Exhibit 99.3
![]() | 21 October 2009 Important notice: The original document was prepared in Portuguese and this is just a free translation. In case of any difference or divergence between this version and the Portuguese one, the Portuguese version must prevail. Translations are not always precise given complexities of each language. There is no assurance as to the accuracy, exactness and reliability of the content of the English version of this report. [GRAPHIC OMITTED] Valuation Report to the Board of Directors of Gafisa S.A. Merger of shares with Construtora Tenda S.A. R ROTHSCHILD |
![]() | Disclaimer - --------------------------------------------------------------------------------------------------- Important notices In connection with the announced transaction between Gafisa S.A. ("Gafisa") and its 60% owned subsidiary Construtora Tenda S.A. ("Tenda", together with Gafisa, "Companies") ("Transaction"), as disclosed in the material fact dated 21 October 2009 ("Material Fact"), we were requested by Gafisa to prepare a valuation of the exchange ratio between shares of Tenda and Gafisa in the proposed merger of shares of Tenda into Gafisa ("Valuation"). The Transaction encompasses the merger of all outstanding shares of Tenda into Gafisa ("Merger of Tenda's Shares"). Gafisa's shares received by Tenda's shareholders will be traded on BM&FBOVESPA's Novo Mercado segment. According to the Material Fact, Gafisa's management believes that an adequate exchange ratio should range between 0.188 and 0.200 shares of Gafisa per one share of Tenda. This interval corresponds to the high and low average ratios between the closing share prices of Tenda and Gafisa in each of the various periods comprised between (a) the date of release of the Material Fact and the 30th day preceding the date of the Material Fact and (b) the date of release of the Material Fact and the 180th day preceding the date of the Material Fact. In order to prepare our valuation, as instructed by Gafisa, we based our analysis exclusively in information publicly available as of the date of the Valuation. Therefore, we, among other things, (i) reviewed certain financial and commercial information publicly available regarding the Transaction; (ii) reviewed certain audited financial statements, publicly available, of Gafisa, Tenda and other comparable companies in the real estate sector operating in Brazil ("Sector Companies"); (iii) analyzed the share price of Companies in the market; and (iv) analyzed comparable valuation metrics of the Companies and the Sector Companies. For purposes of preparing our Valuation, we did not undertake to perform an independent verification of any financial, legal, commercial or other information used, reviewed or considered by us for this work, and we assumed and trusted, with Gafisa's consent and without any independent investigations, the accuracy, content, truthfulness, consistency, completeness, sufficiency and integrality of the financial, accounting, legal and tax information available in public domain analyzed by us. In this sense, we based our valuation on such information, considering such information exact and complete in all its material aspects. We have also assumed that, according to Gafisa's statement, no relevant changes have occurred since the base date of this Valuation in connection with the assets, financial condition, result of the transactions, business or perspectives of the Companies and in this extent no material adverse effects have occurred with respect to Gafisa's business, financial and assets. We did not and will not assume herein any responsibility for the independent verification of said information or for conducting an independent verification or appraisal of any of the assets or liabilities (contingent or otherwise) of the Companies. As a result, we do not assume any responsibility related to the accuracy, truthfulness, integrality, consistency and sufficiency of the information which we based the Valuation upon. Moreover, we have not undertaken to conduct, and did not in fact conduct, any physical inspection of the properties, assets or premises of the Companies. GAFISA 1 ROTHSCHILD |
