equity capital
Small, low float MLPs have been more negatively impacted given lack of scale, trading liquidity and poor institutional interest
Even in the context of solid underlying business fundamentals and reasonably high payout ratios, MLPs broadly have experienced
increasingly high dividend yields. Consequently, several sponsors have opted to execute simplification transactions or take their
partnerships private
There have been 29 MLP take privates since the beginning of 2018, with very few sponsored MLPs currently remaining
BofA believes a take private of SIRE may be the best path forward for SCR for the following key reasons:
SIRE is an expensive source of capital - With its ~11% distribution yield, SIRE no longer serves the MLP's original purpose of
providing a low cost source of capital
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SIRE does not provide access to capital and likely will not in the future - There is no clear catalyst to restore access to MLP capital
markets as investor sentiment has permanently shifted away from the MLP model. Additionally, SIRE will struggle to attract MLP
investors with its average daily trading value of $290,000, de minimus trading activity, and lack of research analyst coverage
Opportunity to retain cash flows - SIRE costs SCR ~$11MM of cash flow per year through distributions to public unitholders and
public company costs, which could otherwise be reinvested into the business
Opportunity to simplify structure - A take private allows SCR to reduce management burden, simplify organizational structure,
eliminate public company expenses and increase flexibility to execute desired strategyView entire presentation