US$75000000 Lupatech Finance Limited - Banco Best

and Argentina due to our sales and technical support staff and our highly skilled, accredited suppliers and resellers.
In addition, we export our products to approximately 40 countries and have independent representatives in the
United States, Europe, Asia and elsewhere in Latin America. Due to the critical application of our products, we
believe our agility and effectiveness increase our appeal while consolidating our leading position.
Limited Exposure to Oil Price Volatility. Our business is related to the capital expenditure programs of our
customers. Although the revenues of our oil industry customers are directly affected by the volatility of
international oil prices, the capital expenditure programs of these customers are not generally based on the price of
oil. Rather, the investments that these oil companies make in their infrastructure are driven by their maintenance
and expansion needs. In addition, we believe that certain of our customers have developed long-term strategies
focused more on maintaining Brazil’s oil self-sufficiency over maximizing profit. The fact that our activities are,
therefore, linked to the more stable needs of our customers tends to limit our exposure to oil price volatility, which
may affect other companies in the oil and gas industry.
Skilled, experienced management and a results-oriented culture. Our management team is highly skilled
and experienced. Our senior managers have worked for us for an average of 24 years. An important component of
our executives’ compensation is tied to our growth and profitability through a profit sharing program that aligns our
executives’ interests with those of our shareholders. In addition, in 2006 we approved a stock option plan in order to
further align our executives’ interest with those of our shareholders.
Effective corporate governance practices. We are listed on the Novo Mercado segment of the São Paulo
Stock Exchange (Bolsa de Valores de São Paulo), or the BOVESPA. The rules governing the Novo Mercado
require high standards of corporate governance. Prior to our listing, we had a history of private equity investors in
our shareholder base, such as Bozano Simonsen Advent—Fundo Mútuo de Investimentos em Empresas Emergentes,
CRP Caderi Capital de Risco S.A., GP Investimentos and the Natexis Mercosul Fund. In addition, BNDES
Participações S.A., or BNDESPAR, the investment company of the BNDES (Banco Nacional de Desenvolvimento
Econômico e Social), is currently one of our shareholders. We believe our relationships with these investors
established a culture of transparency that focused on the creation of shareholder value, and facilitated our adoption
of effective corporate governance practices that were consistent with the practices required of publicly-held
companies.
Our Strategy
We believe that the global oil and gas industry will continue to grow significantly over the coming years
due to new energy-related investments announced by key industry participants, as well as by the need for industry
participants to maintain their existing infrastructure and to repair and revamp oil platforms and refineries. Most of
those projects will be developed in Brazil, the Gulf of Mexico and the western coast of Africa in deep-sea water
fields, which require special equipment and services. We have developed new technologies that have already been
tested and are in operation in several offshore projects, giving us an important advantage in attracting other
customers with projects in deepwaters. Our main objective is to leverage our market leadership to take advantage of
the opportunities associated with these investments. Moreover, we will try to increase our market share in the global
automobile supply chain, while taking advantage of other opportunities to grow and invest in complementary
businesses and products. To accomplish these goals we plan to:
Consolidate our leadership position in the market through strategic acquisitions. Participants in the
segments in which we operate in Latin America consist mainly of small and mid-sized, family-owned companies.
We believe this fragmentation represents an important opportunity for considerable growth through acquisitions.
We intend to continue transferring our technological and industrial know-how to the companies we acquire so that
they can manufacture and market products at our same level of quality, productivity and profitability. When
opportunities arise in the market, we also intend to selectively acquire companies whose technology and/or products
can be integrated into our production chain to position ourselves as a solution provider.
Enhance productive capacity through prudent investment. In line with our history, we are prudently
investing in the expansion of our plants to increase our capacity, productivity and ability to achieve economies of
scale to enable us to respond to increased demand for our products.
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