![]() | Disclaimer - --------------------------------------------------------------------------------------------------- Important notices (cont'd) The Valuation is based on the market, economic, monetary and other effective conditions existing as of the date of the Material Fact and on other public available information up to date, so that it is valid exclusively on this date, since future events and other developments may affect it. Therefore, although facts and events following the date Material Fact may affect this Valuation, we do not undertake to update, review or revoke it in view of any later developments or for any other reason. Neither Rothschild, nor any of its affiliates and representatives, undertake any responsibility or liability regarding these analysis. In addition, the results specified in the Valuation do not represent any opinion with respect to the value in which the shares of the Companies should trade. With respect to the preparation of the Valuation, Gafisa and its Board of Directors have not authorized us to solicit, nor have we solicited, any indication of interest from third parties to acquire, in whole or in part, the shares of any of the Companies. Accordingly, the results contained in the Valuation do not necessarily correspond to, and should not be construed as representative of, the prices at which the Companies could be sold to a third party on the date hereof or in the future. The preparation process of a financial analysis is a complex process involving several definitions of the most appropriate and relevant methods for its performance and the application of such methods to particular circumstances, and therefore, a financial analysis, should not be the subject matter of a partial analysis. Accordingly, Rothschild did not attribute any subjective value to any particular factor considered by it. To arrive at the conclusions presented in the Valuation, we followed a qualitative line of reasoning for the analyses and factors taken into consideration. Our final conclusion was based on the results of the complete analysis performed and evaluated as a whole, and this conclusion was not based solely on or related to any specific factors or methods involved in our analysis. We feel that our analysis should be considered in its entirety and therefore if parts of this analysis and specific factors are selected without considering the full context of the analysis and its conclusions, this can result in an incomplete understanding of the processes used to reach said conclusions. The results presented herein refer solely to the Transaction and do not extend to any other present or future matters or transactions regarding the Companies, the economic group to which they belong to or the sector in which they operate. Rothschild and its affiliates are constantly involved in rendering of financial analysis with respect to companies and their securities in connection with mergers and acquisitions, negotiated subscriptions, public biddings, secondary distributions of bonds, whether or not listed on stock exchanges, placement of private bonds and other transactions, as well as with other transactions involving estate and corporate matters. We have been engaged by Gafisa and will receive a fee upon delivery of this Valuation regardless of the successful conclusion or not of the Transaction. In addition, Gafisa has undertaken to reimburse for our out-of-pocket expenses as well as to indemnify us due to certain obligations which may arise in connection with our engagement. Moreover, we GAFISA 2 ROTHSCHILD |
![]() | Disclaimer - --------------------------------------------------------------------------------------------------- Important notices (cont'd) have not been requested and we have not rendered any advice regarding the structure, the price negotiation nor any other aspects of the Transaction, neither have we rendered other services apart from the delivery of this Valuation. We confirm that we have no interest, whether direct or indirect, in the Companies or in the Transaction, and to the best of our knowledge there are no other relevant circumstance that can typify a conflict of interest regarding our involvement in the Transaction. No further direction, limitation or difficulty was imposed on us by the controlling shareholders of the Companies or their officers, nor were any other acts performed by them, which could in any way have affected the access, use or knowledge on our part of any information, assets, documents or work methodologies that are relevant for the quality of the conclusions we have expressed in this document. You will also note that we are not an accounting firm and we did not render accounting or auditing services in connection with this Transaction, though we have used in our methodology some accounting analysis and principles. In arriving at the Valuation, we did not take into account nor did we evaluate (i) the tax effects arising from the Transaction; (ii) the impact of any commissions or expenses which may result from closing of the Transaction; (iii) the impact of potential synergies resulting from the Transaction; and (iv) the impact of eventual contingencies or losses of any kind of Gafisa or Tenda, which were not available in the public domain by the date of release of the Valuation; (v) the terms of the merger of shares of Tenda. Furthermore, the financial calculations contained in the Valuation may not always result in a precise sum due to rounding. We did not analyze the Transaction from a legal or any other standpoint and, therefore, we are not responsible (either by force of an agreement, civil liability provisions or otherwise) for such analysis. The presentation of this Valuation is for the exclusive use of the Board of Directors of Gafisa in considering the Transaction, as detailed above, and shall not be used for any other purposes, including but not limited to capital formation, nor shall it grant any rights or remedies to the Boards of Directors of the Companies or to any other shareholder, securities holder or creditor of the Companies. This document is not nor shall it be used as a recommendation to, as an opinion for, or as an advice to the shareholders of Gafisa or Tenda in relation to the Transaction. All shareholders shall conduct their own analysis of the Transaction, and such analysis shall be based on their own financial, tax and legal advisors. The Valuation is exclusively addressed to Gafisa and does not evaluate the underlying business decision by Gafisa to engage in the Transaction and does not constitute a recommendation to any of Gafisa and/or the holders of the respective Gafisa shares (including, but not limited to, as to how any such holder shall exercise its rights to vote or any other rights with respect thereto). We reserve the right to refuse any solicitation for presenting the Valuation to third persons other than Gafisa's officers and members of Board of Directors. GAFISA 3 ROTHSCHILD |
![]() | Contents - --------------------------------------------------------------------------------------------------- Sections -------------------------------------------------------------------------------------- 1 Introduction 5 -------------------------------------------------------------------------------------- 2 Valuation methodology 8 -------------------------------------------------------------------------------------- 3 Exchange ratio at market prices 13 -------------------------------------------------------------------------------------- 4 Trading multiples analysis 16 Appendices -------------------------------------------------------------------------------------- A Backup materials 19 GAFISA 4 ROTHSCHILD |
![]() | 1. Introduction - --------------------------------------------------------------------------------------------------- 1.1 Initial considerations o On October 21, 2009, the management of Gafisa S.A. ("Gafisa") announced its intention to present to its shareholders, until the end of the current year, a proposal for the merger, into Gafisa, of all of the shares of its subsidiary Construtora Tenda S.A. ("Tenda") currently outstanding ("Merger"). o According to Gafisa's management, an adequate exchange ratio should be between 0.188 and 0.200 shares of Gafisa per one share of Tenda ("Exchange Ratio"). - - These amounts correspond to the high and low average ratios between the closing shares price of Tenda and Gafisa in each of the various periods comprised between (a) the date of release of the Material Fact and the 30th day preceding the date of the Material Fact and (b) the date of release of the Material Fact and the 180th day preceding the date of the Material Fact. 0 N M Rothschild & Sons (Brasil) Ltda. ("Rothschild") was requested by Gafisa to prepare a valuation, based exclusively on information publicly available, of the exchange ratio between the shares of Tenda and Gafisa in connection with the proposed merger of Tenda's shares into Gafisa ("Valuation") GAFISA 5 ROTHSCHILD |
![]() | 1. Introduction - --------------------------------------------------------------------------------------------------- 1.2 Transaction overview [GRAPHIC OMITTED] Current structure Merger of Tenda's shares into Gafisa Final structure Gafisa Gafisa Gafisa Tenda minority shareholders shareholders shareholders shareholders [GRAPHIC OMITTED] Minority Minority shareholders shareholders 100% 60% 40% 60% 40% o Gafisa currently owns 60% of Tenda's total and voting capital o The remaining shares of Tenda are outstanding in the market o All shares of Tenda outstanding are merged into Gafisa o According to the Material Fact, the exchange ratio could range between 0.188 and 0.200 o After the Merger, Gafisa will own 100% of shares of Tenda o New shares issued by Gafisa to Tenda's shareholders will be identical to the ones owned by Gafisa's current shareholders GAFISA 6 ROTHSCHILD |
![]() | 1. Introduction - --------------------------------------------------------------------------------------------------- 1.3 Summary valuation based on publicly available information Exchange ratio between Tenda and Gafisa shares(1,2,3) Announced exchange ratio range 0.188 - 0.200 Trading price Average 0.188 0.202 30 trading days 1 trading days Trading price Weighted average 0.189 0.210 45 trading days 120 trading days Multiples based on Net Asset Value (4) 0.198 0.212 30 trading days 120 trading days Multiples based on Adjusted BV (4) 0.212 0.226 30 trading days 120 trading days Multiples based on Book Value (4) 0.2420.259 30 trading days120 trading days 0.100 0.120 0.140 0.160 0.180 0.200 0.220 0.240 0.260 0.280 0.300 Notes 1 Exchange ratio of the share swap between Tenda and Gafisa was calculated by the division of Tenda's value per share per Gafisa's value per share, considering to both their respective number of shares fully diluted and net of treasury shares as presented in the appendix 2 All the metrics consider the average share price each trading day up to October 21, 2009 3 Ranges presented consider exchange ratio max and min to each valuation metric selected between observations in the periods of 1, 5, 15, 30, 45, 60, 90 or 120 trading days 4 Sensitivity of the analysis per multiples considering different periods mentioned above GAFISA 7 ROTHSCHILD |
![]() | 2. Valuation methodology - --------------------------------------------------------------------------------------------------- 2.1 Summary of valuation methodologies based on publicly available information Stock price performance Methodology o Analyze the historical stock prices of Gafisa and Tenda o Calculate the market value of Gafisa and Tenda based on the observed average stock prices in different periods o Calculate the exchange ratio between Gafisa and Tenda's stock Conclusions o Represents a good parameterof the exchange ratio between the two companies - - Future market expectations already built in the stocks' current price - - Both stocks are liquid and Gafisa has diluted ownership as per CVM's criteria of diluted ownership and liquidity Real estate sector multiples o Identify listed companies on Gafisa and Tenda's market segment with relevant size and liquidity Calculate the market multiples based on publicly available information o Evaluate the consistent multiples for Gafisa and Tenda's market value calculations o Calculate the exchange ratio between Gafisa and Tenda's stock through these multiples o The market multiples analysis has some downsides: - - Difficulty in identifying comparable multiples among the various companies in the sector - - Different accounting methods could lead to different multiples values - - Hard to determine which companies truly are comparable to Gafisa and Tenda o However, market multiples provides a good reference to analyze the results achieved through the stock price performance method [GRAPHIC OMITTED] Exchange ratio [GRAPHIC OMITTED] GAFISA 8 ROTHSCHILD |
![]() | 2. Valuation methodology - --------------------------------------------------------------------------------------------------- 2.2 Considerations about the period of analysis of share prices 1 Analyzing similar transactions we can infer that there is no consensus regarding the ideal period to be used to value a company at market prices o The period to be used in the valuation is a prerogative, with the appropriate justifications, of the companies' management 2 The table below summarizes some illustrative deals that based the exchange ratio definition on different time periods Transaction Announcement date Selected period Telesp and TelespPar 11/03/99 60 trading days Caemi and CVRD 03/15/06 90 days BMC and Bradesco 08/08/07 15 days BESC and Banco do Brasil 10/05/07 90 days Bovespa Holding and Nova Bolsa 04/17/08 30 days Unibanco and Itau 11/03/08 45 trading days GAFISA 9 ROTHSCHILD |
![]() | 2. Valuation methodology - --------------------------------------------------------------------------------------------------- 2.3 Considerations about the trading multiples analysis Types of multiples o Balance sheet indicators o Given that this report is based on publicly available information, all the multiples were based on most recent financial statements available at 10/21/09 (i.e. 06/30/09) Balance sheet multiples analyzed o Book value o Adjusted book value - - Adjustments were made to incorporate in the analysis the net value of results to be recognized, which are not currently registered in the balance sheet but are a relevant portion of the business o Net asset value ("NAV") - - Analysis of assets and liabilities that impact cash flow generation, including results to be recognized Income statement multiples analyzed o We did not include multiples based on income statement figures (e.g.: revenues, EBITDA, net income) since Tenda went through a restructuring during the last twelve months that does not allow for a comparison of the figures with Sector Companies GAFISA 10 ROTHSCHILD |
![]() | 2. Valuation methodology - --------------------------------------------------------------------------------------------------- 2.3 Considerations about the trading multiples analysis (cont'd) Sum of the parts Methodology o Gafisa and Tenda value calculated based on the value allocated to each segment of the real estate sector - - Mid/High income - - Low income o Multiple based on the Net Asset Value of the companies ("NAV") Calculation of the value of Gafisa and Tenda o Tenda: multiple of real estate companies focused on low-income segment applied to company's Net Asset Value o Gafisa: sum of (i) multiple of real estate companies focused on high/mid income segment applied to Gafisa's Net Asset Value excluding the consolidation of Tenda and (ii) 60% of Tenda's value, as calculated above Multiples of Book Value o Comparable multiple calculated dividing (i) the market value of each company by (ii) their book value o Two metrics of book value - - Book value as published by the companies in their latest financial statements - - Adjusted book value as the Book value plus results to be recognized ("REF") o Tenda: multiple of real estate companies focused on low-income segment applied to company's book value o Gafisa: use of the multiple of all sample of real estate companies over company's book value, given that its current book value reflects operations in high, mid and low income segments Multiples based on publicly available information GAFISA 11 ROTHSCHILD |
![]() | 2. Valuation methodology - --------------------------------------------------------------------------------------------------- 2.4 Selection methodology of the sample of comparable real estate companies for the purpose of the multiple analysis The selection of companies in the real estate industry for the multiples valuation was based on 2 main criterias o Market value of the companies o Market segments in which each company operates 1 Market value of the companies o Selection targeted companies with market cap above R$1.0 billion as of 10/21/09 2 Market segments in which each company operates o The selection covered only companies that operate in Brazil and are focused on the segments of (i) mid/high income and (ii) low income - - After the merger of Tenda and Fit, Gafisa started to have relevant exposure to both segments. Becasuse of that, an analysis of Gafisa's value must consolidate companies of both segments [GRAPHIC OMITTED] Selected companies Low income: MRV (Mkt cap: R$5.9 bn,100% low income); PDG (Mkt cap: R$5.9 bn, 83% low income); Tenda (Mkt cap: R$2.5 bn,100% low income) [GRAPHIC OMITTED] Mid/High income: Cyrela (Mkt cap: R$10.6 bn); Rossi (Mkt cap: R$3.5bn); Brookfield (Mkt cap: R$3.0bn); Tecnisa (Mkt cap: R$1.5bn) ; Even (Mkt cap: R$1.3bn); EZ Tec (Mkt cap: R$1.1bn) Notes 1 Market values at 10/21/09, calculated by the daily average price 2 Despite qualifying for selection, Agre was not included in the analysis because it is in the middle of a restructuring process and the merger of Klabin Segall and Abyara GAFISA 12 ROTHSCHILD |
![]() | 3. Exchange ratio at market prices - --------------------------------------------------------------------------------------------------- 3.1 Weighted average price of Gafisa's and Tenda's shares Gafisa price per share since October 22nd, 2008 210 35.00 180 30.00 [GRAPHIC OMITTED][GRAPHIC OMITTED] (Averageprice R$/share) 150 25.00 120 Weighted average price(2): R$19.31/share 20.00 90 15.00 60 10.00 30 5.00 0 0.00 out-08 dez-08 fev-09 abr-09 jun-09 ago-09 out-09 Volume (R$m) Price (R$/share) Source Economatica Notes 1 Considering daily average prices, calculated as the daily trading volume divided by the number of shares traded every day, from 10/22/08 to 10/21/09 2 Daily average prices weighted by the daily traded volume in the period Tenda price per share since October 22nd, 2008 70 7.00 60 6.00 [GRAPHIC OMITTED][GRAPHIC OMITTED] 50 Weighted average price(2): R$4.19/share 5.00 40 4.00 30 (Averageprice R$/share) 3.00 20 2.00 10 1.00 0 0.00 out-08 dez-08 fev-09 abr-09 jun-09 ago-09 out-09 Volume (R$m) Price (R$/share) Source Economatica Notes 1 Considering daily average prices, calculated as the daily trading volume divided by the number of shares traded every day, from 10/22/08 to 10/21/09 2 Daily average prices weighted by the daily traded volume in the period GAFISA 13 ROTHSCHILD |
![]() | 3. Exchange ratio at market prices - --------------------------------------------------------------------------------------------------- 3.2 Changes in the exchange ratio between Tenda and Gafisa [GRAPHIC OMITTED][GRAPHIC OMITTED] Tenda price per share over Gafisa price per share over the last 12 months 0.300 0.250 0.200 0.150 0.100 0.050 0.000 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Moving average 30 days Moving average 60 days Moving average 90 days Daily average price Source Economatica Note 1 Considering the moving average of daily average prices, calculated as the daily trading volume divided by the number of shares traded every day, from 10/22/2008 to 10/21/2009, according to the methodology described in the CVM instructions No.361 of 2002 and No.436 of 2006 GAFISA 14 ROTHSCHILD |
![]() | 3. Exchange ratio at market prices - --------------------------------------------------------------------------------------------------- 3.3 Exchange ratios at market prices Implied exchange ratios at market prices - Average Average price of GFSA3 Average price of TEND3 Trading days up to 10/21/09 (R$/share) up to 10/21/09 (R$/share) Exchange ratio ----------------------------------------------------------------------------------------- Max: 0.202 1 30.63 6.19 0.202 Min: 0.188 5 30.69 5.81 0.189 15 28.63 5.43 0.190 30 28.30 5.32 0.188 45 27.84 5.25 0.188 60 26.73 5.06 0.189 90 23.68 4.63 0.196 120 22.32 4.38 0.196 ----------------------------------------------------------------------------------------- Implied exchange ratios at market prices - Weighted average(1) Weighted average price of Weighted average price of GFSA3 up to 10/21/09 TEND3 up to 10/21/09 Trading days (R$/share) (R$/share) Exchange ratio ----------------------------------------------------------------------------------------- Max: 0.210 1 30.63 6.19 0.202 Min: 0.189 5 30.65 5.83 0.190 15 28.45 5.56 0.195 30 28.25 5.42 0.192 45 27.93 5.28 0.189 60 27.05 5.16 0.191 90 24.29 4.96 0.204 120 22.70 4.76 0.210 -------------------------------------------------------------------------------------- Source Economatica Note 1 Weighted by the daily trading volume GAFISA 15 ROTHSCHILD |
![]() | 4. Trading multiples analysis - --------------------------------------------------------------------------------------------------- 4.1 Trading multiples based on Net Asset Value SectorTabletitlecompanies Price per Market Net Asset share(1) value Value(2) Company (R$/acao) (R$m) (R$m)P/NAV - -------------------- --------------- ------------- Gafisa 28.30 3,777 2,9791.27x Mid/High income Cyrela(3) 24.49 10,186 4,3662.33x Rossi(3) 13.60 3,608 2,6381.37x Brookfield(3) 7.58 3,224 2,4571.31x EZTEC 7.44 1,066 1,0191.05x Even 6.79 1,215 1,1831.03x Tecnisa 9.80 1,433 1,2591.14x ------------------------------------- Average 1.37x Median 1.23x ------------------------------------- Low income MRV 34.46 5,605 2,6962.08x PDG(3) 14.70 5,426 2,8421.91x Tenda 5.32 2,155 1,4821.45x ------------------------------------- Average 1.81x Median 1.91x ------------------------------------- ------------------------------------- Total average 1.49x Total median 1.34x - ---------------------------------------------------------------------- Notes 1 30 trading days average price up to 10/21/2009 2 As of 06/30/2009 3 Adjusted for public offerings after 06/30/2009 [GRAPHIC OMITTED] CalculationTabletitle of the value of Tenda and Gafisa Calculation of the value of Tenda Average P/NAV of low income real estate companies 1.81x Tenda Net Asset Value as of 06/30/09 (R$m)(1) 1,482 Tenda value according to valuation based on 2,688 P/NAV multiple (R$m) Fully diluted number of Tenda shares (million)(2) 405 Price per share of Tenda according to valuation 6.64 based on P/NAV multiple (R$/share) Calculation of the value of Gafisa - ----------------------------------------------------- Average P/NAV of middle/high income real estate companies 1.37x Gafisa Net Asset Value (ex-Tenda) as of 06/30/09 (R$m)(1) 2,089 60% of Tenda value according to valuation based on 1,613 P/NAV multiple (R$m) Gafisa value according to valuation based on 4,477 P/NAV multiple (R$m) Fully diluted number of Gafisa shares (million)(2) 133 Price per share of Gafisa according to valuation 33.55 based on P/NAV multiple (R$/share) Implied exchange ratio according to valuation 0.198 based on P/NAV multiple Note 1 NAV calculation detailed in appendix 2 Fully diluted number of shares calculation detailed in appendix GAFISA 16 ROTHSCHILD |
![]() | 4. Trading multiples analysis - --------------------------------------------------------------------------------------------------- 4.2 Trading multiples based on Adjusted Book Value For Gafisa we applied the average Adjusted Book Value multiple of the entire sample given the difficulty of splitting Gafisa's book value between high/mid and low income operations Sector companies Share Market Adjusted Book price(1) value Value(2) Adj. Company (R$/share) (R$m) (R$m) P/BV -------------------- ------------- ------------- --------- Gafisa 28.30 3,777 2,841 1.33x Mid/High income Cyrela(3) 24.49 10,186 4,845 2.10x Rossi(3) 13.60 3,608 2,717 1.33x Brookfield(3) 7.58 3,224 2,717 1.19x EZTEC 7.44 1,066 1,027 1.04x Even 6.79 1,215 1,207 1.01x Tecnisa 9.80 1,433 1,318 1.09x ------------------------------------- Average 1.29x Median 1.14x ------------------------------------- Low income MRV 34.46 5,605 2,788 2.01x PDG(3) 14.70 5,426 3,213 1.69x Tenda 5.32 2,155 1,520 1.42x ------------------------------------- Average 1.71x Median 1.69x ------------------------------------- ------------------------------------- Total average 1.42x Total median 1.33x ---------------------------------------------------------------------- Notes 1 30 trading days average price up to 10/21/2009 2 As of 06/30/2009 3 Adjusted for public offerings after 06/30/2009 CalculationTabletitle of the value of Tenda and Gafisa Calculation of the value of Tenda Average adjusted P/BV of low income real estate companies 1.71x Tenda adjusted Book Value as of 06/30/09 (R$m) 1,520 Tenda value according to valuation based on 2,593 Adjusted P/BV multiple (R$m) Fully diluted number of Tenda shares (million)(1) 405 Price per share of Tenda according to valuation 6.40 based on Adjusted P/BV multiple (R$/share) Calculation of the value of Gafisa - ----------------------------------------------------- Total average adjusted P/BV of real estate companies 1.42x Gafisa adjusted Book Value as of 06/30/09 (R$m) 2,841 Gafisa value according to valuation based on 4,033 Adjusted P/BV multiple (R$m) Fully diluted number of Gafisa shares (million)(1) 133 Price per share of Gafisa according to valuation 30.22 based on Adjusted P/BV multiple (R$/share) Implied exchange ratio according to valuation 0.212 based on Adjusted P/BV multiple - ----------------------------------------------------------------------- Note 1 Fully diluted number of shares calculation detailed in appendix GAFISA 17 ROTHSCHILD |
![]() | 4. Trading multiples analysis - --------------------------------------------------------------------------------------------------- 4.3 Trading multiples based on Book Value For Gafisa we applied the average Book Value multiple of the entire sample given the difficulty of splitting Gafisa's book value between high/mid and low income operations [GRAPHIC OMITTED] Sector companies Share Market Book price(1) value Value(2) Company (R$/share) (R$m) (R$m) P/BV - --------------------- -------------- ------------- ------- Gafisa 28.30 3,777 1,717 2.20x Mid/High income Cyrela(3) 24.49 10,186 3,443 2.96x Rossi(3) 13.60 3,608 2,206 1.64x Brookfield(3) 7.58 3,224 2,269 1.42x EZTEC 7.44 1,066 866 1.23x Even 6.79 1,215 823 1.48x Tecnisa 9.80 1,433 847 1.69x ------------------------------------ Average 1.74x Median 1.56x ------------------------------------ Low income MRV 34.46 5,605 2,186 2.56x PDG(3) 14.70 5,426 2,592 2.09x Tenda 5.32 2,155 1,101 1.96x ------------------------------------ Average 2.20x Median 2.09x ------------------------------------ ------------------------------------ Total average 1.92x Total median 1.82x - ---------------------------------------------------------------------- Notes 1 30 trading days average price up to 10/21/2009 2 As of 06/30/2009 3 Adjusted for public offerings after 06/30/2009 CalculationTabletitle of the value of Tenda and Gafisa Calculation of the value of Tenda Average P/BV of low income real estate companies 2.20x Tenda Book Value as of 06/30/09 (R$m) 1,101 Tenda value according to valuation based on P/BV 2,428 multiple (R$m) Fully diluted number of Tenda shares (million)(1) 405 Price per share of Tenda according to valuation 5.99 based on P/BV multiple (R$/share) Calculation of the value of Gafisa - ----------------------------------------------------- Total average of P/BV of real estate companies 1.92x Gafisa Book Value as of 06/30/09 (R$m) 1,717 Gafisa value according to valuation based on P/BV 3,302 multiple (R$m) Fully diluted number of Gafisa shares (million)(1) 133 Price per share of Gafisa according to valuation 24.74 based on P/BV multiple (R$/share) Implied exchange ratio according to valuation 0.242 based on P/BV multiple - ----------------------------------------------------------------------- Note 1 Fully diluted number of shares calculation detailed in appendix GAFISA 18 ROTHSCHILD |
![]() | A. Backup materials - --------------------------------------------------------------------------------------------------- A.1 Total number of shares considered for each company Shares of Gafisa (thousand) Total shares issued by Gafisa 133,633 (-) Total treasury stocks 3,125 (+) Stock option plans dillution effect 2,946 Total number of shares considered 133,454 --------------------------------------------------------- Source Gafisa - ITR 06/30/2009 and IAN 2008 Shares of Tenda (thousand) Total shares issued by Tenda 400,652 (-) Total treasury stocks 0 (+) Stock option plans dillution effect 4,403 Total number of shares considered 405,055 - ------------------------------------------------------ Source Tenda - ITR 06/30/2009 and IAN 2008 1 Total shares: Total shares issued by each company, according to documentation filed with the CVM 2 Treasury stocks: Shares held in treasury by the companies, according to documentation filed with the CVM. These shares are excluded from the calculation of the equity value per share 3 Stock options plans dillution effect: Potential net effect of the conversion in shares of the stock option plans held by the companies, considering the price per share and strike prices of each plan. The net effect of the exercise of the stock options plans in the prices per share are calculated by the difference between the trading price and the average weighted price of each stock option plan, if positive GAFISA 19 ROTHSCHILD |
![]() | A. Backup materials - --------------------------------------------------------------------------------------------------- A.2 Calculation of the NAV of the companies used in the multiple analysis Gafisa (R$m) Cyrela (R$m) (+) Receivables 3,024 (+) Receivables 3,237 (+) Revenues to be recognized 3,209 (+) Revenues to be recognized 4,332 (-) Costs to be recognized 1,968 (-) Costs to be recognized 2,771 (+) Land inventory 1,790 (+) Land inventory 2,993 (-) Land payment obligations 407 (-) Land payment obligations 370 (-) Net debt 1,186 (-) Net debt 803 (+) Other balance sheet (1,483) (+) Other balance sheet (2,251) accounts and taxes adjustments accounts and taxes adjustments NAV - Gafisa 2,979 NAV - Cyrela 4,366 --------------------------------------------- ---------------------------------------------- Tenda (R$m) PDG Realty (R$m) (+) Receivables 896 (+) Receivables 1,798 (+) Revenues to be recognized 1,232 (+) Revenues to be recognized 1,896 (-) Costs to be recognized 768 (-) Costs to be recognized 1,206 (+) Land inventory 493 (+) Land inventory 1,082 (-) Land payment obligations 60 (-) Land payment obligations 332 (-) Net debt 100 (-) Net debt 159 (+) Other balance sheet (211) (+) Other balance sheet (237) accounts and taxes adjustments accounts and taxes adjustments NAV - Tenda 1,482 NAV - PDG Realty 2,842 Rossi (R$m) (+) Receivables 1,598 (+) Revenues to be recognized 1,890 (-) Costs to be recognized 1,310 (+) Land inventory 1,038 (-) Land payment obligations 312 (-) Net debt (66) (+) Other balance sheet (333) accounts and taxes adjustments NAV - Rossi 2,638 - --------------------------------------------- MRV (R$m) (+) Receivables 1,580 (+) Revenues to be recognized 1,422 (-) Costs to be recognized 769 (+) Land inventory 1,127 (-) Land payment obligations 248 (-) Net debt (2) (+) Other balance sheet (417) accounts and taxes adjustments NAV - MRV 2,696 Notes 1 As of 06/30/2009 2 Net debt was adjusted for public offerings after 06/30/09 (Cyrela, Rossi, PDG Realty and Brookfield) GAFISA 20 ROTHSCHILD |
![]() | A. Backup materials A.2 Calculation of the NAV of the companies used in the multiple analysis (cont'd) Tecnisa (R$m) Brookfield (R$m) (+) Receivables 660 (+) Receivables 1,492 (+) Revenues to be recognized 1,183 (+) Revenues to be recognized 1,428 (-) Costs to be recognized 669 (-) Costs to be recognized 929 (+) Land inventory 646 (+) Land inventory 2,451 (-) Land payment obligations 88 (-) Land payment obligations 565 (-) Net debt 319 (-) Net debt 395 (+) Other balance sheet (154) (+) Other balance sheet (1,026) accounts and taxes adjustments accounts and taxes adjustments NAV - Tecnisa 1,259 NAV - Brookfield 2,457 - ---------------------------------------------- ---------------------------------------------- EZTEC (R$m) (+) Receivables 466 (+) Revenues to be recognized 469 (-) Costs to be recognized 291 (+) Land inventory 325 (-) Land payment obligations 8 (-) Net debt (137) (+) Other balance sheet (79) accounts and taxes adjustments NAV - EZTEC 1,019 Even (R$m) (+) Receivables 828 (+) Revenues to be recognized 1,233 (-) Costs to be recognized 804 (+) Land inventory 704 (-) Land payment obligations 52 (-) Net debt 501 (+) Other balance sheet (225) accounts and taxes adjustments NAV - Even 1,183 - --------------------------------------------- Notes 1 As of 06/30/2009 2 Net debt was adjusted for public offerings after 06/30/09 (Cyrela, Rossi, PDG Realty and Brookfield) GAFISA 21 ROTHSCHILD |